By Jay Michael Jaboneta
Imagine yourself back as a child… Imagine going to your science class and as the teacher is about to teach you about the Mesozoic era, instead of asking you to open your textbooks, she instructs you to put on your VR glasses. As you open your eyes, you are transported back to 150 million years ago during the Jurassic period. You see different kinds of strange-looking animals, bigger plants, and then you see dinosaurs… It’s as if you got transported to the movie, Jurassic Park, but in this case, it’s the new format that schools are using to teach natural history, the sciences, and even mathematics.
This is no longer the stuff of science fiction. The technology that allows these kinds of experiences is already here, albeit it’s still a little bit expensive. Laboratories in high-end institutions and universities across the globe are now starting to create 3D content that allows you to see and view photo-realistic environments and settings of historical periods or long-lost monuments and structures.
The dawn of what is going to be known as the Experience Economy has begun. From the agricultural economy to the industrial economy, we used to be content with just consuming goods and services.
But this is just the tip of the iceberg. The entry of the Internet and the advance of computing devices have paved the way for us to consume content and information like never before. Companies and organizations are looking to attract close to 6.8 billion potential consumers on mobile, social, and web platforms.
Our consumption habits are also changing. It started with print, then radio, then TV, then computers, and then computers with Internet. Now because of a plethora of mobile devices, we are able to consume content and services any time of the day and anywhere in the world. As a result, there is now information overload as we can see in the millions of videos, photos, and blog posts created every day.
According to studies, 80 percent of customers are looking for new consumption models. Every industry is being impacted from consumer goods to healthcare to entertainment and music, and to education.
The Customer Clearly at the Center of the Value Chain
The customer has also become the center of the value chain. Before, consumers had limited access to different channels in the consumption of news, goods, and services. Today, the consumer is king and clearly at the center. Consumers can choose to call and have their food delivered at home, they can walk into a restaurant and eat or take out, or they can just open an app on their phone and order food. These are all available to them at any time of the day and anywhere in the globe (except maybe regions where there is still no internet).
3 new consumption models are emerging:
- Subscription based models with sites like Netflix for video streaming, Spotify, and iTunes/Apple Music for music streaming, and a host of other platforms. The subscription-based model has become mainstream with most major players being bundled with your mobile phone subscription, too.
- Pay on demand models like Airbnb for accommodations, Uber and Grab for ride-sharing, and a host of other applications that allow you to “buy” a certain product or service for a period of time and pay the corresponding fee.
- Immersive technology models such as Virtual Reality and Augmented Reality where we consume content and services via the power of these new technologies that allow for fully immersive experiences.The old brick-and-mortar model is not necessarily dying but consumers now expect it to be complemented by technology such as the example of the new Amazon Go stores where consumers don’t need to line up for checkout but the technology just allows the store to detect what the consumer got in her bag and directly charges her card.
Management guru Tom Peters predicted this many years ago. He saw that, as the global economy progressed, consumers would expect more from businesses than not just products and services they could consume. Many years ago, he saw that they would increasingly look for experiences.
You don’t go to Disneyland to just buy a Mickey Mouse t-shirt or go on a roller-coaster ride. You go to Disneyland for the experience it provides for you and your family.
The Experience Economy
The era of experiences has arrived. The economic growth of the last 50 years has lifted billions out of poverty. These consumers are now demanding newer and more interactive consumption models of products and services. We don’t just buy anymore. We want to pay for a certain kind of lifestyle and we want to explore different experiences that complement our daily realities. In a sense, we want to experience different realities and this is where new technology, such as virtual reality, can come in and provide a different but almost surreal experience.
We don’t just want to buy anymore—we want to experience.
As a CEO today, part of your role is to visualize yourself as a stage manager and your business as a stage. How do you create potentially amazing and immersive experiences for your clients and customers? In the same way that a stage manager will have to form a production team of composers, scriptwriters, music producers, visual artists, and actors and actresses, the Experience Economy requires every company to re-imagine the way they operate their business much like how Disney operates its theme park. Even schools will have to increasingly create “playgrounds” that allow students to experience real-life experiences in order to be a cut above the rest.
If you want to fully understand this, I suggest you read the book Ready Player One by Ernest Cline and also catch the Steven Spielberg-directed movie of the same title that’s slated to show this month.
The future excites me and the future belongs to companies who can connect better with their customers.
Welcome to the Experience Economy.
About the Author:
Jay Michael Jaboneta is the cofounder of the Yellow Boat of Hope Foundation and Virtual Reality (VR) startup Chibot. He sits on the boards of various organizations in the country, and consults with the De La Salle – College of St. Benilde on Disruptive Technologies, Resource Mobilization, and Social Innovation.