Latest / ContraMinds Podcast - Unlocking Personal Growth and Professional Excellence / B Joseph Pine II on Want to Win Customers? Sell Them Experiences (#033)

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B Joseph Pine II on Want to Win Customers? Sell Them Experiences (#033) · ContraMinds Podcast - Unlocking Personal Growth and Professional Excellence

• 0:00
  SPEAKER_00: I always say, like, you are what you charge for.
• 0:02
  SPEAKER_00: If you charge for undifferentiated stuff, you're in the commodities business.
• 0:06
  SPEAKER_00: If you charge for tangible things, you're in the goods business.
• 0:08
  SPEAKER_00: If you charge for the activities your people perform, you're in the services business.
• 0:12
  SPEAKER_00: But you're in the experience business economically if you charge for time.
• 0:15
  SPEAKER_00: Uh, time, you know, because that's what people are buying for you, is the time they spend with you.
• 0:19
  SPEAKER_00: So you think about going to a sporting event or a theme park or a nightclub or a movie or a concert or a play, you know, all of those are admission-feed experiences.
• 0:28
  SPEAKER_00: And now you increasingly see restaurants that charge admission or retail stores that charge admission, manufacturers that create experiences for which they charge admission, and so on, and and and so forth.
• 0:46
  SPEAKER_02: Hi, Joe.
• 0:47
  SPEAKER_02: Thank you very much.
• 0:48
  SPEAKER_02: And uh it's a privilege to have you as a guest in our podcast.
• 0:51
  SPEAKER_00: It's uh it's my pleasure, Swami.
• 0:53
  SPEAKER_00: It's great to be here with you and Vignesh.
• 0:55
  SPEAKER_02: Thanks, Joe.
• 0:56
  SPEAKER_02: Uh let me dive straight away into uh something that you've talked about, which uh caught our attention, which is you really wrote this book on the experience economy uh way back in 1997, I would say, and uh you actually articulated a very interesting concept where you said goods and services are just not enough.
• 1:22
  SPEAKER_02: And it's so true in 2022.
• 1:25
  SPEAKER_02: So, where did you think uh that idea came from and why do you think it's so relevant even today?
• 1:31
  SPEAKER_00: Well, well, it actually it actually came from my first book, uh, which is called Mass Customization.
• 1:38
  SPEAKER_00: And mass customization is about efficiently serving customers uniquely.
• 1:41
  SPEAKER_00: So you give everybody exactly what they want, but do it at a price they're willing to pay.
• 1:45
  SPEAKER_00: Right now, here in the US, I don't know if it's hit India yet, but um there's this big announcement from the toy company Hasbro, and and like a half a dozen people have sent it to me.
• 1:56
  SPEAKER_00: I've seen it on the news and that, where they're going to take, you know, from photographs of your face, they're going to 3D print your face and put it on a superhero uh character, you know, from Marvel Comics or from the Transformers or I don't know, Teenage Mutant Ninja Turtles, not sure all that they do, but all the all the action figures that Hasbro has.
• 2:17
  SPEAKER_00: You know, so that's an example of mass customizing, right?
• 2:20
  SPEAKER_00: My face on an action figure.
• 2:23
  SPEAKER_00: And I often had um talked about that if you look at the distinctions between goods and services, that when you mass customize your good, you actually automatically turn into a service.
• 2:34
  SPEAKER_00: That if you look at the classical distinctions, um uh goods are um, I lost the train of thought there on what the on the uh the exact nature of it for some reason.
• 2:45
  SPEAKER_00: It's it's a senior moment uh of mine.
• 2:47
  SPEAKER_00: Uh you know, but uh but I'll say goods, goods are um made in, you know, manufactured in advance, but services are delivered on demand so that uh that that you create it when the customer says this is what they want, and and uh goods are inventory after production um and uh uh but not you know but not done on demand.
• 3:11
  SPEAKER_00: And goods are goods are are tangible, but part of the the the uh mass customization is the intangible service of helping customers figure out what it is that they want.
• 3:20
  SPEAKER_00: So, you know, so when you when you when you make something done just for an individual person, you help them, they design it with them, then you make and manufacture and deliver to them, it's it's a service.
• 3:30
  SPEAKER_00: Well, one time I was asked, what happens when you mass customize a service?
• 3:35
  SPEAKER_00: And I shot back that mass customization automatically turns a service into an experience.
• 3:40
  SPEAKER_00: And I went, wow, that sounds really good.
• 3:42
  SPEAKER_00: You know, it just popped out of my mouth.
• 3:44
  SPEAKER_00: So it wasn't any analysis, it wasn't looking at all these patterns, it literally popped out of my mouth, and I said, okay, I gotta write that down.
• 3:51
  SPEAKER_00: And I began to think about it, I realized it was true, and I realized that experiences were a distinct economic offering, you know, as distinct from services as services were from goods, that experiences are when you engage people as a business in an inherently personal way and create that memory as the hallmark of the experience.
• 4:11
  SPEAKER_00: And so um uh that means that there'd be an economy based off of experiences, just like there is an agrarian economy based off commodities, an industrial economy based off goods, a service economy.
• 4:24
  SPEAKER_00: And now uh we're in an experience economy.
• 4:26
  SPEAKER_00: And when I first started talking about it in the mid to late 1990s, it was it was the nascent experience economy, the forthcoming, the emerging experience economy, and now we just say it's here.
• 4:36
  SPEAKER_00: You know, and now you can see it everywhere.
• 4:39
  SPEAKER_00: Uh it's why we we re-released the book in 2020 uh with a new preview on competing for customer time, attention, and money uh to get that notice out there that everybody needs to understand, you know, what business are you really in, and that and that you should think about being in the experiences business.
• 4:56
  SPEAKER_01: So I I think while while we do, while we have touched upon the nature of goods and services and uh experiences, I think in most of your presentations you usually kick it off with that amazing deck, uh that amazing slide on uh the progression of economic value, right?
• 5:15
  SPEAKER_01: Because I think it's super important to set that context on how we move from an agrarian sort of a society into one that values goods and services.
• 5:23
  SPEAKER_01: So can you just walk us through a little bit about that specific model and how you came up with it?
• 5:30
  SPEAKER_00: The progression of economic value is the um core framework in the experience economy, and it does talk about how economies have changed over millennia, that in the beginning were commodities, things you grow on the ground, raise in the ground, or pull out of the ground, then you sell them on the open marketplace.
• 5:46
  SPEAKER_00: And that was based at the agrarian economy uh that lasted for a millennia.
• 5:50
  SPEAKER_00: In the US, I often talk about the fact that when the US was founded in 1776, over 90% of the people worked on farms.
• 5:58
  SPEAKER_00: And today that's less than 2%, right?
• 6:01
  SPEAKER_00: In India, it's a much higher percentage still as well, but you see the same progressions over time where it used to be almost everybody and now things move.
• 6:09
  SPEAKER_00: So we we shifted into an industrial economy thanks to the industrial revolution in the late 1800s, uh, where goods became the predominant economic offering that people took commodities that they extracted out of the ground, they used them as raw materials to make goods, physical, tangible things that we touch and feel.
• 6:28
  SPEAKER_00: And then in the latter half of the 20th century, we began to shift into a service economy.
• 6:36
  SPEAKER_00: And a service economy is where services are um uh activities that you perform on behalf of an individual person, right?
• 6:44
  SPEAKER_00: In tangible uh activities.
• 6:46
  SPEAKER_00: So um uh so we've shifted where, you know, again from 90% of the people working on farms less than 2%, from at its high point, 40-some percent of people working in manufacturing jobs to less than 8%.
• 6:58
  SPEAKER_00: And now, where are all those people?
• 7:00
  SPEAKER_00: Well, most economists would say they're all in services.
• 7:03
  SPEAKER_00: And I remember early on talking to one present at one presentation, one of the guys shouted out, he said, once you get 80% of it in one category, you know, you need to split that category up, right?
• 7:13
  SPEAKER_00: And that's exactly true.
