A relatively recent term, experience economy was first used in 1998 but has never been more relevant than in the current time where engagement is of utmost importance due to the rise in millennials and their preference to engagement and feel rather than the actual products. As we leave the times of service economy, where a product’s maintenance and service used to define them, the experience economy is setting in, turning the cycle. But what exactly is it and how much does it truly impact the marketing scheme of businesses?
What is the Experience Economy?
Experience economy means that a business must now offer a memorable experience as the main aspect of its product on top of its regular use if they mean to stay on top of the game. To some, this term may be foreign and sound far-fetched in terms of maintaining sales. However, the truth of the matter is that this type of marketing has now surrounded us more than ever. From the environment of establishments where a product is sold to how the product itself gives a valuable experience when consumed, customer experience is directly correlated to the term.
Setting Apart Your Product from the Competition
Every business, especially among startups, is always scrambling to set apart their products from the similar competition. This is proven more accurate as we live in a world where becoming original is proving to be more and more challenging. And this is where the experience matters. While simple things like adding unique flavors or featuring peculiar ingredients can turn a few heads, it is nothing quite compared to splendid customer experience.
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And it is due to investing in customer experience that a company typically can earn additional revenue of up to $775 million dollars in around three years after the initial investment.
How does it Work?
An experience economy typically works in a way that your customers would want to pay premium for an experience beyond the product or service. These types of experiences can be found in initiatives such as:
- Beneficial subscriptions
- Premium privileges
- Discounts through electronic currency
- Et cetera
Generally, these are some of the things you’d find quite common these days. But that in itself just proves how widespread the shift in this economy has become. This is further backed by the growth of technology that had served to create initiatives and options one couldn’t even dream of before. The examples above are essentially mainstream; whilst the point of branding is to stand out. Thus, it shows just how out of the box your way of thinking should be to do so. Delivering a unique customer experience and make it like a signature of what to expect of your product or service is no small task.
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Yet, 70% of customers choose a brand based on the provided experiences; whether it is subconsciously or otherwise. This is the same phenomena that make a unique cafe with a cozier environment such a hit with the modern youth despite the case of ridiculously steep prices of sub-par coffee.
Some Quick Examples
There are multitudes of ways how you can implement initiatives to differentiate a customer’s experience with your product or service from the competition. Besides the usual accommodation of visuals and feels, you could:
Create a Unique Loyalty Program
Some loyalty programs, like Gojek (One of the biggest ride-hailing service in Indonesia)’s Gopay and its Gopoint system, implement a signature feel to how they are accumulated by the customers. Even from the ring of their mini-games sound being played, you can already tell that it is Gojek’s. Their premium experience added with their electronic currency drives the customers to spend more and choose them over their competitors.
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One of the more obvious key factors in customer experience is the application of gamification. Be it from loyalty program to after-sale interaction, gamification can help your product give your customers a refined new experience. This is especially more so when you factor in in-depth personalization to your brand.
While some thinks AI usage in branding is a bit off, nothing could be further from the truth. While AI is young, not many companies have invested in it, and thus, it is easier to be unique with it. But that aside, helpful AIs such as Cortana and Siri are slowly making way and often, people would know the brands they are from (Microsoft and Apple respectively) from the mention of their name.