Lately there has been a lot of buzz around the importance of creating an experience for your customers. A demand driven by the millennial generation, businesses must bring more to the table than the product or service they offer. Today's consumers are gravitating towards brands that create memorable events and evoke emotional feelings in association with their products. This experience-focused phenomenon is known as the experience economy.
But, before you get too comfortable, while the experience economy is still alive, the market is making its way into the next stage of the economic system, the transformation economy. How do the two compare in the long line of economic systems that have controlled global trade for centuries? First, let's take a step back and explore how our economic system has evolved.
How The Experience Economy Impacted Marketing
As society moved from the service economy into the experience economy, people took on a new set of expectations centered around seamless and effortless connectivity. In this economy, consumers are driving the market. They became picky, and they dictated what experience they wanted from producers and traders. Soon enough an experience became quantifiable, commoditized and monetized. Customer experience took the central focus and user-friendliness was the buzzwords in all boardrooms. It is in this economic system that big data analytics became a central part of marketing operations.
How The Transformation Economy Impacts Marketing
The economic system is undergoing a shift from the experience economy into the transformation economy. Sure, smart buyers will still crave an experience, but soon that alone won't be enough. People are starting to demand transformative ways of interacting with products and services. They are savvy, selective and informed, and want to be understood on a personal level. As a marketer armed with many digital channels, it’s critical that you understand the appeal of each system to the clients and how they want to be engaged. The heart of the transformation marketing is using hyper-connectivity to bring transformative experiences to clients.
The Experience Economy vs. the Transformation Economy
There are a number of critical differences between the experience economy and the transformation economy. While both of them work on pretty similar fundamentals, the metrics are rather different. First, in an experience economy, the value of the experience is in its capacity to stimulate the users, while in transformation marketing, the value of the experience lies in its ability to alter how users consume goods and services. Secondly, in the experience economy, the overall output is based on the producer’s ability to tell a story, while in transformation marketing, the big question relies on whether or not the user is able to live out the sought-after outcome of the experience. Lastly, in the experience economy, the focus is on the sales process, while in the transformation marketing, the focus is on the buying process.
The Scholars Who Predicted This Future Trend
The advent of both the experience economy and the transformation economy didn’t chance on us. They were predicted as far back as the late 1990s. In 1999, James Gilmore and Joseph Pine wrote a seminal work titled, The Experience Economy. According to these two thought leaders, no longer did clients look for products or services - they now wanted an experience derived from having or using a particular product. Donald Normal would follow suit with the publishing of What You See, Some of What's in the Future, And How We Go About Doing It: HI at Apple Computer. McCarthy and Wright would follow with the support of their 2004 work, Technology as Experience.
Brands in the Transformation Economy
- SoulCycle. The New York based fitness brand has revolutionized the indoor cycling experience, creating a community of rabid-fan riders, joining together to accomplish their shared goal of changing their lives on and off the bike. Thanks to SoulCycle, cycling class is no longer just a fitness activity, but rather 45 minutes of lifestyle transformation with inspirational instructors, high energy music, epic spaces, and more.
- Netflix. Even as DVD sales and box-office ticket revenues drop, people are consuming, even more, entertainment. Netflix produces the ability to stream music and movies in a way that brings the whole transformative power of choice into your living room. This has birthed the TV series binge phenomena.
- 12 Week Body Transformation. Michelle Bridges has moved the exercise and clothing range services beyond product offering. Her brand now focuses on support, coaching, empowerment and education. This experience of providing a holistic sense of mind body and spirit has seen her amass over $53 million and getting featured on the wealthy women’s list.
- Nike. For the longest time, Nike solely concentrated on the production of sporting gear. In recent years they have diversified into digital investments like the Nike+ Running App, Nike FuelBand, and NikeID. This combination or sporting gear, Nike app and Nike Clubs is meant to create a wholesome transformative experience.
Applying Transformation Marketing to Promotional Products
The ideology of the transformation economy can be applied to a brand's selection of unique promotional products, by offering items that enhance -and transform- their consumer's lives. Whether you're a health food brand promoting a healthier lifestyle by gifting your audience with step-counters and hosting step challenges, or a natural tea business promoting anti-stress and relaxation by gifting serenity candles, eye masks, and custom yoga mats, or what have you, promotional products provide value by supporting your consumers' transformation goals.
Amidst the customer experience-centric world we are living in, a new wave of values and demands are approaching us as we enter the transformation economy. Now is the time to adapt your marketing strategy so you are prepared to connect with the next generation of consumers, positioning your brand ahead of the competition. Partner with us to develop a promotional products strategy that helps your consumers reach the transformation they are seeking.