After enduring months of stay-at-home orders prompted by the global pandemic that began in March 2020, it’s no wonder that consumers are still reveling in the reinstated freedom of gathering for in-person experiences. In fact, recent research from McKinsey found that consumers now prioritize experiences over products, reflecting a significant cultural shift across all age groups. This growing preference for meaningful interactions has pushed brands to focus on delivering unforgettable experiences rather than just selling goods.
The transition to the experience economy becomes even more significant when we focus on younger consumers: According to a study by Eventbrite, 3 out of 4 Millennials (78%) would rather spend money on experiences than on material goods. Millennials (defined as consumers born between 1981 and 1996, making them currently between the ages of 28 and 43) value experiences more highly as a key differentiator when choosing how to spend their money, particularly in areas like dining, travel, and entertainment. This shift has led to a booming experience economy and is transforming how brands engage with their audiences.
But how can product-oriented brands make the transition and thrive in the experience economy? In this blog, we’ll explore the origins of the experience economy, why it’s important for brands, and examples of how (matter) has helped its own clients succeed in this changing marketing landscape.
What is the Experience Economy?
The concept of the experience economy was first introduced by business thought leaders B. Joseph Pine II and James H. Gilmore in a 1998 article that became a book the following year (both titled The Experience Economy). The authors described a broad, global economic progression over centuries from an agrarian economy (based on commodities such as wheat and cotton), to the industrial economy (focused on goods such as mass-produced automobiles and textiles), to the service economy (which includes industries such as healthcare, financial services, hospitality and tourism).
Finally, the authors argued, we had arrived at the experience economy, which includes everything from large-scale concerts and entertainment to boutique, luxury wellness resorts—all accelerated by advancements in technology, social media, and consumer expectations have accelerated the rise of the experience economy. Today, businesses are focused on creating memorable, personalized experiences for their customers, including the development of interactive retail environments and immersive brand experiences.
Activations within the experience economy can include:
Retail Experiences—interactive stores and pop-up shops where customers can engage directly with products. (matter) client Hershey’s Chocolate World is any kid’s dream destination. But it’s located in Times Square, competing with literally thousands of other tourist attractions, so it can be a challenge to get visitors. We developed multi-pronged directional campaigns to digitally target visitors as they arrived in New York, then again when they stepped foot in Times Square, where we had installed a seven-story video ad (the largest of its kind!) before ultimately driving them into the Hershey’s store to the point of conversion. The sweet result? 75K+ social engagements, 16% increase in the store’s December sales, and an impressive 103% increase in premium item sales.
Digital Experiences—virtual reality (VR) or augmented reality (AR) experiences, gamification, and interactive content. For example, when Carnival Cruise lines invested more than $155M to makeover their “Carnival Destiny” cruise ship, (matter) created a multichannel digital campaign that tapped into the ship’s loyal fan base by encouraging engagement through gamification, where participants earned points for interacting with Carnival’s posts. A dedicated microsite tracked points and showcased videos, rules, and prizes. Over four weeks, the campaign significantly increased active users and interactions, driving substantial growth in the ship’s online community and ensuring the ship was consistently sold out for its first year of voyages.
(matter) helped the Children’s Museum of Indianapolis increase engagement by developing an interactive iPad app for their Doc McStuffins exhibit. In the children’s television show, Doc McStuffins relies on her Big Book of Boo Boos to diagnose her patients (usually her stuffed animals!). By turning the popular book into an interactive iPad app that kids could use in the exhibit to diagnose patients, we boosted engagement to a remarkable 94% completion rate, attracted 15K visitors in the first week alone, and ultimately helped ensure the exhibition would sell out in record time for the next three years as it traveled to other museums.
Bardstown Bourbon Company was another company that engaged (matter) to create a unique digital experience, this time at its new Louisville tasting room. Aiming to connect urban visitors with the distillery’s roots in Kentucky’s Bourbon Country, (matter) designed a custom brick wall that, through augmented reality (AR), revealed scenes from the Bardstown distillery. Visitors could activate the experience by scanning a cleverly hidden QR code embedded in a piece of art. The installation attracted over 250 visitors in its first month and earned a Silver Addy Award for innovative use of technology, helping the brand engage new audiences in downtown Louisville.
Event-Based Experiences—concerts, brand activations, festivals, or live product demos where consumers immerse themselves in the brand. (matter) helped Beacon Roofing Supply make their annual Leadership Summit an event to inspire, starting with a modern logo that was turned into a selfie backdrop at the event. We also created a series of eight-foot-tall rotating columns highlighting the theme, plus hundreds more on-site graphics. And, to drive engagement with the conference app, (matter) created trivia challenges and hid Texas-related items (such as a rubber snake and a cowboy hat) with QR codes that could be scanned for points. The result? Nearly 100% adoption of the app by conference attendees.
Why Marketers Should Embrace the Experience(s)
Clearly, it’s now essential for brands to deliver more than just products or services. Today’s consumers are seeking memorable, meaningful interactions with brands. But rather viewing the shift as an obstacle, brands can use unique experiences to help stand out in a crowded and competitive marketplace. Plus, by crafting personalized, positive experiences that engage consumers on a deeper level, brands can forge meaningful and lasting emotional connections that lead to increased loyalty, repeat sales, and organic word-of-mouth promotion. Contact the (matter) team today to explore how you can start integrating experience-driven strategies and make your brand matter more to your audience.
