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Thursday, February 21, 2008

What Happens When Experience Economy Meets Recession Economy?

Orange Question Mark Button originally uploaded by jhhwild.
For the month of February, Stephanie Weaver from Experienceology asks:

What happens when the experience economy meets the recession economy?

What do you think?

Guest blogger Joe Pine from Strategic Horizons offers his take [I hope you remember him from The Experience Economy and, more recently, Authenticity.]

I contributed my perspective [Guest blogger CB Whittemore on the February theme], but I'm still thinking about the question and the implications, especially as it relates to demographics and our having more people [i.e., 60% +] over the age of 40 than ever before.

This has serious implications. For the economy. And for retail.

No surprise, David Wolfe from Ageless Marketing has been pondering the matter. Here, he sets the stage:
+ A Look at the Likely State of the Economy Over the Next Several Years (Part 1)
+ Part 2
+ Part 3

Having set the stage, he offers solutions. First, via some lessons:
+ Part 1: open source problem solving
+ Part 2: Euros vs. dollars

And then strategies:
+ #1 - Create Insanely Happy Employees
+ #2 - Enter a New Consciousness and Think systems, relationships and how you frame opportunities
+ #3 - Adapt Your Life to Web 2.0: Turning Your Company into a Complex Adaptive System and The Role of Collective Intelligence.
+ #4 - Connect With the Zeitgeist and Zeitgeist Part 2

Although the series is to-be-continued [and I urge you to stay with it], the 'zeitgeist' David refers to affects us all profoundly. As Economic Woes Reveal a Long-Felt Unease, retailers will need to adopt new ways of reaching consumers.

That's where Stephanie's question becomes particularly relevant: What happens when the two economies collide?

I believe that experience will matter more than ever as we become increasingly demanding and intolerant of sub par experiences.

As we deal with rising prices for gasoline, home utilities, health care, even basic staples like milk, we face diminishing discretionary dollars. Unless income increases to compensate for the difference, we have to do the same with less. Right now, even though Americans feel better about future: Reuters poll, we see tough times ahead. [Wharton just published this article titled Economic Stimulus Package: Will It Work, and for Whom?]

Combine the notion of reduced financial resources with the ever elusive and disappearing resource of time, and you can be sure that we will be willing to walk away if we aren't satisfied.

Think about it. We have lots of stuff - clothes, nick-nacks, furniture, toys.... [Just look at the dramatic increase in storage facilities around the country. What do you think goes into those storage pods? If you don't believe me, read Self-Storage Nation. Americans are storing more stuff than ever and Self Storage Association: 81 Percent Growth in Number of U.S. Facilities Since 2000.] So, if we are drowning in stuff, unless new stuff represents something truly unique and experiential, we will ignore it.

These rental concepts - Toy Rental Service or Bag, Borrow or Steal - represent uniquely fascinating approaches to the stuff dilemma. Even sustainability and environmental responsibility are becoming unique and experiential. Authenticity comes into play, too, not to mention drawing like-minded people together into communities around shared interests and experiences.

We yearn for experiences. We're just tougher about how we evaluate them and decide to participate in them.

What about your experience? How is it? How does it reflect your consumers' zeitgeist? What do you think happens when experience economy meets recession economy?

Are you ready?

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