• 7:14
  SPEAKER_00: While most economists will still say experiences are part of services, they're a distinct economic offering because otherwise the category is too big.
• 7:24
  SPEAKER_00: And uh and it's also distinct because you charge differently for each one of these, right?
• 7:29
  SPEAKER_00: You know, I always say like you are what you charge for.
• 7:31
  SPEAKER_00: If you charge for undifferentiated stuff, you're in the commodities business.
• 7:35
  SPEAKER_00: If you charge for tangible things, you're in the goods business.
• 7:38
  SPEAKER_00: If you charge for the activities your people perform, you're in the services business.
• 7:41
  SPEAKER_00: But you're in the experience business economically if you charge for time.
• 7:45
  SPEAKER_00: Uh, time, you know, because that's what people are buying for is the time they spend with you.
• 7:49
  SPEAKER_00: So you think about going to a sporting event or a theme park or a nightclub or a movie or a concert or a play, you know, all of those are admission-feed experiences.
• 7:57
  SPEAKER_00: And now you increasingly see restaurants that charge admission or retail stores that charge admission, manufacturers that create experiences for which they charge admission, and so on and so forth.
• 8:07
  SPEAKER_00: So as you said, this progression we uh uh originally Vignesh we presented in the book as this sort of ladder.
• 8:15
  SPEAKER_00: People call it about the ladder where it goes up and to the right.
• 8:18
  SPEAKER_00: And the first time we we uh present it though, the first article we journal article we ever wrote on was in 1997, and it was called Beyond Goods and Services, uh Swabi, just as you you had talked about.
• 8:30
  SPEAKER_00: And um and we presented as a triangle, right?
• 8:33
  SPEAKER_00: Where you have this base of commodities and then goods, services, and experiences, and they all stand on top of each other, right?
• 8:40
  SPEAKER_00: You you're never going to get rid of commodities because they have to form the raw material for goods.
• 8:44
  SPEAKER_00: You never get rid of goods because that's what services are based on, and experiences are based on uh you know surrounding those services.
• 8:51
  SPEAKER_00: But we had a client actually, a str uh uh a strategy, um, the head of strategy at ATT who who suggested the latter formulation.
• 8:59
  SPEAKER_00: They thought it made more sense in that way, and that's what we've used ever since, and it's a great way of presenting it.
• 9:06
  SPEAKER_02: So uh one of the things, Joe, uh, which you really talk about is uh how experiences uh take a lot of inspiration from theater, right?
• 9:18
  SPEAKER_02: And uh you really talk about this whole uh you know inspiration from theater and how uh work is theater, right?
• 9:26
  SPEAKER_02: Uh so what does it take for organizations to really become an experience company, right?
• 9:34
  SPEAKER_02: So what does it take for them to transform from a service organization or a manufacturing organization to an experience organization?
• 9:43
  SPEAKER_00: Yeah, there are a number of factors that you have to do.
• 9:46
  SPEAKER_00: Now, economically, again, charging for time is the is a key one.
• 9:50
  SPEAKER_00: You need to get to that point.
• 9:52
  SPEAKER_00: But what happens in all these economic shifts is companies give away the next level of value in order to better sell what they have today.
• 9:59
  SPEAKER_00: You know, my my career, I started at IBM actually, uh, the first 13 years of my career, and I and IBM had a phrase that IBM means service, which meant we gave away whatever services you wanted as long as you bought or hardware goods.
• 10:12
  SPEAKER_00: Uh, and then eventually we realized that, hey, people value the services, and and now it's a service company that subsumes goods often into its service contracts.
• 10:22
  SPEAKER_00: So, in the same way, you have companies, restaurants, retailers, and others that give away the experience to better sell what they have.
• 10:28
  SPEAKER_00: But eventually you have to align what you charge for with what your customers value, and that means charging for that time.
• 10:34
  SPEAKER_00: So that's one key element.
• 10:36
  SPEAKER_00: A second one, uh, think about it particularly for service companies, is that at its core, services are about time well saved.
• 10:45
  unknown: Right?
• 10:45
  SPEAKER_00: Time well saved.
• 10:46
  SPEAKER_00: Most all services, I will I will say it one way.
• 10:50
  SPEAKER_00: All services are something we could do ourselves.
• 10:53
  unknown: Right?
• 10:53
  SPEAKER_00: Even if you hire a lawyer, right, and you're not a lawyer, well, you could go to law school, you could pass the bar, you could become a lawyer, and then you could do whatever contract you wanted to do, right?
• 11:03
  SPEAKER_00: Think about how much time you'd have to spend on it.
• 11:05
  SPEAKER_00: But no, this person has already done it, and so let them uh do this service for you.
• 11:11
  SPEAKER_00: Uh we all we go to so we we go out to eat at restaurants and even fast food so much more than we used to because we're allowing them to spend their time where they're very specialized and they're very good at it, and often they can do it better than I can do it.
• 11:25
  SPEAKER_00: You know, I let somebody else change the own oil, you know, change my oil in my car rather than doing it myself because they can do it better, and I don't want to get dirty and so on and so forth.
• 11:34
  SPEAKER_00: So it's you know, the history of economic progress is charging a fee for what once was free, right?
• 11:40
  SPEAKER_00: That we used to do ourselves.
• 11:43
  SPEAKER_00: Uh and and so that time well saved aspect of services, when you get into experiences, you then need to understand what people are buying is time well spent.
• 11:55
  SPEAKER_00: Right?
• 11:56
  SPEAKER_00: Time well spent, that they value the time where they spent you, that that's what they're buying from you.
• 12:01
  SPEAKER_00: Again, you get classic experiences of sporting events and plays, concerts, movies, and so forth are all things where you're saying basically, you know, entertain me.
• 12:10
  SPEAKER_00: Uh, and uh, and even in theme park where you're where you're doing much of the experience versus just being entertained uh and playing sports and going to an art gallery and and you know to a to a natural park and so on and so forth, yeah, those are really about time well spent.
• 12:27
  SPEAKER_00: So you have to make that switch.
• 12:29
  SPEAKER_00: You know, if like if you're a restaurateur and you charge for the food that you serve, make, serve, and deliver, right, then you want to make it more experienced.
• 12:38
  SPEAKER_00: Well, how do I get them to enjoy the experience?
• 12:41
  SPEAKER_00: How do we get them to view this as not just I'm serving them a meal like I would be more at a fast food restaurant, but they value the time that I am there.
• 12:49
  SPEAKER_00: And so theater is then one of the aspects, the easiest aspects to be able to do that.
• 12:54
  SPEAKER_00: Um, because when you stage experiences, work is theater.
• 12:58
  SPEAKER_00: And theater is simply being intentional about everything that you do.
• 13:04
  SPEAKER_00: And so the distinction here between services and experiences is thinking about um what versus how.
• 13:10
  SPEAKER_00: So, what are functional activities you do, but how you go about them can turn any mundane event into an engaging encounter.
• 13:18
  SPEAKER_00: My favorite example of that is a company in the U.S.
• 13:21
  SPEAKER_00: called the Geek Squad.
• 13:23
  SPEAKER_00: And the Geek Squad was founded by a friend of mine, Robert Stevens, who uh who wanted to get into installation and computer repair business.
• 13:31
  SPEAKER_00: And he said, well, who better do that than Geeks?
• 13:33
  SPEAKER_00: So he um he um um says that he doesn't interview prospective employees, he auditions them, right?
• 13:41
  SPEAKER_00: Theater, right?
• 13:42
  SPEAKER_00: Make sure he can typecast them as geeks.
• 13:44
  SPEAKER_00: Um he then uh costumes them in white shirts, uh little black ties.
• 13:49
  SPEAKER_00: The ties are clip-on, just in case there's an altercation, he says.
• 13:52
  SPEAKER_00: Uh, and uh with black pants and white socks, black shoes.
• 13:56
  SPEAKER_00: The white socks really make that uniform pop.
• 13:58
  SPEAKER_00: Uh they drive around in these geek mobiles, black and white beetles look like squad cars.
