The experience economy: an end to material pursuits?
Jennifer Pinto discusses the prominence and influence of the experience economy in our society.
Over the past 20 years, our world has evolved from tank tops and 10 Things I Hate About You to obsessing over the latest iPhone and Netflix series. However, one trend born in the 90s that has shown no signs of stopping is that of the ‘experience economy’. With the rise of social media and the shifting attitudes in our consumerist society, it is no longer about which brand you bought your handbag from, but about where you had the most memorable time of your life.
The experience economy is described by SM2 Strategic, an innovative healthcare provider, as “a long-term structural change in our economy that has been underway for the past two decades.” The term was first coined in 1998 in the Harvard Business Journal to illustrate the societal rejection of consumerist culture in pursuit of experiences. According to Eventbrite, there has been a 70% increase in spending on experiences and events in the United States since 1987.
If millennials’ spending habits are anything to go by, immersive experiences are likely to remain an important part of consumer society for years to come: according to the marking platform, TrustPulse, around 72% of millennials would willingly increase their spending on experiences. In particular, young adults are spending more on events such as concerts, festivals, and exclusive dining experiences. Rather than wasting away in an office to earn a salary in the hope of buying the latest pair of trainers, millennials are choosing to invest their money in fulfilling experiences. There is a clear realisation that unforgettable moments with friends and family are much more valuable than purchasing objects that will not last a lifetime.
The onset of the 21st century has seen a rapid rise in the experience economy trend, particularly with the birth of social media. The experience economy is evident just by a quick scroll through Instagram: influencers have taken over the platform, with their daily posts of gorgeous Greek sunsets and pretty promenades in Paris. Few could resist being inspired by such exciting adventures and the opportunity to collect unique memories abroad. As travel becomes more affordable and convenient, people are jetting around the world to make these dreams a reality. According to the Guardian, 65% of millennials are saving money towards travel. Airbnb, an accommodation booking platform, is at the forefront of this trend, offering its customers the chance to stay in hundreds of different locations across the world.
Partly due to Instagram, partly due to changes in consumer behaviour, the experience economy has become embedded in nearly every walk of life. Ad Age, an advertising and marketing news website, claims this change in consumer behaviour means that there is an ever-pressing need for businesses to adapt their current models to include “real-time personal experiences”. Companies are having to change what they offer and how they offer their services in order to successfully attract millennial customers. In return, businesses benefit from free marketing, since anyone ranging from your aunt to a famous influencer has the capacity to share and advertise their experience on social media.
Whether it’s museums offering late-night viewings in conjunction with live DJ events, or intriguing installations encouraging multiple-angled selfies, there is no escaping this phenomenon. For instance, Ikea offered 100 fans the chance to spend an all-night extravaganza in Ikea’s Essex warehouse. This exclusive sleepover event massively increased Ikea’s popularity online, as the lucky winners posted their experiences live on Instagram and Facebook. Similarly, Vans has taken on the idea of providing customers with an immersive shopping experience. Their House of Vans store in London is no longer limited to selling shoes: it now offers visitors a host of entertainment features, including a cinema, an art museum, coffee shops, snacks, live music, as well as areas to skate. Pop-up shops are a further example of the experience economy: according to the Association of National Advertisers, the market for these temporary shops is the United States will be $740 million by 2020.
However, immersive experiences come with a few drawbacks. You may have already heard of FOMO, the Fear of Missing Out, first coined by Dr. Dan Herman in 1996. It explains certain individuals’ need to participate in social situations purely to avoid missing out on a potentially exciting experience. FOMO is rooted in a feeling of jealousy and longing, which has only been accentuated by social media. Nowadays people are constantly aware of the events their friends are attending, prompting many to seek out experiences purely for the satisfaction of sharing them on their own social platforms in order to feel equally valid. There is a high risk that society has entered a vicious circle that few can break out of. In fact, the TrustPulse marketing blog states that about 56% of people who use social media have admitted to experiencing FOMO, and approximately 69% experience this on a daily basis.
Having said this, FOMO doesn’t only lead to negative consequences: it can actually encourage you to be more aware, active and ambitious in your life. A last-minute weekend getaway to Amsterdam used to be seen as a hassle, but now we are more driven to take the leap and think ‘why not!’ Furthermore, the experience economy pushes us to consider the value of our purchases; will this item bring me joy in years to come? Will I even be using or thinking about it? Am I contributing to a throw-away culture?
It has become evident that material possessions no longer hold the same importance they did a few decades ago. In the current social climate, experiences are much more impactful: through the powerful medium of social media, they can be both shared with others and remembered for years to come. We now live in a world where the value of objects means little compared to the priceless value of memories.