Experience Economy

Experience Economy

People should remember – Buying experience

Cake Preparation:

· Make own cake from scratch – Extract commodities

· Get premixed ingredients – Make Goods

· Order cakes – Deliver services

· Outsource the birthday party – Stage experience (Emerging economy)

Experience – It is an interaction of staged event and individual state of mind

Engage all 5 senses of the customer. Remember order of customer without asking

Why is marketing important?

Increase price of product by creating brand. Sell customer at a premium or sell at large volume

Customer, Employees, Suppliers, Bankers, Government, Shareholder – Community. Shareholders are the last stakeholders in this queue.

Marketing is bridge between customer and shareholders by satisfying shareholders by serving customers.

Role of Marketing: Need to increase profit by cutting cost

Market Capitalization – No of shares * Price of one share. Ability to deliver in future & at current profit.

It shows the worth of the company. It has both intangible asset (Goodwill, Patent, Copyright, Licenses, brands, people / HR) & tangible asset (land, depreciation, inventory, fixed asset).

Power Brands – They cultivate customer relationship by taking conscious effort (TRUST = BRAND)

Rethinking marketing – Build customer relationship, brand automatically builds. Take initiatives. Powerful brand sustain profitability & growth (Low cost of acquisition).

Marketing Practices

1. Slimming the innovation pipeline – Focus on 2-3 varieties rather than all the products

2. Portfolio management – Discard some of the products, focus on selected segment (High impact, innovation, R&D)

3. Intangibles (like consultant service – How to plant, pH level of soil, increase the fertility of the soil)