• 14:03
  SPEAKER_00: Uh, and then when they get to your home or to your office, the first thing they say is, Hi, I'm from the Geek Squad.
• 14:09
  SPEAKER_00: Right?
• 14:09
  SPEAKER_00: Slowly step away from that computer, sir, and they go about giving you a computer repair experience with their special agent geek squad badge.
• 14:17
  SPEAKER_00: And Roberts wants the computer repair experience to be so engaging that the customers can't wait till their computers break down.
• 14:25
  SPEAKER_00: Right.
• 14:25
  SPEAKER_00: So, you know, other than showing the badge, everything, everything he does is is around the how, not the what.
• 14:33
  SPEAKER_00: He's doing, you know, all the Geek Squad agents, they do the same things as every other service company does.
• 14:38
  SPEAKER_00: But how they go about doing it uh can turn it again into uh into an engaging encounter and and turn it into an experience.
• 14:47
  SPEAKER_00: So that's the uh that's the number one thing to think about as you shift from services to experiences, what is your your the theater that you create?
• 14:56
  SPEAKER_00: All right, well, I think one of the things that occurs to me also is that with theaters, it's not just about what people do, but it's the design of the time that people spend, right?
• 15:04
  SPEAKER_00: You need dramatic structure, you need to rise up to a climax and come back down again.
• 15:08
  SPEAKER_00: If you have a very flat experience where nothing much happens and everything is just sort of boring as you're going along, right?
• 15:14
  SPEAKER_00: Well, then people are going to disengage.
• 15:16
  SPEAKER_00: Um, but if you create a great experience and you you bring it up to that climax and come it down again, then that's the other key aspect of theater.
• 15:24
  SPEAKER_01: I I just have this huge smile on my face because all this talk about theater and time and everything, it really reminded me of this old Hitchcock quote that I read from somewhere that I don't remember, but there's this quote that Hitchcock gave, which is a good film is when the price of dinner, the theater admission, and the babysitter were worth it.
• 15:43
  SPEAKER_01: Right, right, exactly.
• 15:45
  SPEAKER_01: Yeah.
• 15:46
  SPEAKER_01: Uh so coming back on track, I think you were talking about uh ideas around the experience economy around 13 to 15 years ago, and this is pre-big data, this is pre-machine learning, and and it's it's that kind of a world for folks to even imagine what that world was like so 15 years ago.
• 16:04
  SPEAKER_01: So, can you talk to us a little bit about what was the feedback or even some pushback that you might have received for the idea of bringing forth this notion of an experience economy?
• 16:15
  SPEAKER_00: Yeah, that's a great question.
• 16:17
  SPEAKER_00: It's funny because I you know like I did used to get pushback.
• 16:20
  SPEAKER_00: I almost never get pushback anymore.
• 16:22
  SPEAKER_00: Now I just say it and people go, yeah, I get it.
• 16:25
  SPEAKER_00: You know, they because they recognize it in their own lives.
• 16:28
  SPEAKER_00: But when we first started talking about the late 90s, early 2000s, uh there was there was a lot of pushback just from people who who like philosophically didn't like the idea, um that also were concerned about the jobs that were already being lost in manufacturing in particular, but they were lost long before that in commodity business and uh in some cases now in services businesses as they commoditize.
• 16:57
  SPEAKER_00: And they and so one of the things they often did just to get them to understand that that that you know that economic change is inevitable, is uh is I'd I'd ask them, um, how many people here have ever killed a chicken for dinner?
• 17:14
  SPEAKER_00: And uh and uh you know, and and like you'd have three or four hands raised in a group of 50 people or something, and the other people would turn around and look at these people like they were from Mars because they just could never imagine having to kill a chicken themselves for dinner.
• 17:31
  SPEAKER_00: And I and I said, I said, you go back a hundred years, guess what?
• 17:36
  SPEAKER_00: Half the country killed chickens for dinner.
• 17:38
  SPEAKER_00: Purdue farms didn't exist.
• 17:40
  SPEAKER_00: You know, this is what you did.
• 17:42
  SPEAKER_00: Uh, and and then just to realize that.
• 17:44
  SPEAKER_00: And I and then I asked the service guy, so how many people still change their own oil in their cars?
• 17:49
  SPEAKER_00: And always fewer people change their own oil in their cars than people had killed a chicken for dinner.
• 17:56
  SPEAKER_00: And I said, because that's a that's a service that you want.
• 17:59
  SPEAKER_00: So so again, it's a matter of paying people um for what we used to do ourselves.
• 18:04
  SPEAKER_00: I said we all used to be responsible for our own services, for own experiences, excuse me.
• 18:09
  SPEAKER_00: I remember when I grew up, uh the big weekly family experience was Sunday dinner.
• 18:14
  SPEAKER_00: That Sunday dinner was different than every other night.
• 18:17
  SPEAKER_00: It was in the late, it was in the mid-late afternoon, not in the evening.
• 18:20
  SPEAKER_00: It was everybody was expected to be there, it was much bigger because you sort of skipped lunch and you didn't have dinner, and and you sort of talked about your week and everything.
• 18:29
  SPEAKER_00: And I, you know, I had a good friend I remember that uh that I would invite over for Sunday dinner on occasion and he would have a great time and uh because he was uh you know, he didn't have any family in the area.
• 18:39
  SPEAKER_00: So it uh you know, it's just it was an experience that we had.
• 18:43
  SPEAKER_00: Another one is birthday parties, you right?
• 18:45
  SPEAKER_00: When I grew up, moms would invariably throw the birthday party experience uh with handmade games like Pin the Tail on the Donkey and things like this.
• 18:56
  SPEAKER_00: Uh and uh then over time, by the 1990s, 2000s, you know, most moms, not everybody, but most moms would go someplace else and have them throw the experience for their kids and their friends, you know, whether it's Chuck E.
• 19:08
  SPEAKER_00: Cheeses or McDonald's Playland or a museum or some other uh bowling alley, some other place out there, movie theater too.
• 19:16
  SPEAKER_00: And uh so that's just how it's how the how the economy changes.
• 19:20
  SPEAKER_00: So again, I I I rarely get that uh that sort of objection anymore because you you you can't you you can't object because you can see it all around you.
• 19:28
  SPEAKER_00: It's in the air that we breathe today.
• 19:30
  SPEAKER_00: Uh this this notion that how much we prefer experiences over things.
• 19:34
  SPEAKER_02: Uh so Joe, one of the uh points that I wanted to talk to you about is this when you want to build this experience ecosystem in a company, uh you have manufacturing, you have sales, you have a channel, you've got marketing, you've got supply chain.
• 19:52
  SPEAKER_02: And one of the things is if you really want to intertwine this experience across all these departments, uh it's one hell of a challenge, right?
• 20:01
  SPEAKER_02: Because if I imagine I'm an insurance company, if I want to move to becoming an experience, uh, you know, what you call the ink company, right?
• 20:11
  SPEAKER_02: Uh what you keep talking about, right?
• 20:13
  SPEAKER_02: Uh it's one hell of an experience because the channel uh is not something that I own, but how do I really transfer that experience uh for a distributor of uh insurance?
• 20:26
  SPEAKER_02: And that is a real challenge.
• 20:28
  SPEAKER_02: And even today, if I'm an employee of a company, okay, uh, unless until I am the actor in the theater, uh, you know, I just uh you know I just perform a function, right?
• 20:39
  SPEAKER_02: So therefore, if we have to transform, the way even we are remunerated is actually based on the industrial world models, right?
• 20:50
  SPEAKER_02: So I would think that if you really want to do this, a whole host of other changes needed needs to be done across departments.
• 20:57
  SPEAKER_02: So is that something that you see and what are the real challenges and bottlenecks for doing this?
• 21:03
  SPEAKER_00: Yeah, yeah, that's that's uh very insightful uh Swami, that you do have to make all these changes.
• 21:08
  SPEAKER_00: And and it comes down to um the core of deciding what business are you really in.
• 21:15
  SPEAKER_00: And so management has to understand that, okay, we're in the experience business.
