16. Ray Oldenburg, The Great Good Place: Cafés, Coffee Shops, Community Centers, Beauty Parlors, General Stores, Bars, Hangouts and How They Get You Through the Day (New York: Marlowe & Company, 1997).
17. In The Theming of America: Dreams, Visions, and Commercial Spaces (Boulder, CO: Westview Press, 1997), 115, Mark Gottdiener points out that many themed environments fulfill “the desire for community and pedestrian communion in public spaces, along with what is often a much-needed holiday from the normal routines of everyday life. People seem to crave this street-level intimacy—a need created by the destruction of public space in contemporary society through suburbanization and the terror of urban crime.”
18. The concept of flow experiences is applied to those of the esthetic kind in Mihaly Csikszentmihalyi and Rick E. Robinson, The Art of Seeing: An Interpretation of the Aesthetic Encounter (Malibu, CA: J. Paul Getty Museum and the Getty Center for Education in the Arts, 1990).
19. The live butterflies placed in the first prototype store had the unfortunate habit of dropping onto customer's plates.
20. Quoted in Chris Niskanen, “Big Big Business,” St. Paul Pioneer Press, March 29, 1998.
21. Michael Benedikt, For an Architecture of Reality (New York: Lumen Books, 1987), 4.
22. Ibid., 48. We argue, however, that architectural masterpieces are similarly “non-real” in that they are only constructions of our own making. If Benedikt's own definition were taken literally, the only truly esthetic experiences would occur when one is immersed solely in God's creation.
23. Ada Louise Huxtable, The Unreal America: Architecture and Illusions (New York: New Press, 1997), 75.
24. For more on the Experience Economy and authenticity, see James H. Gilmore and B. Joseph Pine II, Authenticity: What Consumers Really Want (Boston: Harvard Business Press, 2007), chapter 6 in particular.
25. Huxtable, The Unreal America, 58.
26. Tom Carson, “To Disneyland,” Los Angeles Weekly, March 27, April 2, 1992. Carson also quotes Charles Moore, from the book The City Observed, in a chapter on Disneyland, saying, “People often use Disneyland as a synonym for the facile, shallow and fake. It just doesn't wash: this incredibly energetic collection of environmental experiences offers enough lessons for a whole architectural education in all the things that matter—community and reality, private memory and inhabitation, as well as some technical lessons in propinquity and choreography.”
27. Charles Goldsmith, “British Airways's New CEO Envisions a Marriage of Travel and Amusement,” Wall Street Journal, November 6, 1995.
28. Other Unique Experiences periodically offered by American Express include a customized Napa Valley Wine Country tour, a New York culinary experience at the French Culinary Institute, a country music extravaganza, and a Champagne harvest at Veuve Clicquot in France. Treating these offerings as economic experiences, American Express requires a huge number of reward points be redeemed, sometimes as high as half a million, meaning $500,000 would ordinarily have been charged to the card member's American Express card!
29. Anthony Rooley, in Performance: Revealing the Orpheus Within (Longmead, UK: Element Books, 1990), 108–109, delineates seven stages of any performance that seem to spiral around the sweet spot: “The arts must delight in order to attract our further attention, and lead us subtly to a more profound contemplation. This happens in seven stages during a performance as it:
delights the senses
invites curiosity
involves the mind
encourages deeper study
encourages regular practice
expands love
opens up knowledge”
30. Witold Rybczynski, Home: A Short History of an Idea (New York: Penguin Books USA, 1986), 66.
31. Ibid., 62.
32. See James H. Gilmore and B. Joseph Pine II, foreword to The Power of the 2×2 Matrix: Using 2×2 Thinking to Solve Business Problems and Make Better Decisions, by Alex Lowry and Phil Hood (San Francisco: Jossey-Bass, 2004), xv.
Chapter 3
1. A look at the origin of the English word theme explains this relationship between theme and place. John Ayto, Dictionary of Word Origins (New York: Arcade Publishing, 1990), 527, tells us that the “Greek théma denoted etymologically ‘something placed,’ hence a ‘proposition’ (it was formed from the base *the-, source of tithénai ‘place, put’ and distant relative of English do). English acquired the word via Latin thêma and Old French *teme as teme, but soon reverted to the Latin spelling.” Experiences occur in places, and the best of those places are themed.
2. James Champy, Reengineering Management (New York: Harper Business, 1995), 56–57. See also I. Jeanne Dugan, “The Baron of Books,” BusinessWeek, June 29, 1998, 108–115.
