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Category Archives: Experience Economy

Creating Experiences through Cooperation

It is clear as we look around…….the experience economy is upon us. The Tourism and Hospitality industry in particular is striving to grasp the concept of creating experiences for its consumers. You only have to look at business such as Yo Sushi, Dinner in the SkyVirgin Galactic and many of the hotels being built in the UAE to realise that ‘experiences’ are number one for future competitive advantage.   

But what about smaller business and the destinations they operate in? It is a fact, that although we talk about large multinational companies, it is the smaller businesses that make up the majority of the Tourism and Hospitality industry. So, how can these small businesses strive to create ‘memorable experience’ to their customers? I believe the answer is co-operation. This method of business has been around for years in the form of ‘package holidays’ and has proven extremely successful. This can be implemented on a much smaller scale to draw a number of smaller experiences into a ‘memorable experience’.Virgin Galactic and many of the hotels being built in the UEA to realise that ‘experiences’ are number one for future competitive advantage.

Examples of Co-operation

Co-operation can be as small as holding a leaflet on a local attraction, but here are a few (and only a few) examples of businesses that co-operate to enhance the experience for their customers:

Rail and 2for1 London provide travel, plus discount on many of London’s top attractions

Premier Inn and Beefeater provide comfortable accommodation with great food

Alton Towers and Local Hotels/B&B’s provide a day out to remember with a comfortable nights sleep

London Hotels and Theatre Companies provide accommodation in the heart of London with a great night at the theatre

Las Vegas Attraction Passes provides tourists with an array of experiences for a single price

What are the Benefits?

Co-operation provides a number of benefits for Tourism and Hospitality businesses, and the wider community that they operate in:

1. Small businesses with limited scope are able to combine a number of experiences into a ‘memorable experience’ through effective co-operation with other local businesses. An example of this would be a small hotel co-operating with a restaurant or local attractive by providing a discount.

2. Business can take advantage of ‘free’ marketing and visa versa. This is great for smaller businesses who rely on ‘free’ advertising.

3. Destinations become more appealing to tourists, supporting the notion of sustainable tourism. This allows smaller businesses to make a difference to the destination they operate in by increasing tourism.

4. Transport links and the final destination can co-operate to create experiences. Such as Rail and London 2for1. This idea gives tourists a reason to visit a destination (which are usually made up of small businesses) due to the discounts they will receive.

5. A single transaction cost, such as the Las Vegas attraction pass can create the perception of value for money. Also this reducing the negative feelings associated with payment, as an experience can be paid for in a single transaction. This idea allows an array of small businesses to work together to create a ‘memorable experience’.

Are there any drawbacks?

Although co-operation can create a number of fantastic benefits for Tourism and Hospitality Business, there are a number of potential drawbacks:

1. Co-operation often depends on the management of a mutual relationship. Each party places trust on others to create a positive experience for customers.

2. Similar to the first point, to some extent, co-operation places your reputation in someone else’s hands. A poor experience in any part of the wider experience could have a negative impact on your business.

3. Managing money can also be an issue, especially if the customer is paying for the experience as a whole. Who receives the payment? How long do they hold it for? What percentage do you receive? And when?

4. Maintaining the experience in the long-term can also be an issue. Businesses change their management and strategic direction. Will you ‘fit’ or be part of this?

The key to survival?

Having considered the idea of co-operation in creating experiences, it is clear that it holds many benefits for Tourism and Hospitality businesses. As we continue to develop and become more intelligent consumers, it is clear that ‘experiences’ are the key to creating sustainable competitive advantage. As many small businesses have limited scope, co-operation may become increasingly important as a key to survival and profitability. Co-operation should be considered as a potential way for small businesses to create ‘memorable experiences’ in the future.

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Posted by on September 30, 2011 in Destinations, Experience Economy

 

10 Rules for Creating Memorable Experiences

As we move from the ‘service economy’ to the ‘experience economy’, Tourism and Hospitality businesses can no longer rely on ‘great service’ as a source of sustainable competitive advantage. Businesses must understand the key fundamentals in creating ‘memorable experiences’ to their customers.

Virgin Galactic, The Burj Al Arab (or Dubai as a whole for that matter), Las Vegas and Macau to name a few, have all found innovative ways of creating ‘experiences’. So how have these businesses been successful? Well after some research I have created 10 rules from creating ‘memorable experiences’:

1. Cooperation is key – in today’s economy businesses should strongly consider cooperation as a form of creating experiences. Hotels, attractions, transport links, restaurants and bars combined into some form of package can create memorable experiences to consumers. In addition this can also give the consumer a perception of ‘value for money’ and reduce the number of transaction costs associated with an ‘experience’. In many cases this exists today, however, businesses should consider this carefully.