• 21:19
  SPEAKER_00: Maybe it's not the whole business, maybe it's a part of the business, maybe uh it's something you want to do on top of our services, and so we need special people to be able to do it.
• 21:28
  SPEAKER_00: But um uh you need to sort of make that decision that we're going to be in the experience business, and then let that start to flow down and determine everything that you do.
• 21:39
  SPEAKER_00: Uh the theater, particularly for customer facing uh employees, is one of the most important things to be able to do that.
• 21:46
  SPEAKER_00: Uh, but there's many other things in the um re release of the book in 2020.
• 21:52
  SPEAKER_00: We position sort of everything as creating uh what we call robust, cohesive, personal, dramatic.
• 22:00
  SPEAKER_00: And even transformative experiences.
• 22:02
  SPEAKER_00: And those are the things that you want to focus on, is those five elements of experience.
• 22:08
  SPEAKER_00: What many companies do in that situation, and I do highly recommend it, although it may not be for a forever thing, is to appoint a chief experience officer, right?
• 22:19
  SPEAKER_00: CXO, chief experience officer, to really head the movement in that direction.
• 22:26
  SPEAKER_00: There's now thousands of CXOs around the world.
• 22:31
  SPEAKER_00: And a lot of them are really focused on that internal transformation.
• 22:35
  SPEAKER_00: I always think of as both an internal and an external facing transformation that you need to work on designing the experience, including those robust, cohesive, personal, dramatic, and transformative experiences.
• 22:47
  SPEAKER_00: How do you design those experiences?
• 22:49
  SPEAKER_00: You need to be the catalyst for change internally in the organization.
• 22:55
  SPEAKER_00: And that you're holding up the North Star of what experiences are all about.
• 22:59
  SPEAKER_00: You need to orchestrate all the capabilities together to be able to create those experience office offerings.
• 23:05
  SPEAKER_00: And then you need to champion the customer, or ideally, when you're talking experiences, the guest of the experience in the organization, as well as champion the organization to customers and the capabilities to customers.
• 23:20
  SPEAKER_00: And then find those are the key four roles of chief experience officers.
• 23:25
  SPEAKER_00: And then finally, the last one is guide, because it is a transformational role that you need to guide the internal transformation it takes to shift from service provider to experience stager.
• 23:40
  SPEAKER_01: This is a very straightforward question, but it's also one that caught my attention, which is Joe, why do you call Las Vegas the experience capital of the world?
• 23:52
  SPEAKER_00: It is a straightforward question.
• 23:53
  SPEAKER_00: Have you ever been there?
• 23:55
  SPEAKER_00: Everything about Vegas is about the experience.
• 24:35
  SPEAKER_00: So they created these shows and they created these restaurants and they they you know Cirque du Soleil, in particular, one of the most fabulous experiences in the world.
• 24:57
  SPEAKER_00: And you could sort of see that their revenues, you know, the gambling was going like this, but all this other stuff was going like this.
• 25:02
  SPEAKER_00: And it was, and it was, it was like 2007, you know, when they passed.
• 25:06
  SPEAKER_00: Now the profits of gaming is still higher, but that's going to shift as well because they realized first it was sort of like, we're going to give away this stuff so they come and game.
• 25:14
  SPEAKER_00: All we care about is the gambling revenues.
• 25:17
  SPEAKER_00: Uh and then they realized, no, we can make a lot of money in this stuff as well.
• 25:21
  SPEAKER_00: So just everything you go there is about an experience.
• 25:23
  SPEAKER_00: And it's also reason experience capital of the world, um, is that is that everything you experience there is eventually coming to your town.
• 25:32
  SPEAKER_00: You know, in the in the in the US, most every state now has has gambling.
• 25:38
  SPEAKER_00: You know, often it's via via American Indian reservations and so forth, with different rules that they can do, but governments are trying to make money off of it as well, and so they're they're uh opening up that gambling.
• 25:51
  SPEAKER_00: You see the Cirque du Soleil appearing in other places as well.
• 25:54
  SPEAKER_00: And uh, one of my favorite examples of that is this um this device I love that's called the Gumball Wizard.
• 26:04
  SPEAKER_00: The gumball wizard is from a global gumball, and it's a gumball machine.
• 26:09
  SPEAKER_00: Um, but what happens is you is the kid gets a quarter and he comes up to the gumball machine and he doesn't get a gumball, at least not right away.
• 26:17
  SPEAKER_00: Instead, he gets this gumball spiraling experience.
• 26:20
  SPEAKER_00: The gumball doesn't just go down and deposit, it goes spiraling down, clickety clack as it goes.
• 26:26
  SPEAKER_00: And there's no functional purpose whatsoever for this device, right?
• 26:30
  SPEAKER_00: It is totally for uh adding a layer of experience on this this good.
• 26:34
  SPEAKER_00: And it's and you could say actually it's worse service.
• 26:37
  SPEAKER_00: It's worse service.
• 26:38
  SPEAKER_00: Why?
• 26:38
  SPEAKER_00: Because it takes longer to get the physical good, the gumball, that you requested.
• 26:42
  SPEAKER_00: And so you've got this manufactured good that's the same, you got worse service, but you add an experience on top of that, and then and then the value of the gumball goes up and they can charge more more for it.
• 26:54
  SPEAKER_00: Right?
• 26:54
  SPEAKER_00: Well, and if you and I I remember seeing kids go up to their parents, ask them for a quarter, come up to the gumball wizard slot, excitedly turn that crank, have the gumball spiraling experience, pick up the gumball, throw it away, and go ask their parents for another quarter.
• 27:09
  SPEAKER_00: So it's really just a slot machine for kids, right?
• 27:11
  SPEAKER_00: So that's what I mean, right?
• 27:13
  SPEAKER_00: Las Vegas is coming to your town.
• 27:15
  SPEAKER_02: Uh so Joe, uh, I'm coming back to uh this uh if uh you know we're moving to uh experience economy from a service economy and 80% uh really becomes an experience economy.
• 27:30
  SPEAKER_02: Uh can you give us some examples of companies where the appraise appraisals, the bonuses, the remuneration, the mindsets, the skills needed, right, uh are uh of experience agents, right?
• 27:44
  SPEAKER_02: I am a software coder, I need to be an experience agent, right?
• 27:48
  SPEAKER_02: I am an insurance uh you know marketing guy, I need to be an experience agent.
• 27:53
  SPEAKER_02: And there's a certain amount of passion and purpose that's required.
• 27:57
  SPEAKER_02: If you really want to be an experience agent, you just can't perform a function.
• 28:01
  SPEAKER_02: I'm coming back to that question, and I find that to be the biggest gap between wanting to be an experienced company and actually becoming an experienced company, and what does it take to bridge this gap?
• 28:14
  SPEAKER_00: Right.
• 28:14
  SPEAKER_00: That is that is a great question, and I and I and I can't think of any companies that really fit the bill in terms of shifting from service to experiences that have made that leap in that in that way that you're talking about, although I sure I'm sure there are.
• 28:30
  SPEAKER_00: But the but what the one very related thing is where you need to therefore not just shift to, you need to stop doing things that were the old ways of doing things.
• 28:40
  SPEAKER_00: So there the key example occurs to me is uh is Zappos, uh the shoe company founded by the late Tony Shea that Amazon bought a number of years ago for a billion dollars.
• 28:50
  SPEAKER_00: Now, they sell shoes online, but what they're famous for is their contact center.
• 28:55
  SPEAKER_00: And their contact centers are experience agents.
• 28:58
  SPEAKER_00: I don't think they use that exact term, but that's exactly what they are.
• 29:00
  SPEAKER_00: They're not contact center reps, they are experience agents.
• 29:05
  SPEAKER_00: They tell them to create a personal, emotional connection with every customer that calls in because they want that experience there.
• 29:12
  SPEAKER_00: They want them to remember the interaction so that the chances they come back and buy go up, the chances that they tell others go up, because they recognize it's not a one-period model.
• 29:22
  SPEAKER_00: It's just about this individual call, it's about the entire lifelong relationship we have with the customer.