3. Quoted in Bob Thomas, Walt Disney: An American Original (New York: Hyperion, 1994), 11.
4. Ibid., 13.
5. Ibid., 247.
6. Ibid., 246.
7. For a comprehensive look at the Geek Squad's theming, see Gosia Glinska, James H. Gilmore, and Marian Chapman Moore, The Geek Squad Guide to World Domination: A Case for the Experience Economy DVD-ROM (Charlottesville, VA: Darden Business Publishing, 2009).
8. For a great article on the art of storytelling applied to new media such as CD-ROMs and the World Wide Web—but generally applicable beyond that—see Brent Hurtig, “The Plot Thickens,” New Media, January 13, 1998, 36–44.
9. Randy White, “Beyond Leisure World: The Process for Creating Storyline-Based Theming,” FEC Magazine, November–December 1998.
10. Mark Gottdiener, The Theming of America: Dreams, Visions, and Commercial Spaces (Boulder, CO: Westview Press, 1997), 144–151. In Marketing Aesthetics: The Strategic Management of Brands, Identity, and Image (New York: Free Press, 1997), 137–139, Bernd H. Schmitt and Alex Simonson recommend that corporations use as a source of themes the five cultural domains of the physical world; philosophical/ psychological concepts; religion, politics, and history; the arts; and fashion and popular culture. They also suggest (pp. 129–135) that companies relate themes—which the authors define as “the content, the meaning, the projected image of an identity” (p. 124)—to their mission, vision, objectives, and strategies; core capabilities; legacy; corporate or brand personality; and values. For existing corporations, we think it's especially important to honor the legacy of the business.
11. Schmitt and Simonson, Marketing Aesthetics, 128–129.
12. For more on Mike Vance's “Kitchen of the Mind,” see Mike Vance and Diane Deacon, Think Out of the Box (Franklin Lakes, NJ: Career Press, 1995), especially 96–97 and 103–109.
13. Henry M. Morris with Henry M. Morris III, Many Infallible Proofs: Evidences for the Christian Faith (Green Forest, AR: Master Books, 1996), 118. Morris further points out that each of the three entities of the tri-universe is itself a trinity: space has three dimensions; matter can be energy, motion, or phenomena; and time has past, present, and future.
14. So good is Lori's faithful re-creation of the 1950s diner that about the only thing that intrudes on the illusion are the drinks offered on the menu and the earrings on the waiters and the tattoos on the waitresses. The restaurants are, after all, located in San Francisco.
15. Schmitt and Simonson, Marketing Aesthetics, 172–185.
16. Roget's International Thesaurus, 4th ed., rev. Robert L. Chapman (New York: Harper & Row, 1977), xvii–xxiv. Never purchase a thesaurus in dictionary form; the categorized version is the only way to go.
17. CEO Betts and his team orchestrated such an engaging experience that in February 1997 The Walt Disney Company itself honored East Jefferson with its “Mouscar” Award—a takeoff on the Oscar that had never before been bestowed outside Disney. Betts quipped, “It no longer bothers me when people refer to the hospital as ‘a Mickey Mouse operation.’”
18. Regarding mechanics, there is a significant discussion in the literature on the marketing of services on “servicescapes,” a term coined by Arizona State University professor Ma
ry Jo Bitner to describe the physical surroundings of (what are generally thought of as) service providers. It is very similar to what Carbone calls “mechanics clues.” See, for example, Mary Jo Bitner, “Consumer Responses to the Physical Environment in Service Settings,” in Creativity in Services Marketing, eds. M. Venkatesan, Diane M. Schmalensee, and Claudia Marshall (Chicago: American Marketing Association, 1986), 89–93; Mary Jo Bitner, “Servicescapes: The Impact of Physical Surroundings on Customers and Employees,” Journal of Marketing 56, no. 2 (Spring 1992): 57–71; Kirk L. Wakefield and Jeffrey G. Blodgett, “The Importance of Servicescapes in Leisure Service Settings,” Journal of Services Marketing 8, no. 3 (1994): 66–76; and, for an entire book dedicated to the subject with numerous excellent articles, John F. Sherry Jr., ed., ServiceScapes: The Concept of Place in Contemporary Markets (Lincolnwood, IL: NTC Business Books, 1998). Perhaps the first article in this vein was Philip Kotler, “Atmospherics as a Marketing Tool,” Journal of Retailing 49, no. 4 (Winter 1973): 48–64.