2. Keep it current – one word…………..technology! Consumers have considerable power and choice with the internet and access to information. You must take advantage of this and use technology to promote the experience. In many cases businesses can allow the consumer to ‘taste’ the experience before even arriving through video, virtual walk through, pictures and even sounds.. You need to carefully consider the possible uses of technology (including social media) as a vehicle in promoting the experience.     

3. Create an ‘experience culture’ – business must promote an ‘experience culture’. Successful delivery of experiences is very much dependant on the culture of your business. Therefore, businesses should ‘win’ over internal customers (your staff) in order to deliver successful experiences. How to do this? Create an ‘experience culture’ and allow your internal customers to experience the experience and most importantly, provide feedback.

4. Have a system for innovation – ideas will always fly around and come from a variety of sources. Make sure you have a system to capture, collate and identify potential winners. Allow your internal customers to generate ideas and reward them for doing so….your next big idea could be hiding somewhere.

5. Training…..and more training – words can not express how important training is in the delivery of an experience. Every business claims to have a great training program but does your training program concentrate on the experience you wish to provide to your customers? Do your staff deliver memorable experiences to your customers? Of course, every business will be different but training should also be focused on the experience. I like to call this ‘experience focused training’, an area which should not be considered lightly.

6. Know your customers – know your different types of customers, know when to change your experience according to their needs, know your internal customers and know anyone that has input into your experience (including your suppliers). All of these groups are important in providing feedback, ideas and innovations to your overall experience.

7. Take advantage of feedback – feedback is absolutely essential in creating and fine tuning memorable experiences. The important point to note here is that feedback comes from your internal and external customers. Businesses must find way to capture feedback from both parties and use it to fine tune experiences.

8. Learn from the best – if a business is getting it right, be sure to find out why. I named a few in the introduction to these rules, which should give you a start. Now, I don’t mean copy everything that business does, but learn what is good and find ways to implement similar ideas into your business.

9. Create a lasting experience – successful experiences last forever! Find methods to creating lasting experiences which people will talk about and tell their friends. This could include something to take away (physical), something to talk (mental) about or something to show. You need to ensure that your customers go away, talk about the experience you offer and return with an army of followers.

10. Break it down – linking a number of rules together is the ability to break the experience down in to sections. Use technology to create a ‘pre experience’, use your internal customers and cooperation in the ‘live experience’ and give your customers something to take away for the ‘post experience’. Bring these three together to form a coherent and powerful experience and watch your customers grow.

Please note: This article is published for information only and any recommendations given are the opinion of the author and therefore, should only be used if the reader feels they are applicable.

 
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Posted by on August 2, 2011 in Experience Economy

 

The Experience Economy: Is your Hotel Business Ready?

Article: Adam Beck discusses the ‘experience economy’ and what Tourism and Hospitality businesses should think about for the future.

Welcome to the Experience Economy

Over the past two decades, academics and industry professionals have encouraged the notion of creating ‘memorable experiences’, and argue that it is these experiences that ultimately sell the product or service (Morgan et al, 2010). Pine and Gilmore first highlighted the importance of the ‘experience economy’ in a famous article released in 1991, which stated ‘Work is Theatre and Every Business a Stage’ (Pine and Gilmore, 1991).

The main driving force of this is undoubtedly the growth of internet (Pine & Gilmore 1991). Although consumers have always had a choice over products and services, the internet has considerably shifted the balance of power (Pantelidis, 2010). Therefore, it is more important than ever for Hospitality and Tourism businesses to find innovative ways of creating and consistently delivering unique ‘memorable experiences’ to gain long-term competitive advantage (Hemmington, 2007).

Forward Thinking Organisations: Who is Leading the Way?