• 29:26
  SPEAKER_00: So the key thing they did is that they stopped measuring average handling time.
• 29:32
  SPEAKER_00: Right?
• 29:32
  SPEAKER_00: Average handling time, standard contact measure for how long does it take for this customer and for us to get rid of them, right?
• 29:39
  SPEAKER_00: And that's the attitude, right?
• 29:40
  SPEAKER_00: Is how long does it take for us to get rid of them?
• 29:42
  SPEAKER_00: Get them off the phone.
• 29:43
  SPEAKER_00: Because why?
• 29:44
  SPEAKER_00: Because they're costing us money, not recognizing, no, this is a personal time that you have with a living, breathing customer.
• 29:51
  SPEAKER_00: You should make value it, you should make it time well spent.
• 29:54
  SPEAKER_00: And that's exactly what Zappos does.
• 29:57
  SPEAKER_00: In fact, for a long time, they uh uh celebrated every day the the customer service rep, the experienced agent, as you so uh rightly call it, who got to spend the most time with a customer that day.
• 30:11
  SPEAKER_00: And their record is 10 hours and 43 minutes, right?
• 30:14
  SPEAKER_00: If you can imagine that.
• 30:16
  SPEAKER_00: One rep, one customer, and that customer, you're sure, is a customer for life, you know, and then and then it's gonna bring other customers uh into them.
• 30:24
  SPEAKER_00: So do think about what you stop doing and what you need to start doing as you as you uh make that shift.
• 30:31
  SPEAKER_01: So culturally speaking, standards of great experiences vary from culture to culture.
• 30:38
  SPEAKER_01: Uh so when you take a company like Apple, which has been instrumental in exporting great design and great user experiences to its millions of users across millions of devices uh all over the globe, uh, where customers have different expectations on what great experiences are.
• 30:58
  SPEAKER_01: How do you think a company like Apple is able to determine what is an extraordinary standard of experience for that scale of customers using its products?
• 31:08
  SPEAKER_01: Or Amazon for that matter?
• 31:10
  SPEAKER_00: Right.
• 31:10
  SPEAKER_00: Well, you know, so well, Amazon's interesting too, because I mean Apple is at its heart a manufacturer, Amazon at its heart is a service provider, and um and Apple uh specifically got into thinking about experiences um first with what basically the design of their products, right?
• 31:30
  SPEAKER_00: That they wanted to make the using of the product into an experience.
• 31:34
  SPEAKER_00: Well, I mean you referred, uh alluded to earlier our our our phrase, in the thing, right?
• 31:39
  SPEAKER_00: That we want uh uh manufacturers to ing the thing, which means focus on the using, right?
• 31:45
  SPEAKER_00: If you use ing words, it means you're experiencing.
• 31:48
  SPEAKER_00: I'm I'm drinking you know uh coffee from from a cup, I'm um I'm uh typing on my keyboard, means you're doing things that are experiential.
• 31:59
  SPEAKER_00: Um the um uh so Apple really is excels at that, the best in the world, but then they decide to get fully into the experience business with with the Apple stores.
• 32:10
  SPEAKER_00: And I remember when Steve Jobs uh first announced that they were going to get into retail, he really got lambasted in the business press.
• 32:18
  SPEAKER_00: I said, you know, like what do you think you're doing?
• 32:20
  SPEAKER_00: You're you're you're competing with your channel partners, you're gonna tick them off.
• 32:23
  SPEAKER_00: You don't know anything about retail, you're gonna fail miserably.
• 32:26
  SPEAKER_00: This was even this was before the iPhone was was invented.
• 32:29
  SPEAKER_00: So they're selling iPods and Macs and everything.
• 32:32
  SPEAKER_00: And he proved them wrong by creating not just a uh app uh retail store, but a retail experience and designed it experience, prototyped his experience.
• 32:42
  SPEAKER_00: They they went and examined many many five-star hotels, for example, is where they took their lead from, like Ritz Carlton's, to be able to think about the experience that people have when they look at it, when they come into it, what the interactions are that they have.
• 32:55
  SPEAKER_00: So they went from that, they took that same level of beautiful design that they do and applied it to a retail experience as they do to a uh physical as the physical goods.
• 33:08
  SPEAKER_00: Um Amazon, I think of still as primarily a service provider.
• 33:13
  SPEAKER_00: They they've gotten into the experience business with Amazon Explore, where you can um um actually like Airbnb experiences, you can buy experiences from Amazon that you do virtually or physically.
• 33:26
  SPEAKER_00: They also have Amazon Live, which is sort of like the home shopping network, you know, on the on the Amazon site where people are selling wares and that, and that you can have a personal uh interaction uh with them.
• 33:37
  SPEAKER_00: But but where it really excels is it's it's time well saved on steroids.
• 33:42
  SPEAKER_00: You know, it's just like one click, boom, I got that.
• 33:44
  SPEAKER_00: I don't think about it, it comes to my door, transaction done.
• 33:48
  SPEAKER_00: Uh and uh and it's beautiful in that regard.
• 33:51
  SPEAKER_00: But they but even they recognize that there's a little shift to the to experiences that they need to do.
• 34:03
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• 34:11
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• 34:15
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• 34:26
  SPEAKER_01: And now back to the show.
• 34:29
  SPEAKER_02: Uh just uh doing uh uh you know uh slight shift from experiences.
• 34:35
  SPEAKER_02: In your book, uh, you know, look you talk about uh you know six looking glasses.
• 34:41
  SPEAKER_02: I thought it was a very interesting concept.
• 34:43
  SPEAKER_02: Uh can you talk to us about six looking glasses?
• 34:47
  SPEAKER_00: No, because I didn't write that book.
• 34:51
  SPEAKER_00: My partner Jim Gilmore did.
• 34:53
  SPEAKER_00: But uh so you'd really you really have to ask him.
• 34:58
  SPEAKER_00: Um, you know, I've I uh I would do a poor job of explaining it.
• 35:03
  SPEAKER_00: But the basic, you know, the the basic idea is that is is a book about observation, that if you want to innovate, first you need to observe.
• 35:11
  SPEAKER_00: You know, you look at uh what do customers want, and it is a great way of thinking about how you um um observe uh what's going on in you know, in this case, in the world of business, through through those glasses that give you each one of them give you a different perspective on on any particular situation.
• 35:29
  SPEAKER_00: Brilliant, brilliant.
• 35:30
  SPEAKER_01: So I I could you talk to us a little bit about uh Lionel Trilling and his book Sincerity and Authenticity, and uh what impact did that book uh have on your work?
• 35:43
  SPEAKER_01: And if I may be so indulgent, how it made you relook at things, if possible, at a personal level.
• 35:52
  SPEAKER_00: Yeah, so that's interesting.
• 35:54
  SPEAKER_00: So shortly after the Experience Academy came out, um it was you know, it was like within two or three years, we began noticing that how much when you talk about experience, how much people bring up authenticity.
• 36:08
  SPEAKER_00: You know, for me, I became a visiting professor at the University of Amsterdam, and I spent a lot of time in the Netherlands, and and it seemed like every session I did, you know, that the first question uh would start with the same two words.
• 36:23
  SPEAKER_00: It was always you Americans, and it was more of an accusation than a question.
• 36:27
  SPEAKER_00: They'd say, you Americans, you like your fantasy experiences, your fake experiences, your Disney experiences.
• 36:35
  SPEAKER_00: You know, we Dutch, we like real authentic experiences.
• 36:39
  SPEAKER_00: And this happened so much, I eventually developed a practice response to it, where I said, well, first understand that all experiences are authentic to you, right?
• 36:49
  SPEAKER_00: As long as you're an authentic human being in some way, if you view them as authentic, they're authentic uh to you.
• 36:55
  SPEAKER_00: Uh and uh and so in that sense, there's no such thing as a as a fake experience.
• 37:01
  SPEAKER_00: Um, but also that this is this is uh, I always say this is an amazing question coming from a country like the Netherlands, which is just as manufactured as Disneyland is.