19. Donald A. Norman, Turn Signals Are the Facial Expressions of Automobiles (Reading, MA: Addison-Wesley, 1992), 19.
20. Tom Huth, “Homes on the Road,” Fortune, September 29, 1997, 307, emphasis added.
21. As Alvin Toffler predicted long ago in Future Shock (New York: Bantam Books, 1970), 226, consumers would one day “begin to collect experiences as consciously and passionately as they once collected things.”
22. Leonard L. Berry, On Great Service: A Framework for Action (New York: Free Press, 1995), 10.
23. Ibid., 91.
24. Anthony Rooley, in Performance: Revealing the Orpheus Within (Longmead, UK: Element Books, 1990), 103–104, points out, “The five senses form two distinct levels: smell, taste, and feeling belong to the body and are the lower senses, providing essential information for good functioning; sight and hearing feed the mind.”
25. One could say that British Airways and other airlines do charge customers just for entering their “place,” but here the “just” is important. Even though they control the entire immersive environment of an airplane, they don't charge just for getting on it but for the service of transporting people from one city to another. Interestingly, Israeli airline El Al had an offering it called the Flight to Nowhere, in which it charged large groups the equivalent of about $85 to fly on a plane, eat dinner and dessert, sing songs, and watch movies. According to El Al spokesman Nachman Kleiman, “You don't necessarily have to go to London or Paris to have a good time.” Associated Press, “Israeli Airline Offers ‘Flight to Nowhere,’” Daily Tribune (Hibbing, MN), December 29, 1997. In contrast, one of the reasons that Planet Hollywood and other theme restaurants have trouble is that they do not charge admission. Because the entire experience is paid for by consumers through the price of their meals, they impute a higher value to the food, which does not (indeed, cannot) live up to their expectations. A cheeseburger must be awfully good to justify an $8.95 price tag; with a $5 admission fee, however, a $3.95 burger doesn't have to be nearly as good—as long, of course, as the experience itself is worth $5.
26. Ozlem Sandikci and Douglas B. Holt discuss this phenomenon in “Malling Society: Mall Consumption Practices and the Future of Public Space,” in Sherry, ServiceScapes, 305–336, calling it “product foreplay.” They even suggest (333–334) that the next step in the “evolution of the mall” will be for mall operators “to sell this space to consumers” because “mall development is driven by the need to commodify [i.e., sell as something of value] social experience.”
27. “Niketown Comes to Chicago,” press release, Niketown Chicago, July 2, 1992, cited in Sherry, “The Soul of the Company Store: Niketown Chicago and the Emplaced Brandscape,” in his ServiceScapes, 109–146.
28. In nearly every mall in the United States, developers failed to capture revenue for the experience occuring before store doors open every morning, namely, senior citizens valuing the space as a place to walk. The owners should charge admission for the escapist value created for guests.
Chapter 4
1. “Fiscal Year 2010 Financial Charts,” Dell, http://content.dell.com/pr/en/corp/d/corp-comm/fy10-financial-charts.aspx.
2. “Michael Dell Email to Employees,” The HR Capitalist, http://www.networkworld.com/news/2007/013107-dell-ceo.html.
3. For more on Mass Customization, see Stanley M. Davis (who coined the term), Future Perfect (Reading, MA: Addison-Wesley, 1987), also available in a tenth anniversary edition from the same publisher; B. Joseph Pine II, Mass Customization: The New Frontier in Business Competition (Boston: Harvard Business School Press, 1993); B. Joseph Pine II, Bart Victor, and Andrew C. Boynton, “Making Mass Customization Work,” Harvard Business Review 71, no. 5 (September–October 1993): 108–119; for manufacturers only, see David M. Anderson, Agile Product Development for Mass Customization (Chicago: Irwin Professional Publishing, 1997); and Bart Victor and Andrew C. Boynton, Invented Here: Maximizing Your Organization's Internal Growth and Profitability (Boston: Harvard Business School Press, 1998).