Forward thinking and revolutionary organisations are already leading the way in providing ‘memorable experiences’ that add value to consumers lives (Hemmington, 2007):

  • A major contributor in food service is Michelin star and celebrity chef Heston Blumenthal. His unique and unconventional style of preparing, presenting and serving food at The Fat Duck has caught the attention of consumers (Harris, 2003; The Fat Duck, 2011). The Fat Duck also incorporate smells and sounds to engage the five senses
  • Other examples included Naked Sushi (eating sushi from models) and Inamo Restaurant (where you can order on an interactive tale).
  • Las Vegas themed hotels such as the Venetian (Venice) and Treasure Island (Pirate) attempt to capture consumers through unique experiences. Many of these hotels also have themed rooms, pools, restaurants and bars which help to define the experience (Pine and Gilmore, 1991).
  • Hotels such as the Atlantis and Burj Al Arab (United Arab Emirates) have a unique ability of using the internet to build ‘experiences’ through interactivity, pictures, videos and sounds (Burj Al Arab 2011; Atlantis the Palm 2011).
  • Theme parks such as Alton Towers now cooperate with local accommodation providers to create ‘packaged experiences’. Also, many London attractions cooperate with other attractions and transport links providing deals and packages to consumers.
  • Disney has been successful due to the culture of its employees in promoting genuine ‘experiences’. Staff are considered the ‘cast’ and they are either ‘onstage’ or ‘’backstage’, they are trained using scripts and rewarded for creating exceptional ‘experiences’ (Morgan et al, 2008; Pine & Gilmore 1991).

Recommendations for Tourism and Hospitality Businesses

Keeping it Current: Using Technology as a Vehicle

Currently over 27% of the world population have access to the internet (see appendices) which equates to some 2 billion people (IWS, 2011). Although, these statistics present great opportunities, the Tourism and Hospitality industry is notorious for ‘falling behind’ with technology in general (Law & Jogaratnam, 2005; Buhalis & Law, 2008; Daniel Thomas, 2010). To remain competitive organisations should consider the following:

  1. Using virtual walk through to create a sense of ‘already being there’ (Cho et al., 2002)
  2. Adding music and sounds to create atmosphere
  3. Using words which are connected to the type of feelings to expect (Law & Hsu, 2006)
  4. Have quality pictures to build the experience
  5. Adding videos to allow the consumers to ‘see’ what they are likely to experience (Pantelidis, 2010)
  6. Designing interactive websites which is key to keeping the interest of consumers (Pantelidis, 2010)
  7. Managing social media and online advertising which will become increasingly important (Pantelidis, 2010)

Working Together: Cooperation in Building Experiences

One method which will become increasingly important, particularly in the case of small businesses, is generating ‘experiences’ through cooperation. This contemporary practice creates an ‘experience’ and has proven popular in recent years under the ‘all inclusive’ package. Tourism and Hospitality businesses of the future will need to build ‘experiences’ by cooperating with other local businesses such as hotels, restaurants, attractions and transport links. Not only can this reduce the number transactions a guest pays during the ‘experience’ (Hemmington, 2008; Tisch, 2007), it can also add a perception of value for money which is so important in today’s economy. This strategy also supports the notion of sustainable tourism which is so vital for many destinations today. Organisations should consider:

  1. Cooperating with others to build ‘memorable experiences’
  2. Building ‘packages’ with other organisations to create an ‘overall’ experience
  3. Marketing ‘experiences’ by cooperating with other organisations
  4. Reducing the number of transaction costs to give a perception of ‘value for money’

Making it Happen: Building a Solid Infrastructure for Success

Organisations should also understand that the most important factor is building a solid infrastructure around the delivery of the ‘experience’. Organisations should consider:

  1. Deliberately designing experiences using core competencies (strengths) as a basis (Pine and Gilmore, 1991; Lugosi, 2008).
  2. Thinking of the transaction as an ‘admission charge’ and how this would change the way things are done (Pine and Gilmore 1991).
  3. Creating ‘roles’ for key members of staff in the delivery of an ‘experience’ (Lugosi, 2008).
  4. Carefully considering staff as they are ultimately the individuals and teams that will be delivering the ‘experience’. Continual training, guidance and coaching are all important for success (Morgan et al, 2008; Shaw & Ivens, 2002).

Conclusions

It is clear from this report that a number Tourism and Hospitality organisations have already taken measures to adapt to the ‘experience economy’. Technology, cooperation and a solid infrastructure are key to designing, delivering and maintaining quality and consistency. Organisations must learn from these forward thinking ideas in or risk being left behind in rapidly changing global economy.

Please note: This article is published for information only and any recommendations given are the opinion of the author and therefore, should only be used if the reader feels they are applicable. A full reference list is available on request via email.

 
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Posted by on April 22, 2011 in Experience Economy, Technology