• 37:14
  SPEAKER_00: And they sort of go like this, and then they go, and they realize I'm right, right?
• 37:17
  SPEAKER_00: Because, you know, half of the country's been reclaimed from the sea.
• 37:21
  SPEAKER_00: It wasn't actually any land at all.
• 37:23
  SPEAKER_00: It was water.
• 37:24
  SPEAKER_00: They there isn't uh seem like a square meter in the entire place that hasn't moved, been moved, modified, or manicured to look as if it's always been there.
• 37:32
  SPEAKER_00: It's the only place where I've ever gone for a walk in the woods and all the trees are lined up in rows, right?
• 37:37
  SPEAKER_00: That's that's authentic to them, right?
• 37:40
  SPEAKER_00: So uh so but but we realized then that it um uh it really is an issue.
• 37:46
  SPEAKER_00: And and eventually what we realized is that authenticity was what we call the new consumer sensibility of the experience economy.
• 37:54
  SPEAKER_00: That that, in other words, it was the primary buying criterion by which people choose what to buy and who to buy from.
• 38:00
  SPEAKER_00: And increasingly they didn't want the fake from the phony, they wanted the real from the genuine.
• 38:05
  SPEAKER_00: So to uh to really understand that, and that was the the second book that Jim Gilmore and I wrote together, came out in 2007, um, you know, that I always like to say that we had we read all of these philosophy books on authenticity, so you don't have to, right?
• 38:20
  SPEAKER_00: So we read Lionel Trilling, Sincerity, Authenticity, we read Charles uh Taylor, we read Jean-Jacques uh Rousseau, and and uh we read Heidegger.
• 38:30
  SPEAKER_00: Well, nobody can read Heidegger, but we we we read it as well as we could to synthesize what they were doing.
• 38:38
  SPEAKER_00: And uh Trilling had one particular impact, if I remember it right, which is that uh he was the one who pointed to um Shakespeare's play Hamlet, which was perhaps the most existential of all plays, you know, to be or not to be.
• 38:57
  SPEAKER_00: Uh, and there's this uh there's this, if I remember right, act two, scene three, uh, but there's this point at which um um Laertus is going off to France, and his father Polonius is giving him his long series of advice as they're starting the trip.
• 39:14
  SPEAKER_00: And uh, you know, it's filled with platitude after platitude and cliche after cliche until the very end, Polonius, or rather Shakespeare through Polonius, says something very profound, which is this above all, to thine own self be true.
• 39:27
  SPEAKER_00: And it must follow as night to day.
• 39:29
  SPEAKER_00: Thou canst not then be false to any man.
• 39:32
  SPEAKER_00: And uh and we realize was that those two, those three lines of the immortal barb contain the two key standards of authenticity.
• 39:41
  SPEAKER_00: The number one, it's about being true to self, right?
• 39:44
  SPEAKER_00: That's how we know uh we know we're being inauthentic when we're not being true to self.
• 39:50
  SPEAKER_00: Uh, when we do things that are antithetical to who we are, that applies not just to people, but to corporations.
• 39:55
  SPEAKER_00: When corporations do things that that betray their heritage or their principles, their values, their meaningful purpose and so forth, they're not being true to self.
• 40:04
  SPEAKER_00: Uh, and then that last line about not being false to any man is not about the self to which you must be true.
• 40:10
  SPEAKER_00: It's about how you represent that self in truth, represent that self to others, right?
• 40:16
  SPEAKER_00: So true to self is self-focus.
• 40:19
  SPEAKER_00: Um, and this is is other focus where it's a matter of are you what you say you are, right?
• 40:24
  SPEAKER_00: Is your offering what it says it is?
• 40:26
  SPEAKER_00: Is your company what it says it is?
• 40:29
  SPEAKER_00: And so those are the two key standards of what we call the real fake matrix uh um uh in the book.
• 40:35
  SPEAKER_00: And uh and so those axes were inspired by thinking about that in in in Lyle Trilling, where you talk about that difference between sincerity and authenticity.
• 40:45
  SPEAKER_02: Uh so Joe, uh how do you see the correlation between authenticity and experience?
• 40:52
  SPEAKER_02: Is there a strong correlation to great experiences having great authenticity?
• 40:58
  SPEAKER_02: Do you see that as extremely correlated?
• 41:00
  SPEAKER_00: It is there is a correlation, but it's not extreme.
• 41:04
  SPEAKER_00: Right?
• 41:05
  SPEAKER_00: We can all have experiences that that we know are fake.
• 41:09
  SPEAKER_00: In fact, you know, the real fake matrix, what it says is is that you can be real, real, fake, fake, real, fake, or fake real.
• 41:16
  SPEAKER_00: And uh, and and you can be perceived as authentic in any one of those, right?
• 41:20
  SPEAKER_00: Because again, it's it's all about perception.
• 41:22
  SPEAKER_00: Uh, and so, for example, many of the best experiences aren't in the real real, they're in the fake real.
• 41:30
  SPEAKER_00: Right?
• 41:30
  SPEAKER_00: Where is what does that mean?
• 41:31
  SPEAKER_00: Where it's where you create a fake reality.
• 41:34
  SPEAKER_00: So Disney theme parks, for example, are fake realities.
• 41:38
  SPEAKER_00: They are they're not what they say they are.
• 41:40
  SPEAKER_00: That's not really Cinderella's castle.
• 41:42
  SPEAKER_00: Right, Mickey Mouse doesn't really exist.
• 41:44
  SPEAKER_00: If if they sprinkle pixie dust on you, you're not really gonna fly.
• 41:48
  SPEAKER_00: But they're wonderfully and marvelously true to themselves, right?
• 41:51
  SPEAKER_00: So that's where they maintain things.
• 41:52
  SPEAKER_00: They're true to self.
• 41:54
  SPEAKER_00: They manicure everything to give you a particular impression.
• 41:57
  SPEAKER_00: They're intentional about everything, and they stay true to self about what they're trying to accomplish in those theme parks.
• 42:03
  SPEAKER_00: So they create a real a fake reality.
• 42:05
  SPEAKER_00: Same thing with most places, right?
• 42:08
  SPEAKER_00: You create a Harry Potter store to celebrate the Harry Potter uh movies, while you create a fake reality.
• 42:15
  SPEAKER_00: Um even you would say something like Italy, which is I think the most vibrant retail experiences in the world, retail stores.
• 42:24
  SPEAKER_00: You're familiar with them, Ignesh, I see.
• 42:27
  SPEAKER_00: Um, you know, that they're they're creating a little piece of Italy outside of Italy, right?
• 42:31
  SPEAKER_00: So in that sense, they're not uh you know truly what they say they are either, but but they're having fun with it because they say Italy E-A-T, right, Eat Ali, right?
• 42:41
  SPEAKER_00: Great, one of the best names uh uh in the world.
• 42:44
  SPEAKER_00: So um so you can have wonderful experiences that are that are really in uh in each one of those, uh depending on on what it is uh and and what you know what you're looking for.
• 42:56
  SPEAKER_01: So should we take one question before going into the rapid fire?
• 42:59
  SPEAKER_01: Okay.
• 42:59
  SPEAKER_01: So I think we've we've a lot of these experience-based innovations that we are seeing has been uh truly are large uh implementation we've seen in the world of bits and not a lot in the world of atoms.
• 43:16
  SPEAKER_01: And I make that distinction because it's a lot easier to build stuff on the web than in uh than in reality, so to speak.
• 43:25
  SPEAKER_01: One of the reasons I'm asking this question is because uh there are several industries where people have put experience at the heart of the value proposition of that organization, like say EVs, electric vehicles, fintech, and co-working spaces.
• 43:40
  SPEAKER_01: But there are those I but I also want to know what is your take on what will be the power of applying experiences to the unsexy but radically important parts of society, like say nuclear energy.
• 43:54
  SPEAKER_01: We are in a climate crisis, so what will happen if we say what if what will happen if we put the vision?
• 44:00
  SPEAKER_01: Of experience and nuclear or healthcare or public policy for that matter.
