In today's economy, consumers have more options than ever--and they know it. Thanks to the Internet, they can get nearly whatever they want, whenever they want it. As a result, they increasingly value great experiences and the ability to connect with other people.
This "people economy" is emotional. It's a different game, with different rules, and companies win or lose because of the feeling they give customers, not features or prices.
Here are three companies that show how great experiences lead to dedicated customers and long-term profits:
People will pay more for a consistently awesome experience.
Who loves the experience of a cab? As in, the actual experience of sitting in the back of a yellow taxi. People have put up with the shenanigans--a dirty back seat, a rude driver who refuses to accept credit cards--out of necessity. But cabs aren't the only option anymore, and many people are turning to Uber because it's a superior experience.
Order an Uber and it's yours. You can track its progress, and even pull up pictures and reviews of the driver. Once inside, the car is clean, the driver takes you where you want to go and there's no need to fret about payment (or a tip). Uber costs more than the average taxi, but its customers are willing to pay a premium because they get something for that investment.
Taxi lobbying groups are now relying on convoluted regulations and legal action to compete. Meanwhile, Uber is focusing on using experience to convince people pay more--and it's a big part of why investors value the company at more than $3.5 billion.
Experience is about more than just product.
Plenty of cafes brew coffee as good (or better) than the coffee at Starbucks. But Starbucks succeeded by making every facet of the experience enjoyable. The chairs are comfortable, there's pleasant music and Wi-Fi, the baristas are fast and friendly, and they remember your name and order. The experience is consistent and can be found nearly anywhere (sometimes directly across the street).
Starbucks invests so much to create this experience, at least in part, because the coffee alone doesn't create the experience. Starbucks is selling more than a two dollar (or more) cup of coffee. It's selling an experience that keeps customers coming back, several times a week, for those cups of coffee and chai lattes. Because of that, the lifetime value of a customer isn't the value of one coffee; the lifetime value is a customer that will shop at Starbucks multiple times per week for many years.
People come back when the experience stays with them.
Brands themselves can become an experience--and none more than Apple. In both mainstream and tech circles, there's an obsession with what made Apple--and the late Steve Jobs--click.
The overall Apple experience, from shopping at one of the company's stores to opening the box of a new product, is beautifully designed and consistent. Music, photos and contacts automatically sync across all devices, and everything 'just works." Love Apple or hate Apple, there's no doubt that you feel Apple when you walk into a store or listen to music on iTunes.
These are just examples, and you won't win by trying to replicate the feel of Apple or Starbucks or Uber. Every company must have a feel all its own. Great experiences--not features or price--determine the winners and losers in a people economy. What is your company doing to provide a memorable experience?