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Latest Observations

As keen observers of emerging business and competitive phenomena, Pine & Gilmore frequently identify noteworthy issues and challenges facing many organizations.  Here you'll find some of their latest thoughts, commentary and musings. Previous observations are housed in The Vault.

 

Design: The Means to the End

By Jim Gilmore

The topic of "Design" is getting much media attention today -- and rightfully so. Focusing on traditional features and benefits of goods and services is no longer enough to innovatively differentiate one's offerings, and an appreciation of -- and a commitment to -- design is critical in bringing new value to the marketplace. But with Design (with a capital "D") grabbing so many headlines, it's easy for organizations to treat the discipline as an end in itself. There is great danger in that -- witness the untold trade show booths that win design awards but fail to actually drive new business revenue.

Those interested in design should be sure to read the interview with P&G CEO A.G. Lafley in the June 2005 issue of Fast Company. (See cover story: "What P&G Knows About the Power of Design".)  And see too my letter to the editor in the August 205 issue: "Feedback".)

It's not important whether Fast Company confuses the ends with the means, as long as the Lafleys and P&G's of the world understand the distinction!

 

Your Competition? The World

By Joe Pine

In my work with companies, I often make one very simple point: In the Experience Economy, you compete with every other company in the world. The equally simple reason for this: Customers (whether consumers or businesses) have only so much time, attention, and money to spend.

Money is fungible, meaning if a customer purchases some economic offering (whether a commodity, good, service, experience, or transformation) from some other company, then that’s money they’re not spending with you. Everyone has finite resources; if your offerings do not provide more value to customers than their other options, you will not get their business.

That’s assuming you get their attention first, of course. But attention is scarce in the Experience Economy. That’s why you see companies of all stripes staging marketing experiences – physical or virtual places so engaging that current and potential customers can’t help but pay attention, and pay up as a result by buying their offerings. All stripes? Indeed; you can see marketing experiences effectively employed in commodities (Pike Place Fish Market’s fish-throwing experience), goods (American Girl Place’s theatre and other experiences), services (the ING Direct Café), experiences (the Fremont Street Experience drawing people to downtown Las Vegas), and transformations (Starizon’s paid sales visits to its Experience Design Place in Keystone, CO).

Once you get their attention, then you can get them to spend time with you. Unfortunately, time is limited; there’s only so much time anyone can spend experiencing anything – 24 hours a day, seven days a week, 365 days a year. (And most of us have to fit sleep in there somewhere. But even that can become an experience with, for example, the Heavenly Bed from Westin!) So if your potential customers are spending their time experiencing other places, they can’t possibly spend that time with you.

And the best way to get their time? Once again, it’s very simple, albeit somewhat paradoxical: Charge for it. Get your customers attention so they pay money for the time they spend with you.

Great Company

By Jim Gilmore & Joe Pine

We received a barrage of e-mails from friends when Fast Company announced it was launching a new awards program, stating online that its "inaugural Customer Experience Awards will recognize and reward companies that create a rich customer experience, focus on consistently excellent customer service, and put customers first."  Folks wanted to know our reaction.