• 44:04
  SPEAKER_01: So, what are your thoughts on applying the experience framework at these really pivotal industries so that we can truly progress as a society?
• 44:14
  SPEAKER_00: Yeah, that's that's a wonderful insight.
• 44:17
  SPEAKER_00: That that I mean it can be applied anywhere.
• 44:20
  SPEAKER_00: I it always say not every company has to shift up to staging experiences, but all companies would benefit from.
• 44:27
  SPEAKER_00: One of the ways, uh, and one of the ways a lot of companies start is sort of an add-on to what they're doing, is to create what I call marketing experiences.
• 44:36
  SPEAKER_00: And that experiences that do the job marketing, the generating demand for your core offering.
• 44:41
  SPEAKER_00: So it needs to be physical, it needs to be digital experience.
• 44:44
  SPEAKER_00: That's why you see so many manufacturers create flagship experiences like the Guinness Storehouse in Dublin, the Heineken experience in Amsterdam, the World of Coca-Cola in Atlanta, and so on and so forth.
• 44:55
  SPEAKER_00: Uh that are there to generate demand.
• 44:57
  SPEAKER_00: And there's many different ways that you could do that.
• 45:00
  SPEAKER_00: And you can do it virtually by going on Roblox and having a concert and so forth, by creating your own virtual worlds.
• 45:08
  SPEAKER_00: Um so that's what I so even a utility, even an energy company could think about how they they go about uh doing that.
• 45:19
  SPEAKER_00: Um the um um the the other thing is is then applying it to things like healthcare and others are particularly important.
• 45:30
  SPEAKER_00: In fact, I probably have worked more in the healthcare industry with hospitals in particular, because research has shown that the better the patient experience, the better the outcome, right?
• 45:42
  SPEAKER_00: And that's the key with healthcare.
• 45:44
  SPEAKER_00: And I think it'd apply in financial services and other industries as well in education, that the better the experience, the more you're gonna learn, right?
• 45:51
  SPEAKER_00: That the better the experience, the more you're gonna save and invest and so forth and do it well.
• 45:56
  SPEAKER_00: So I think there's a lot of industries where that's the case and where you need to really, really think about the experience.
• 46:02
  SPEAKER_00: It really you a lot of companies recognize it, but not everyone, it really is a core element of healthcare is the experience that patients have, the treating them as a whole person rather than a collection of symptoms.
• 46:14
  SPEAKER_00: Um research also shows that uh if doctors, you know, back to acting, if doctors have poor bedside matter, as we say, and don't act very well, well, people don't always understand the instructions.
• 46:27
  SPEAKER_00: They don't always get it, they don't know what it is, and they'll follow their um uh instructions much better if the doctor acts in a way that that it engages them and allows them to understand them and so forth.
• 46:42
  SPEAKER_02: Uh a top-up question on uh what Vignesh just asked uh uh what do you think about application of the experience principle in industrial products where decision making is extremely rational, right?
• 46:55
  SPEAKER_02: Say I'm selling bearings, air compressors, which is the real uh you know, boring products if I were to call.
• 47:03
  SPEAKER_02: Uh is there a way to envelop experience in these kind of industrial products?
• 47:10
  SPEAKER_00: Yeah, it's it's I've written articles on that and work with industrial companies.
• 47:15
  SPEAKER_00: Um and and and so I'll I'll I'll uh change a little something that you said, Swami, which is people think that all decisions are rational.
• 47:26
  SPEAKER_00: One of the things that science shows is that most all decisions are irrational, are emotional, even even the ones we you know are really trying to be rational.
• 47:34
  SPEAKER_00: Um and so so if you can create an emotional connection, you're still going to try to uh you still get a a preference, right, so to speak, right?
• 47:47
  SPEAKER_00: If you're not completely out of the out of the ballpark.
• 47:49
  SPEAKER_00: And you know, good salespeople have always known that, right?
• 47:52
  SPEAKER_00: Where they take clients out to dinner, or they take them out golfing, they take them to a uh golf tournament or something.
• 47:58
  SPEAKER_00: And so, so, like I talked about those flagship marketing experiences for um uh Guinness and Heineken and Coca-Cola and et cetera, uh, you see the same thing happening in B2B.
• 48:10
  SPEAKER_00: You know, the the one I like best is the um Case Tomahawk uh uh experience center in the Northwoods of Wisconsin in the U.S., where Case Construction Company basically put in a lodge and they put in a giant sandbox and they bring clients up to actually play with the equipment.
• 48:30
  SPEAKER_00: A lot of them grew up using the equipment, but now they're the heads of their companies, they don't get to the chance anymore and say, well, here, try out the latest stuff, do all this, they have rodeos and contests about who can move the most amount of dirt in the shortest amount of time.
• 48:43
  SPEAKER_00: And they did a study once that said that a normal customer goes up to a dealer of theirs, they have perhaps a 20% chance of getting the business, but they bring them up to the Tomahawk Experience Center and goes up to 80%.
• 48:55
  SPEAKER_00: And from 20% to 80% because the experience is the marketing.
• 48:59
  SPEAKER_00: Again, the best way to generate demand for any um offering, whether it's commodity, goods, service, or another experience, is with an experience so engaging the customers can't help but spend their time with you, give you their attention, and then buy up as a result.
• 49:12
  SPEAKER_00: So again, I know of scores, so I'm sure there are hundreds and maybe thousands of these sort of experienced centers around the world that B2B companies are using as well.
• 49:22
  SPEAKER_00: And then also there are some and and and many that would benefit by understanding theater, understanding the relationship that we have.
• 49:30
  SPEAKER_00: Another aspect that applies to B2B and um as well as consumer fields is the first thing that we that we talked about, which is where did the experience economy come from?
• 49:41
  SPEAKER_00: And it came from mass customization, right?
• 49:43
  SPEAKER_00: So I realized that mass customization turns a good into a service and a service into an experience.
• 49:49
  SPEAKER_00: So one of the things to do as a B2B manufacturer is mass customize your goods and then mass customize your services on top of those, right?
• 49:56
  SPEAKER_00: Use that customization to form individual relationships with your customers that grow and deepen over time and uh give you a preference for them.
• 50:05
  SPEAKER_00: So that's another key dynamic going on uh is mass customizing to shift up this progression of economic value.
• 50:12
  SPEAKER_02: That's a great, that's a great answer, uh uh Joe.
• 50:15
  SPEAKER_02: Uh so we have a quick uh rapid fire questions, and uh, I'm going to ask the first question to you, which is what does success mean to you?
• 50:23
  SPEAKER_00: Success is a it's hard to be rapid-fire with that question.
• 50:26
  SPEAKER_00: Success is an amorphous concept, but so quickly I'll say uh success is uh you know, obviously enough money to to support your family and live a decent life, but it is more importantly, it is about fulfilling your purpose in life and doing doing um um you know uh what you love to do in a way that gives you enough material success to live by.
• 50:51
  SPEAKER_01: So, what are some of the books that have influenced you over the course of your life and career?
• 50:56
  SPEAKER_00: Uh, number one, Future Perfect by Stan Davis.
• 50:58
  SPEAKER_00: It changed my life.
• 50:59
  SPEAKER_00: I read it when I was a strategic planner at IBM.
• 51:02
  SPEAKER_00: He's the one who coined the term mass customization uh in that book from 1987.
• 51:07
  SPEAKER_00: I tried, I got it into plans and strategies at IBM where they sent me to MIT for a year to get my master's degree.
• 51:13
  SPEAKER_00: I said, I'm gonna do it on mass customization, did it, wrote the book, discovered the experience academy, rest is history.
• 51:19
  SPEAKER_02: Uh what is the uh what would be your advice to an 18-year-old who's in a who's in a university today?
• 51:27
  SPEAKER_00: Ah, so uh any 18-year-old university, I think, should get out of the bubble of just your individual um major, whatever it is, and expand beyond to understand what's going on into the world, right?
• 51:41
  SPEAKER_00: And and that includes obviously what's going on in economics but politics as well, and culture and and and so forth.
