In 1998, the Harvard Business Journal presciently forecast the emergence of the Experience Economy, a business model structured on creating deep connections between consumers and brands through high quality experiences that drove those connections.
The kind of connections I call durable.
In 1998, it was hard to see how to apply KPI’s to such a model. Beyond surveys and polling in a human to human way, measuring the reaction to experience was difficult. HBJ had bravely titled it the “4th Economy”, but it was hard to see how value was created specifically, or extracted.
Now, the technological horizon allows us to find the real X factor of the experience economy. Measuring experience.
Much of the work around the experience economy is about crafting and delivering the consumer experience – literally the moments of interaction at the time of purchase. But an awareness is growing of how important it is to foster experiences beyond the transaction.
Michael Voegele, CIO of Adidas made this observation: “To change people’s lives, we believe you need to create direct relationships with consumers. You should not put out one-directional messages. It should be a bidirectional, joined conversation. “
Pop-Up Retail and Experiential Marketing Installations are the ultimate manifestations of this philosophy. Festivals like Coachella and SXSW are as much anchored by the opulent new wave of themed brand experiences as they are by music, film, or keynote speeches. These installations create incredible context and powerful resonance for brands. They now also generate incredibly valuable, and specific metrics.
The payoff is tangible. Curated digital interactions, opt-in app accompaniment, spatial tracking, and expert system driven adaptation are providing rich data for measuring the level of audience interaction, success of message, and building o brand community. This data can be analyzed and utilized in much the same way that metrics from digital marketing platforms can, but the intersecting inputs lead to very high fidelity. A digital ad knows you clicked. A digitally enabled experience knows where you clicked, where you looked, and when you smiled. It then also participates in social media echoes bridging the real and the digital.
The extra secret sauce ? Adaptation.
As we measure, so can we move. Realtime analysis of heatmaps, eye tracking, and engagement input can now be used to affect the delivery of the experience in real time, leading to incredible personalization. Media, interactivity, lighting, and narrative journey can all be modulated in realtime to appeal specifically to that audience member, at that moment.
This of course also now starts providing trialing data. Did the experience work better with this, or with THIS ?
The data sources, and fidelity of the insights are more abundant than ever. It would seem the “4th Economy” has truly arrived.
Measuring experience is the real engine of the experience economy.
Start it up.