4. There are at least six types of modularity (as well as myriad ways of implementing each type, depending on a company's particular circumstances); see Pine, Mass Customization, 196–212. Other good resources on this topic include Karl T. Ulrich and Steven D. Eppinger, Product Design and Development (New York: McGraw-Hill, 1995); G. D. Galsworth, Smart, Simple Design: Using Variety Effectiveness to Reduce Total Cost and Maximize Customer Selection (Essex Junction, VT: Omneo, 1994); Toshio Suzue and Akira Kohdate, Variety Reduction Program: A Production Strategy for Product Diversification (Cambridge, MA: Productivity Press, 1990); Ron Sanchez and Joseph T. Mahoney, “Modularity, Flexibility, and Knowledge Management in Product and Organization Design,” Strategic Management 17 (December 1996): 63–76; Marc H. Meyer and Alvin P. Lehnerd, The Power of Product Platforms: Building Value and Cost Leadership (New York: Free Press, 1997); and Carliss Y. Baldwin and Kim B. Clark, “Managing in an Age of Modularity,” Harvard Business Review 75, no. 5 (September–October 1997): 84–93. The six types of modularity discussed in Mass Customization are based on earlier work by Ulrich and one of his students.
5. This is something one of the authors of this book got wrong in his earlier Mass Customization.
6. Quoted in Clayton Collins, “Five Minutes with J. D. Power III,” Profiles, October 1996, 23.
7. Add up all the sacrifice existing across all these dimensions—each designed for the average—and one begins to understand why airline travel generally provides such an unpleasant experience. The biggest sacrifice customers encounter, of course, is arriving at an airport terminal when where they want to be is at home, a hotel, or some other specific destination—a sacrifice impossible to eliminate, short of a Star Trek–like transporter. Virgin Airways at least reduced it through its program of picking up and dropping off upper-class passengers in limousines—a much better experience than the antics required to get in and out of the typical airport. Airlines could further reduce this sacrifice by allowing passengers to act as if they were already at their destinations—by providing onboard check-in with rental cars and hotels, along with transferring bags directly to the final destination.
Chapter 5
1. Daniel Roth, “Netflix Inside,” Wired, October 2009, 124.
2. Dorothy Leonard and Jeffrey F. Rayport, “Spark Innovation Through Empathic Design,” Harvard Business Review 75, no. 6 (November–December 1997): 104.
3. For more on Ross Controls, see Steven W. Demster and Henry F. Duignan, “Subjective Value Manufacturing at Ross Controls,” Agility and Global Competition 2, no. 2 (Spring 1998): 58–65.
4. For more information on learning relationships, see B. Joseph Pine II, Don Peppers, and Martha Rogers, “Do You Want to Keep Your Customers Forever?” H arvard Business Review 73, no. 2 (March–April 1995): 103–114. Robust details on one-to-one marketing can be found in Peppers and Rogers's fine books, The One to One Future: Building Relationships One Customer at a Time (New York: Currency Doubleday, 1993),
and Enterprise One-to-One: Tools for Competing in the Interactive Age (New York: Currency Doubleday, 1997). All marketers and anyone else concerned with how their companies should adapt to a world filled with interactive technologies should read these books.
5. Of course, as with the old learning curve, the path followed is never as smooth as that pictured.
6. For more information on these four approaches, see the original article on which this section is based: James H. Gilmore and B. Joseph Pine II, “The Four Faces of Mass Customization,” Harvard Business Review 75, no. 1 ( January–February 1997): 91–101.
7. For more on Lutron, which practices collaborative and cosmetic as well as adaptive customization, see Joel S. Spira and B. Joseph Pine II, “Mass Customization,” Chief Executive 83 (March 1993): 26–29, and Michael W. Pessina and James R. Renner, “Mass Customization at Lutron Electronics—A Total Company Process,” Agility and Global Competition 2, no. 2 (Spring 1998): 50–57.
8. For a discussion of the benefits of adaptive over collaborative customization, see Eric von Hippel, “Economics of Product Development by Users: The Impact of ‘Sticky’ Local Information,” Management Science 44, no. 5 (May 1998): 629–644.
Intermission
1. Quoted in Steven E. Prokesch, “Competing on Customer Service: An Interview with British Airways' Sir Colin Marshall,” Harvard Business Review 73, no. 6 (November–December 1995): 106.
2. T. Scott Gross, Positively Outrageous Service: New and Easy Ways to Win Customers for Life (New York: MasterMedia Limited, 1991), 5–6. Gross defines positively outrageous service as “unexpected service delivered at random … It is a memorable event and is so unusual that the customer is compelled to tell others.” See also Gross, Positively Outrageous Service and Showmanship: Industrial Strength Fun Makes Sales Sizzle!!! (New York: MasterMedia, 1993), which discusses “signature showmanship” and “retail theater.” Because Macaroni's has since been expanded into the restaurant chain Romano's Macaroni Grill, apparently it lost its wonderful customer surprise in the process of becoming a chain.
The Experience Economy (Updated Edition) Page 31