Experience Economy: Effects on Marketing - Coursework Example

Experience Economy: Affects on Marketing Submitted by: XXXXXX Number: XXXXXX of XXXXXXXX XXXXXXX XXXXXXXXX Subject Code: XXXXXX Date of Submission: XXXXXXX Number of Words:1764 (Excluding Bibliography) The experience economy perspective proposes to change the way products are, designed, promoted, and consumed. What are the marketing consequences of adopting this approach? Introduction: Experience economy is one of the most sophisticated forms. There is a constant change at every level for every economy. Changes are inevitable. Every company requires making changes to their products and services while the economy matures, ages and evolves into becoming something new. Every business has a number of different elements that it is made off, like branding, marketing, development, research, all these departments and even the production department of the company need to make a number of adjustments with the growth of the economy. There is always a high pressure that the companies will undergo due to the needed change to improve and stay in sync with the changes in the markets (Brownlie, et.al, 1999). There are also a number of companies that fail to realize the new realities which leads to unwanted and dramatic consequences. The experience economy, in a number of ways, proposes the need for a change in the products in terms of design, promotion and even consumption. This paper aims at understanding the various changes that companies need to undertake in terms of the marketing of these products. The paper will deal with in brief the various changes that are expected from the companies to change in the product in terms of design, promotion and also consumption. Following which the marketing consequences will be discussed in detail. Current Changes: With the growing change of economies and the various technological developments, there has also been a clear change which has been required from the companies as well. The needs of humans change over time and taking the example of Maslow’s Hierarchy of needs, it is clear that there is a strong connection between the economic growth and the personal choice in the current economy (Buchanan & Huczynski, 2004). In the earlier days, the economy would be able to meet us to the people’s needs and requirements. The basic needs and Maslow’s Hierarchy’s first step of basic needs like food were easily provided and the growth of the industries led to provide the necessary goods to satisfy the other needs like the safety until the social acceptance and also status. However in the recent ages, with the use of the World Wide Web and the internet, there have been a few changes in terms of the desire for knowledge, which were earlier satisfied by the information economy which provided for answers to the cognitive needs and also the desire for knowledge. There have been changes in almost every sector of the industry and the World Wide Web is now providing the companies with a strong base for the marketing and also for advertisements. The World Wide Web has led to a number of changes in the industry (Kotler, Armstrong, Wong, and Saunders, 2002). Also with the growing need to have everything compact and easily accessible, there have been a number of changes in the types of products that are sold and also the design along with the promotion and also consumption plays a very important role in the current time. The introduction of the web to a great extent has disrupted the business as usual for a number of companies and the effects have been seen in the music, film, television, books publishing, software industries and many more. The changes have been quite traumatic rather than being dramatic in nature and there has been a need for extensive growth and more accessibility that has been developed. The changes have been so wide that most companies have also met with the situation of ‘adapt or die’ (Bader, 2008). This has become a very true scenario for businesses and if companies want to be able to survive in the markets, it has now become imperative that the businesses adapt to the growing changes in the market. Affects on Marketing: Comparing the experience Economy and the top of the pyramid of Maslow’s hierarchy theory, the one common top desire is that of self – actualization (Buchanan & Huczynski, 2004). This means to make the best use of the existence and it is to make people the best of what thy can be. This is one of the biggest issues of economic reality. In the book by James H Gilmore and Joseph B. Pine – The Experience Economy, there has been a great discussion of what businesses need to take care of in the current economic era. They state: "While commodities are fungible, goods are tangible, services are intangible, experiences are memorable and transformations are effectual. All other economic offerings have no lasting consequence beyond their consumption" (Sheth & Sisodia, 2006). This defines the actual and exact situation at present and provides a clear picture of how the businesses need to focus on their businesses due to the current consumers in the markets. From the above statement made by the authors, it is clear that the marketing of a company is mainly set down on making the experience very memorable and the transformations very effective for the customers. These form the basic rule for all marketing in the new economic era and play a very important role for the companies to be able to survive in the recent times. The use of this as the basic rule will provide the companies with a stronger market presence and also will increase the brand awareness among the customers thereby letting the companies grow to their best and perform well (Bader, 2008). The earlier type of marketing that was adopted by companies was very focused on the commodities that need to be delivered and the various services provided. However in the recent age there is a need for a complete different approach. Along with the improvement of products and services based on the new technologies, the