Why Experiences Can Create Revenue in Any Business
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1 Why Experiences Can Create Revenue in Any Business Væksthusene August 18, 2010 B. Joseph Pine II Strategic Horizons LLP 13 High Point Road Dellwood, MN USA +1 (651) Strategic Horizons LLP
2 The Progression of Economic Value Experiences Stage Services Deliver Commodities Goods Make Commoditization Commoditization Extract 1999 Strategic Horizons LLP
3 Coffee Progression Experiences Services Goods Commodities
4 Economic Distinctions Commodities Goods Services Experiences Economy Agrarian Industrial Service Experience Economic function Extract Make Deliver Stage Nature of offering Fungible Tangible Intangible Memorable Key attribute Natural Standardized Customized Personal Method of supply Stored in bulk Inventoried after production Delivered on demand Revealed over duration Seller Trader Manufacturer Provider Stager Buyer Market User Client Guest Factors of demand Characteristics Features Benefits Sensations 1999 Strategic Horizons LLP
5 The Progression of Economic Value Experiences Stage Services Deliver Commodities Goods Make Commoditization Commoditization Extract 1999 Strategic Horizons LLP
6 The Birthday Party Progression Experiences Services Goods Commodities
7 The Progression of Economic Value Customization Customization Goods Make Commodities Experiences Stage Services Deliver Commoditization Commoditization Extract 1999 Strategic Horizons LLP
8 The Essence of Mass Customization Portfolio of Customers Portfolio of Capabilities Customer Needs Design Tool Customer-Unique Experience Chain 1999 Strategic Horizons LLP
9 The Four Experience Realms Absorption Entertainment Educational Passive Active Esthetic Escapist Immersion 1999 Strategic Horizons LLP
10 Competing Against the World Time : Limited Attention: Scarce Money : Consumable The Experience IS the Marketing 2006 Strategic Horizons LLP
11 Placemaking Portfolio Singular Place FLAGSHIP LOCATION EXPERIENCE HUBS MAJOR VENUES Ubiquity Physical Access WORLD WIDE WEB DERIVATIVE PRESENCE WORLD WIDE MARKETS Virtual Access Ubiquity DERIVATIVE PLACEMENT MAJOR PLATFORMS EXPERIENCE DOMAINS FLAGSHIP SITE 2007 Strategic Horizons LLP Singular Place
12 Measuring Advertising Efficacy Efficacy = Efficacy = # People x Recall Cost Measuring Experience Efficacy # People x Time x Attention x Intensity x Memorability Cost 2007 Strategic Horizons LLP
13 Placemaking Portfolio Temporary Real Experiences Physical Access Ubiquity WORLD WIDE WEB DERIVATIVE PLACEMENT MAJOR PLATFORMS EXPERIENCE DOMAINS FLAGSHIP SITE Singular Place Free Permanent FLAGSHIP LOCATION EXPERIENCE HUBS MAJOR VENUES DERIVATIVE PRESENCE WORLD WIDE MARKETS Ubiquity Virtual Access Web Experiences Fee 2007 Strategic Horizons LLP Singular Place
14 Measuring Return on Advertising Investment ROI = Incremental Revenue Cost Measuring Return on Experience Investment ROI = Incremental Revenue Cost Admission Fees 2007 Strategic Horizons LLP
15 2007 Strategic Horizons LLP Infinite ROI
16 Personal Computer Progression Experiences Services Commodities Goods
17 Principles of Acting Give workers roles to play Characterize those roles Names Scripts Costumes Body language Props Act with intention Enact dramatic structure 2007 Strategic Horizons LLP
18 Dramatic Structure Complication D E A - Exposition B - Inciting incident C - Rising action D - Crisis E - Climax F - Falling action G - Dénouement F A B C G Time Source: Brenda Laurel, Computers as Theatre (Reading, MA: Addison Wesley Publishing Company, 1993), p. 86; derived from Gustav Freytag, Technique of the Drama, 2d ed. (Chicago: Scott, Foresman, 1898)
19 Economic Changes Economic Output Business Imperative Consumer Sensibility Experiences Render Authenticity Services Improve Quality Goods Control Cost Commodities Supply Availability 2007 Strategic Horizons LLP
20 Three Rules to Do Business By If you are authentic, you don t have to say you re authentic If you say you re authentic, you better be authentic It s easier to be authentic, if you don t say you re authentic 2007 Strategic Horizons LLP
21 This above all, to thine own self be true; And it must follow, as the night the day, Thou canst not then be false to any man. -Polonius William Shakespeare, Hamlet, Prince of Denmark, Act I, Scene 3, lines
22 Rendering Authenticity IS what it says it is Real-fake Real-real Is NOT what it says it is Fake-fake Fake-real Is NOT true to itself IS true to itself 2007 Strategic Horizons LLP
23 Being True to Self Heritage = Origin + History 2007 Strategic Horizons LLP
24 Being What It Says It Is Place = Venue + Event 2007 Strategic Horizons LLP
25 Placemaking Portfolio Temporary Real Experiences Physical Access Ubiquity WORLD WIDE WEB DERIVATIVE PLACEMENT MAJOR PLATFORMS EXPERIENCE DOMAINS FLAGSHIP SITE Singular Place Free Permanent FLAGSHIP LOCATION EXPERIENCE HUBS MAJOR VENUES DERIVATIVE PRESENCE WORLD WIDE MARKETS Ubiquity Virtual Access Web Experiences Fee 2007 Strategic Horizons LLP Singular Place
26 The Progression of Economic Value Customization Customization Transformations Guide Experiences Stage Customization Services Deliver Commoditization Commodities Goods Make Commoditization Commoditization 1999 Strategic Horizons LLP
27 Achieving Aspirations From To 1999 Strategic Horizons LLP
28 Guiding Transformations Diagnosis Staged Experiences Follow- Through 1999 Strategic Horizons LLP
29 The Progression of Economic Value Customization Customization Transformations Guide Experiences Stage Customization Services Deliver Commoditization Commodities Goods Make Commoditization Commoditization 1999 Strategic Horizons LLP
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