The economy of experiences

For generations prior to the millennials, having a comfortable life meant working hard to get to enjoy a large number of possessions and properties of high economic value: houses, cars, farms, and so on. In recent years, this has been completely revalued and the present generations have completely finished with the traditional concepts of luxury, wealth and personal achievement, focusing their dreams and objectives and deriving greater pleasure and satisfaction from the experience of enriching experiences.

The younger generations have begun to rethink the need to own a car, because there are services such as Uber, or saving to buy housing, because they are so open to mobility that they prefer to live for rent. What they do value and in which they invest a large part of their income is to live quality experiences, travel, discover new places and get to know different cultures. This significant change in the way of thinking, focused on the consumption of quality services and the living of experiences, over and above the acquisition and possession of physical assets and products, companies that want to continue being successful will have to adapt quickly to new types of demand.

In tourism, luxury hotels or restaurants with many “stars” are not the destination that millennials are looking for, this new generation prefers to sleep or eat in more local, autochthonous places, where they feel surrounded by the native reality of the place they visit. The idea of renting instead of acquiring is reflected in the fact that young people do not understand the concept of buying music or buying movies on physical media and prefer subscription services or “streaming”.

In the world of fashion something similar happens as the designer Tommy Hilfiger said when he said: “I think millennials want immediate satisfaction and experiences, and that’s what we give them. Do you think someone wants to see a parade and wait six months to buy it?”. That’s why Hilfiger has changed the way it launches its collections by focusing on “see now, buy now” and making its physical and virtual stores open windows at the same time as launches and fashion shows, because new generations are impatient and want to live experiences that generate immediate satisfaction.

This new way of seeing the world begins to generate a new concept, that of the “Economy of Experiences” that tries to understand how the personal experience of the client with what he consumes, the affective valorization that makes of it, is part of a difference at the time of offering a product or service on the part of the companies. The concept of personal experiences as a motor of consumption is not new, in 1999 Joseph Pine and James Gilmore published a study that described the imminent transformation of the values of the society where experiences and what was lived had more importance than what was material.

The need to feel involved in an event or not to miss it has an incredible strength in the new generations. The feeling called “Fear of Missing Out (Fomo)” or the fear of staying outside is an increasingly important reason to buy in a world where life experiences, while intangible, take shape, are transmitted and immortalized through social networks. That is why an event or an exotic place has more value if it is “Instagrammable”.

Autor: Javier Villamizar. La República