10 Years ago Joe Pine and Jim Gilmore published the classic book: The Experience Economy, in which they said a business is what it charges for. If your business is competing solely on price, then you’re a commodity. Pine and Gilmore said that instead, businesses should be a stage; creating memorable events, thereby allowing them to charge a premium.
In this episode of Power to the Small Business, we celebrate the 10th anniversary of The Experience Economy with a look back and a look forward at the relationship between business and the customer’s experience. Are businesses engaging customers in memorable experiences? How can they earn a premium and create customer loyalty?
Guests: Joe Pine, Jim Gilmore authors of The Experience Economy: Work is Theater & Every business a Stage
Length: 31 minutes
The Experience Economy Show Notes
Joe Pine & Jim Gilmore
Selected quotes from the show:
“You are what you charge for. If you charge for undifferentiated stuff, you’re in the commodity business. If companies, because of this recession, treat their offerings as just stuff, then they’re commoditizing themselves.”
“Advertising today is a phoniness generating machine.”
“Place-making should rise to rival marketing as the dominant discipline of demand creation in businesses.”
What’s the state of the customer experience in the economy? There has not been enough of charging explicitly for the experience. …To a great extent it accounts for the economic difficulties that the United States and other countries find themselves today.
Determine what business are you in:
- If you charge for tangible things, you are in the goods business.
- If you charge for the activities your employees perform, you are in the service business.
- If, and only if, you charge for the time your customers spend with you, are you in the experience business.
“Increasingly, people decide what to buy based on how authentic they perceive it to be, and that authenticity is self-defined.”
The Key Standards of Authenticity:
- Being true to self – Does this offer match the company that’s offering it.
- Being what you say to others – What you say is actually what the customer encounters.
The most difficult step to participating in the experience economy is your theme. The theme is your organizing principle around which your experience is created.
The Customer Experience Map – Download and instructions