Sport and marketing in the experience economy

The challenge we face today is that competing products and services can’t stand out from each other on features alone. ‘Quality’ is no longer even negotiable, everything can be replicated, and innovation happens quicker that adoption. 

So we know that to succeed, the customer must value the experience of using a product or service, and, some smart people tell us we have already moved from a ‘Service economy’ into an ‘Experience Economy’.

"Tell me, I forget. Show me, I remember. Involve me, I understand."

In what I thought was a brilliant analogy explaining this evolution, IDEO’s Tom Kelley spoke in his recent book of how in a ‘commodity-orientated economy, Mum bought the flour, sugar and eggs, adding all the labour herself to bake and ice the cake. The next evolutionary step – a product economy – has people buying Betty Crocker cake mix and a can of icing.

In a service economy, the cake is made in a bakery, and they’ll even put your child’s name on it.

But in an experience economy, you take Jack and his friends to the local PlayCentre where they are provided with active play, food, drinks, and-oh, by the way – the birthday cake at the end!’

How familiar does that sound to you in your behaviour as a consumer? And for your industry? 

This transition between the service economy to an experience led one is in line with our thinking, and for leading brands using sport as a marketing platform.

The move to experience offerings is a very familiar story, and it will be no surprise that there is evidence to say that buying experiences makes people happy, and gives a greater sense of well being. And critically, current research shows that millennial’s value experiences over products, and we know across history it is youth that set future trends.

"More than 3 in 4 millennials (78%) would choose to spend money on a desirable experience or event over buying something desirable" - Eventbrite

"With millennials now accounting for over one fourth of the total U.S. population, their high focus on experiencing life supports the growth of an economy driven by the consumption of experiences."

At Limelight we have been thinking, what does this mean to the active, sporting world?

We put some thought into this in a recent team strategy session, and our understanding of the active world saw many examples of the experience economy emerging.

To use running as an example, in the commodity economy, we ran, in shoes. The product economy saw us run in branded running shoes. In the Service economy we run with a club, with coaches providing training programs between organised competitions.

In the Experience Economy we put on our shoes, specialised kit, wearable tech, and headphones, we run together, physically and virtually. We track and share on devices and multiple channels, with accompanying soundtracks and imagery. In social groups or mass participation events, we experience moments and whole journeys together. 

The fitness industry has evolved from machines to experiences. Interactive and sometimes now immersive virtual experiences. ‘Wellness’ product and service providers are quickly needing to evolve from services to experiences to appeal, and stand out in a growing market.

And we see this day to day as we work with leading brands, using real life active experiences to engage with their audiences. Nike is a leader in this area (as they are in all their work). Innovating constantly, they obsess over every touch point and create premium, personalised experiences, whether it be in retail or in the active world.

To get it right, Joe Pine calls out four realms of experiences, and the magic happens when we hit all elements, from entertainment to esthetic, escapist to educational.

With our events we always explore all elements of an experience, but at Limelight we always sit to the right of centre, with our belief in the immersive power of active experiences. 

Another aspect of the Experience Economy that really resonates with our ambitions, and process, was the goal to reduce ‘customer sacrifice’. This is Jim Gilmore's terminology for the gap between a customer (or clients) wants, and what they settle for.

    Services + Experiences

    Brands ----> <---- Audiences

In our work we are constantly seeking to understand these customer needs and desires, and creating solutions that reduce, or eliminate any sacrifice. We use data and empathy to understand the things they need to get done, reducing the pains and creating the gains on a customer’s experience with us.

In fact we aspire to eliminate the sacrifice. Exceeding expectations we call it.

Let me know if we can help your organisation take the lead in the Experience Economy.

Through real life active experiences. 

"People will forget what you said,

people will forget what you did,  

but people will never forget how you made them feel"

- Maya Angelou