EXPERIENCES ARE EVEN MORE important in a Socially Distant World
Manage them Intelligently
It would be easy to conclude that the hype surrounding the Experience Economy is over, following the world-changing events of 2020. Physcial distancing has been mandated by governments across the globe, consumers are hunkering down in the safety of their homes, rarely venturing out and digitial engagement, along with touchless technologies, have exponentially increased. However, it can be argued that in fact, quite the opposite is true; that the Experience Economy, now, is more important than ever before. And here’s why. As companies try to connect with their consumers, employees and partners; as they try and meet the unmet and unarticulated needs of their stakeholders, the experiences they deliver, at this critical inflection point of our history, will be more important than ever to their long term success.
4TH QUARTER 2020
By Rudeon Snell, Global Senior Director: Industries & Customer Advisory at SAP
SYNAPSE
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AS A CONCEPT, the Experience Economy is not new. A 1998 article in Harvard Business Review titled ‘Welcome to the Experience Economy’ highlighted how leading companies understood that “the next competitive battleground lies in staging experiences.” Products and services were no longer seen as differentiators. By 2017, McKinsey had declared ‘Experiences are king’ as their research confirmed how consumers had gradually shifted their expenditure from products to experiences. In their report, McKinsey found that personal consumption expenditure on experiencerelated services had grown 1.5 times faster than total personal consumption spending and nearly four times faster than expenditure on products. Gartner even declared that 2019 would be the year that experience overtake product and price as the main competitive differentiators for brands and businesses. Positive, hyper-personalised experiences were now required to sweeten the deal for consumers.
Rise of Intelligent Experiences
In line with the rise of exponential technologies such as Artificial Intelligence, Big Data and the Internet of Thing, the concept of the Experience Economy has also evolved over the past few years. Today, successful businesses manage their experiences as a
core strategic business capability. They have seen how customers are willing to pay more for experiences. They understand that the value needle has shifted. This new approach is powered by Intelligence. Intelligent Experience Management leverages the power of exponential technologies - AI, IoT, advanced analytics - to drive a more optimal customer, employee, product and brand experiences. This relentless focus on value delivery through enhanced experiences, is what will allow enterprises to win in today’s market. And these exponential technologies powering differentiated business capabilities, are vital to the long term success of enterprises, because of the volume and nature of data that informs modern Experience Economy strategies. Traditionally, organisations relied heavily on operational data - revenue, inventory, suppliers, workforce - to make decisions, but today they need insights from a different type of data to augment the value their provide to their customers; they need experience data. Experience data provides insights into the sentiment and emotional aspects that influence a customer, employee, partner or supplier decisions towards a brand. In short, operational data reveals what is happening in an organisation, and experience data reveals why and how it is happening. An Intelligent Experience Management strategy would
