I read an interesting book this month: The Experience Economy - Work is Theatre & Every Business a Stage.
It was written by Joseph Pine and James Gilmore, two respected men who have extensive marketing experience and have written several books and articles on the subject.
At first I found the book far-fetched and amusing. But then it began to make sense.
You see, Pine and Gilmore are big boosters of nontraditional advertising, such as events and parties to get consumers out to see your products.
But here is the kicker: They believe the winning companies in the next millennium must stage such dramatic, super events that they'll get standing-room-only crowds with consumers paying for admission.
That's right. Free parties won't work. The event must be so hot that consumers will pay to see that Ford or Toyota or Chevy or Dodge. And they'll wear the brand's clothing and talk about the brand to their friends.
Other companies will be left standing in the dust.
'Those businesses that relegate themselves to the diminishing world of goods and services will be rendered irrelevant,' they write. 'To avoid this fate, you must learn to stage a rich, compelling experience.'
The authors argue that consumers are yearning for connection. They're willing to spend money for that feel-good experience. No longer do they just want a commodity; even top-notch service doesn't suffice. They want experiences.
Now how do you differentiate a commodity from a service and an experience? And how do the authors try to support their hypothesis that people are willing to pay for experiences?
They used the example of kids' birthday parties. It used to be that families would buy the commodities and bake the cakes; then they started ordering the cakes at a higher cost (a service); now they take the kids to places like Chuck E Cheese's (an experience) at a much higher cost.
'Most parents don't take their kids to Disney World just for the event itself but rather to make that shared experience part of everyday family conversations for months and even years afterward,' they write. 'Those companies which capture this economic value will not only earn a place in the hearts of consumers, they will capture their dollars.'
Auto companies are no exception, they argue, pointing to Saturn - which comes closest to staging the types of experiences the authors talk about - employees surrounding a new car owner and clapping to celebrate a purchase. Thousands of Saturn owners also spent their money to attend a Saturn homecoming in 1994; thousands more are expected at the second Saturn homecoming this July.
And Saturn has the closest thing to a cult following of any brand in the industry.
'When a person buys a service, he purchases a set of intangible activities carried out on his behalf,' Pine and Gilmore write. 'But when he buys an experience, he pays to spend time enjoying a series of memorable events that a company stages.'
The authors also argue that if customers pay to see an event, companies are likely to do a better job of staging that event and positioning their products so people will continue to return.
Not everyone may agree with Pine and Gilmore. But most all auto marketers have acknowledged that they must find better ways to build relationships with consumers - this is the focus of this issue of Automotive Marketer. The marketers acknowledge that no longer will it be good enough to place an ad on TV and radio and hope consumers see it.
The advice from Pine and Gilmore: You've got to bring the people to your party, make it the hottest ticket in town and then make them happy. And to do that, you must be imaginative and brave.
According to the authors: 'Even if you reject for now the idea of charging admission out of fear, uncertainty or doubt, it should still be your design criteria.
'Ask yourself: What would you do differently if you charged admission? This exercise will force you to discover what experiences will engage guests in a more powerful way.
'Bottom line: your experience will never be worth an admission fee until you explore how to stop giving it away for free.'