The Experience Economy’s Joseph Pine on Actionable Ways to Engage Customers

The Experience Economy, written by B. Joseph Pine II and and James H. Gilmore, was originally published in 1999. It painted a picture of how experience could be a driver in business in a way that nobody was talking about 22 years ago.

Today, it’s widely considered part of “CX Canon,” named one of the best 100 business books of all time by Porchlight (formerly 800-CEO-Read), and an updated version was released in late 2019 including a new preface by the authors.

“We are now in an Experience Economy where experiences have become the predominant economic offering that people prefer — experiences over things.”

On a personal level, reading The Experience Economy transformed the way I looked at things and played a huge part in kicking off the customer experience journey that I’m still on today.

So you can imagine how excited I was to interview Joe Pine (as we call him) for Crack the Customer Code, the podcast I co-host with Adam Toporek.

Actually, you don’t have to imagine: You can hear it in my voice when you listen to the episode:

Key Takeaways from our Conversation with Joseph Pine

 

On the Latest Edition of The Experience Economy

The Experience Economy was published initially in 1999, and a lot has changed since then.

Back then we talked about the emerging, the forthcoming, the nascent experience economy. Today we say it’s here.

We are now in an Experience Economy where experiences have become the predominant economic offering that people prefer — experiences over things. You couldn’t quite say that 20 years ago… We could foresee it, but you couldn’t quite, quite see it.

And obviously you also have the rise of the internet and smartphones and apps, where people are always just a click or a tap away from being in somebody else’s experience… Which adds a lot to the requirements for designing great experiences.

When it comes to the latest edition of the book, the focus really is in the new subtitle, which is:

Competing for customer time, attention and money.

So the latest version talks about:

• How time is the currency of experiences
• How the smartphone is the number one competitor for every company, competing for the attention of individual customers.
• And how while money should never be the purpose of an organization, it is in fact the measure of how well you fulfill your purpose.

 

On the Core Distinction Between Services and Experiences

 

• Services are about time well saved. Get me in and out as quickly as possible. Do things I can’t do for myself that would take me too much time to do or to learn.
• But experiences are about time well spent. People actually value the time that they spend with you and in terms of attention.

And so we really focus on how you can capture attention of your customers, which is increasingly scarce today in today’s media fragmented world, so that you can create robust experiences.

 

On the 5 Adjectives of Complete Experiences

There are 5 key ways to make an experience complete. The more of these you can create, the more complete the experience.

1. Robust Experiences

A robust experience provides all four of the realms of experience: 

1. Entertainment
2. Education
3. Escape
4. Aesthetic

2. Cohesive Experiences

Cohesive experiences are about theming: what’s the organizing principle?

Theming has a bad name because of theme parks or themed restaurants where it’s in your face, but theming is simply an organizing principle for the experience. It’s how you decide what’s in the experience and what’s out.

3. Personal Experiences

This is about customization, about understanding each individual person — because our experiences happen inside of us. That’s where the experience actually is.

You need to reach inside of people to engage them, and the better you customize your goods and services to them, then the more engaging that experience that you can create.

4. Dramatic Experiences

Drama is about theater. The original sub-title of The Experience Economy back in 1999 was: Work is theater and every business a stage.

When you create a retail business, your workers are onstage, whether they know it or not. They need to act in a way that engages the audience. So you need to direct them to create the drama that really gets people engaged.

5. Transformative Experiences

This is where you use experiences as the raw material to guide people to change, to help them achieve their aspirations. You can turn your experiences into transformative experiences by focusing on what your customers aspire to become and how can you help them achieve that.

“Services are about time well saved.

But experiences are about time well spent.”

 

On the 5 Stages of Drama

The book includes a new framework, updated from one borrowed from Doblin Group long ago about five stages of drama. A Dramatic Experience should be:

1. Enticing
2. Entering
3. Engaging
4. Exiting
5. Extending

This may seem like a lot, but a dramatic experience can be had in something as simple as opening a box! Consider the unboxing experience of a well-packaged product, like Apple tends to deliver:

1. The look of the box entices you and makes you want to open it.
2. The process of opening the box is entering into the experience.
3. Whatever you pull out of the box, you’re engaged by that object.
4. The exit is the careful closing and putting way of the box
5. And the extending is the ongoing use of the product that came out of the box.

 

On the Value of Time

You are what you charge for. Joe’s said that for 20 years. And with experiences, what you want to charge for is time.

• Commodities, you charge for stuff.
• Goods, you charge for things.
• Services, you charge for activities.
• But with experiences, you charge for the time your customers spend with you.

That’s what they value, that time well spent.

One of the first places we actually saw it was American Girl Place. In 1998,  that initial American Girl Place included:

• A live theater where people paid over $30 per person for a live stage production
• A cafe where customers paid $20 for lunch or tea, or $24 for dinner for a grownup dining experience, including a place setting with your own doll.
• A photoshoot
• A hair salon
• Even a doll hospital!

“My wife flew to Chicago to take our two daughters to the American girl place the summer after it opened and they spent over four hours in the place,” Joe told us. “And when they got back to the hotel, they called me up and excitedly told me about all their experiences.

“As they were talking about this, I began to add it up in my head: they spent over $150 without buying a thing — just for the admission fee for experiences.

“But then, of course, they each came back with a huge bag filled with another doll and more clothing, more furniture, more books and all that.”

Thanks to Joe for spending time with us on the podcast. I hope it was time well spent!

 

Looking for more of Joe Pine’s Wisdom?

 

• On the web: StrategicHorizons.com
• On Twitter: @JoePine
• Frontline Video Training: OnstageTraining.com
• Listen to the full podcast episode on Spotify or wherever you get your podcasts.