marketing efforts of companies also need to get a facelift. The important aspect of business in the current times is not that for lower prices and new features only however it is the experience that helps satisfy the soul (Bader, 2008). This has turned out to become the most essential part of every business and if a business wants to survive in the markets it is essential that they follow this change and move in sync with the change. Marketing by itself is a very vast topic with a lot of importance in the working of every business. The concept of storytelling marketing is one, where the marketers, use stories to market their products and services. There have been a number of different successful examples of companies that have proved to provide the business with higher success and also satisfy the soul of the customers. Storytelling marketing is one of the most effective forms of marketing and it not only provides the customers with a product, but also with an experience to remember for a very long time. One of the finest examples of this has been the marketing effort of Coco – Cola. The advert of Coke depicted the looks of Santa to be a white bearded old man with a happy, jolly face in a bright red suit with a sack of Christmas gifts for everyone (thecocoa-colacompany, 2008). Talking about the storytelling marketing, it is essential to understand that word of mouth marketing falls into this category as well. According to Quealy, “one communication method that beats all others when it comes to delivering a memorable, motivating, and meaningful message: telling a story” (Rozgonyi, 2008). Also Coca Cola was the first brand to bring out the red colour to the corporate world and also introduce the Happiness Factory (Sridhar, 2008). The company has brought to life different stories of Santa Claus, Polar bears and a number of other fairy tales. The excellent imagination that the company has brought out in its ads, make people want to believe that each time a coin is put into the vending machine, the Coke is produced inside the machine in a fairy tale like environment. Coca cola has been able to use its ads to make such beautiful stories that each of them seems to be fairy tales on their own. The Santa Claus story became the main birth place of story telling marketing (Sridhar, 2008). This story was such a hit among the people, that people actually started believing that Santa was real. This has left the customers with a memorable experience and a transition which has been very effective. This is one of the examples of the change that marketing has undertaken and there are a number of other examples which are present both in terms of online as well as offline modes. Another very good example of this is that of Mac computers which has gained the market share because of the experience that it has provided with the iPods. Also the famous coffee house – Starbucks is not only famous due to the coffee it provides however it is more so for the experience that the company has been able to develop. Thus based on these examples, it is clear that the marketing of companies is now facing a change where it requires being a more sophisticated and psychological rather than being just straight forward and product oriented. The marketing also requires being able to meet the emotional needs of the consumers and to some extent provide a level of satisfaction within the hectic, demanding and frustrating world which is very fast paced and busy at all times. Conclusions: Thus based on the above discussion it is clear that marketing has now got a complete face lift and the companies that have been able to cope with this change will be able to survive in the market. The main goal of marketing is to now convert the prospective customer into the customers of the company through self actualization. Also as mentioned, marketing is more about the people rather than the products or services. Thus the result of marketing is now the customer, which can be done by providing them with an unforgettable experience. Also the success of a company is now based on how innovative the marketing effort is and how well the companies are able to differentiate themselves from the competitors, mainly through smart, innovative and sophisticated messages which can leave an unforgettable memory for the customers. Finally it is also essential to note what Pine and Gilmore have already mentioned in their book’s title: The Experience Economy: Work is Theatre & Every Business a Stage (Sheth & Sisodia, 2006). Thus marketing has been vastly affected with the experience economy and there have been a number of drastic changes that the companies have needed to make to survive in the markets. Bibliography Bader, J., 2008, A Six-Step Web-Branding Blueprint for the Experience Economy, 12 August 2008, Accessed on 11th April 2009, Retrieved from http://www.marketingprofs.com/8/web-branding-blueprint-for-experience-economy-bader.asp Brownlie, D., Saren, M., Wensley, R. and Whittington, R. (eds.) (1999), Rethinking Marketing: Towards critical marketing accountings. London: Sage. Buchanan D. and Huczynski A., 2004, Organizational behavior, 5th edn, Prentice Hall, Essex Kotler, P., Armstrong, G., Wong, V. and Saunders, J., 2002, Princilples of Marketing, 2nd Edition, Prentice Hall, Milan Rozgonyi, B., (2008), Story Telling Marketing | Search Engine Strategies Coverage, 22nd December 2008, Accessed on 11th April 2009, Retrieved from http://barbararozgonyi-wiredprworks.com/2008/12/19/storyteller-marketing-search-engine-strategies-coverage/ Sheth, J. N., Sisodia, R. S., (2006) Does Marketing require reform?: Fresh perspective on the future, M.E. Sharpe Publications Sridhar, K. V., (2008), Brands should be great story tellers, 20th June 2008, Accessed on 12th April 2009, Retrieved from http://www.livemint.com/2008/06/20234413/Brands-should-be-great-storyte.html Thecoco-colacompany, (2008), Coke Lore, Accessed on 12th April 2009, Retrieved from http://www.thecoca-colacompany.com/heritage/cokelore_santa.html Read More