• 51:48
  SPEAKER_00: Um always you learn, and particularly if you are going into business now, um learn how to present.
• 51:56
  SPEAKER_00: Learn how to communicate, right?
• 51:57
  SPEAKER_00: You can have the greatest ideas in the world, but if you can't communicate or present them, then then it won't matter.
• 52:02
  SPEAKER_00: And that's something you can start in in college.
• 52:05
  SPEAKER_01: Uh, who would be three or four guests that you would like to invite for a dream dinner?
• 52:11
  SPEAKER_00: Right.
• 52:12
  SPEAKER_00: So and why make it tougher.
• 52:16
  SPEAKER_00: Um let me see.
• 52:18
  SPEAKER_00: Like I sort of like empty my mind and see who immediately comes to comes to mind.
• 52:23
  SPEAKER_00: And uh so so since it came in my mind, I'll say it, you know.
• 52:28
  SPEAKER_00: Aaron Judge, right, is is uh is a uh New York Yankees ball player.
• 52:33
  SPEAKER_00: I've been a huge New York Yankees fan since I was very young.
• 52:36
  SPEAKER_00: Saw him hit a home run last night, even though the Yankees lost the game.
• 52:39
  SPEAKER_00: So I'd like him uh uh to be there.
• 52:42
  SPEAKER_00: Uh in the world of business, I would um uh love to talk to Howard Schultz.
• 52:48
  SPEAKER_00: You know, he is the CEO of Starbucks, he um uh such a um uh exemplar of the experience economy with Starbucks.
• 53:01
  SPEAKER_00: Uh he's come back to the CEO for the second time because for the second time he recognizes that they're commoditizing themselves.
• 53:09
  SPEAKER_00: I'm actually writing an article on this, a thought post for our blog uh right now.
• 53:14
  SPEAKER_00: So that's one of the reasons on my mind.
• 53:16
  SPEAKER_00: And and and the fact that he's willing to come back and really do the hard work of setting the company right again, I think, is a uh is a great one.
• 53:24
  SPEAKER_00: Um in terms, I'm trying to think also of um other you know sort of pundits and and gurus and book authors and who I'd really like to meet.
• 53:36
  SPEAKER_00: I met Stan Davis, otherwise he would have been on the uh uh on the list uh from the beginning, but nobody's coming to mind there.
• 53:44
  SPEAKER_00: So I'll I'll I'll sit with those two for now.
• 53:46
  SPEAKER_00: That'd still be a great dinner.
• 53:48
  SPEAKER_02: That's great.
• 53:50
  SPEAKER_02: Uh what's one piece of uh advice that you got in your life which you would never forget, uh Joe?
• 53:58
  SPEAKER_00: Um I'll give you I'll give you two from my father, uh, who who long ago told me that uh the answer to every question is it depends.
• 54:10
  SPEAKER_00: And uh just to recognize that that situation, you know, the situation really does matter in terms of what you're answering.
• 54:16
  SPEAKER_00: Um the other thing is he was a great help when I was thinking about leaving IBM and starting my own business.
• 54:21
  SPEAKER_00: You know, it was after the book Mass Customization came out.
• 54:24
  SPEAKER_00: IBM offered me and my wife both six months' salary to leave.
• 54:28
  SPEAKER_00: And should we do that or should we stay and so forth?
• 54:31
  SPEAKER_00: And uh, you know, um and his and I was really wrestling with this, and and his advice was son, whichever way you choose, you'll have a nice life.
• 54:41
  SPEAKER_00: And it sort of like took the pressure off and said, okay, okay.
• 54:45
  SPEAKER_00: And then let me say, okay, well, then I'm gonna go for it, right?
• 54:47
  SPEAKER_00: I can always get another job.
• 54:48
  SPEAKER_00: I'm gonna go for it, see what can happen in this, and I'm very glad I did.
• 54:52
  SPEAKER_01: Joe, what is something that you believe in that nobody else agrees with you on?
• 54:59
  SPEAKER_00: I doubt there's a single thing that I have as a belief that no one else disagrees on.
• 55:06
  SPEAKER_00: There's some, and what immediately came to mind some aspects of theology.
• 55:10
  SPEAKER_00: I do a lot of studying of Christian theology and apologetics, and there's some things I've come up with that uh I've said I then had to, I couldn't find anybody that agreed with me.
• 55:20
  SPEAKER_00: And it took me, took me, it would take me a while.
• 55:23
  SPEAKER_00: Oh, there's one, I got one over here, right?
• 55:24
  SPEAKER_00: So at least I don't think I'm off the off the deep end.
• 55:28
  SPEAKER_00: Um but well, uh, but I'll give you one lately in business that that um um that will require a little more than a uh uh rapid-fire answer, uh, because we haven't talked yet about the fifth and final economic offering and the progression of economic value, which is transformations.
• 55:47
  SPEAKER_00: Transformations when you use experiences, the raw material to guide people to change.
• 55:51
  SPEAKER_00: We talk about healthcare where where it's the outcomes that matter.
• 55:54
  SPEAKER_00: That's what transformations are about, outcomes, not about inputs of the of the experiences.
• 55:59
  SPEAKER_00: You know, fitness centers, coaching, um, um, management consulting, B2B, all those are them.
• 56:06
  SPEAKER_00: And I've had several people lately want to protest and say there has to be a sixth one, because I always say it's the sixth, the fifth and final, as I did then.
• 56:15
  SPEAKER_00: And so I'll and so people have um, it's not that no one agrees with me, but there are people that are now objecting to that and wanting to try and find that sixth one, even though I've got very good reasons why it's only five.
• 56:28
  SPEAKER_02: Great.
• 56:28
  SPEAKER_02: Uh so our last question, Joe, really is now that uh you've heard and uh you know talked to us in contravines, uh who would you think is somebody who you would like to see as a guest in our podcast?
• 56:44
  SPEAKER_02: Uh that now that you uh now now that you know what we do, who do you think would be a guest, who you believe would be a great uh addition to our guest list?
• 56:55
  SPEAKER_00: Uh I would suggest James Wallman, uh who, among other things, is the founder of the World Experience Organization, the WXO.
• 57:04
  SPEAKER_00: He's in London.
• 57:05
  SPEAKER_00: And um he's written a couple of great books and comes from around experiences, cites the experience account, of course.
• 57:12
  SPEAKER_00: But um but one of the things he specializes in is on the personal.
• 57:17
  SPEAKER_00: I'm a business guy, and I want to tell businesses what they should do.
• 57:22
  SPEAKER_00: We've I've been accused of being, you know, so sort of like pro-business and not saying I said I'm guilty as charged.
• 57:28
  SPEAKER_00: He also looks at it from a consumer side, right?
• 57:31
  SPEAKER_00: So one of his books is time and how you how to spend it.
• 57:34
  SPEAKER_00: So he says, you know, looking at all the social science research, right, is that time is the currency of the experience economy.
• 57:40
  SPEAKER_00: It's all about time well spent.
• 57:41
  SPEAKER_00: Well, then how should you spend your time?
• 57:43
  SPEAKER_00: And does a great job with that?
• 57:46
  SPEAKER_00: And uh, and again, as founder of the World Experience Organization, he has a wonderful um um um set of experiences and people that he talks to and perspective that I think would be valuable.
• 57:58
  SPEAKER_02: Thanks.
• 57:58
  SPEAKER_02: Thanks a tanjo.
• 58:00
  SPEAKER_02: Uh it was a fantastic conversation, brilliant examples.
• 58:04
  SPEAKER_02: Uh, I would say the articulation of uh time as a currency for experience, and uh some of the examples were extremely uh you know brilliant and uh it was very vivid as you explained it.
• 58:21
  SPEAKER_02: So thanks a ton and thanks for taking time and talking to us.
• 58:27
  SPEAKER_00: Pleasure.
• 58:28
  SPEAKER_02: Thank you very much, Joe.
• 58:33
  SPEAKER_02: Thanks for listening to this episode.
• 58:35
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• 58:43
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• 59:07
  SPEAKER_02: Thanks for listening and stay safe.