Elevate Your IT Company Blog

The Experience Economy

[fa icon="calendar"] Jan 17, 2019 11:09:00 AM / by Steve Satterwhite

Steve Satterwhite

We are now entering what authors Pine and Gilmore call The Experience Economy.  In other words, to compete and win in the global services market, companies must go beyond delivering basic products and services. Organizations must create superior customer experiences to drive revenue, profits, customer loyalty, and ultimately, shareholder value. 

Entelligence-Whitepaper-Customer-ExperienceThe problem is that for many companies this transition can be difficult. In this evolution, during the product economy, products were easier to sell because manufacturers and resellers relied on traditional features/functions/benefits to distinguish their products. As these products became commoditized, many manufacturers and resellers moved to adding services as a competitive differentiator. This created an even greater challenge because they are intangible, which makes it more difficult to communicate their value to the customer. 

For example, how do you translate the tangible value of an intangible service? And if selling the intangible value of services weren’t difficult, then selling the customer experience, an even more ethereal concept, presents an even greater challenge for companies trying to distinguish their value over the competition.

Think of it this way.  In the Olympics, hundreds of athletes train all their lives for the shot at the gold medal.  In a sprint, the runners line up, the gun goes off, and a few seconds later the race is over.  And what do we give the winner? The Gold – and they get their picture plastered on Wheaties Box with a big endorsement contract.  What do we give the number 2 guy? The silver. Third place – The Bronze. What do we give the 4th place finisher?  Nothing, except the memory that they were there. And yet these are some of the fastest human beings on earth. In the Olympics, the competition is brutal. 

Luckily, business is not like the Olympics. In business, you can have multiple winners. But in a highly fragmented and commoditized services market, the only real distinction will go to the winners that can clearly differentiate themselves by delivering superior customer experiences.

Mastering the superior customer experience and translating that into a competitive differentiator can be done. In the experience economy, delivering superior customer experiences creates huge opportunities to grab a large share of the evolving trillion-dollar IT services market. In fact, superior customer experiences are the only way to differentiate true value in this commoditized services market. It’s not easy and it’s not something that can be done overnight. 

Moreover, companies have a difficult time getting their organizations aligned to superior customer experiences because it doesn’t impact revenue immediately.  Since most organizations are highly focused on driving revenue on a quarterly basis, it’s difficult to get them to invest in a long-term strategy which will only pay dividends sometime in the future. It just doesn’t make the list of priorities in most organizations.

This whitepaper will provide you with some insightful research on the economic impact of delivering superior customer experiences and how the economics are vastly different than delivering merely satisfied customer experiences. It will also provide you with some tools that you can take back to your organization and put into practice.

Click here to download.

Topics: Customer Service, IT industry

Steve Satterwhite

Written by Steve Satterwhite