It�s Not the Economy, People...It�s the Experience! / Michael Terry, Ph. D. / April 2001

Hotel Online Special Report

It�s Not the Economy, People.....
It�s the Experience!

Michael Terry, Ph. D. - April 2001

I continue to be amuzed by the hospitality �economy dumpers�, who blame their own organization�s fate on a slight dip in the econometrics reported for a national or regional or local competitive set. While severe supply-demand can influence all players, a dip in seat or room occupancy of 1,2,3,4, or even 5 percentage points does not signal demise. The economy is a factor, but the experience of the guests is a much more powerful influence. If the experiential moments are filled with positive, distinctive, themed memories, the first time guest will spend more per visit and become a customer and sales disciple for life!

I will give you 10 and then 10 more...incredible company examples why! Drawing upon your own experiences, intuitive logic, and observations of the magnificent results achieved by many of today�s successful, visionary Fortune 100 companies�.you have been tuned-in to the arrival of the Trillion $$ Retail Experiential Economy of the 21st Century! You clearly appreciate the multi-generational, multi-media era of Holographic visual and aural MTV on Home Theater; New Age Culture and Spiritual Phenomena; Interactive Entertainment Webs; Fiber Optics, Nano-tech n� Bots�; Global Obsession and Boutique Everything. You are a believer in the �sizzle�, the �bam�, the glitz, the 24/7 blurrrr where experience, electronics, education, entertainment, and the economy seamlessly fuse. This intersection is the world where we live and work and fantasize. We have entered the electrifying world of E, which I coin �EEEEEconomy�. You understand this new culture. However, do you and your team fully embrace and thrive upon your organizations� � E-possibilities�? Does your operation reflect this new world? If not, can you realistically expect to evoke these markets? Is your team passionate about and driven by the logic of coverting your enterprise into a unique, world-class, planetary icon that thrives financially in the new �EEEEEconomy�?

» Walt Disney, Anheuser Busch, Southwest Airlines, Nike, Rain Forest Cafe, Harley Davidson, Coca-Cola, Wal-Mart, Marriott International, and Anthony Robbins have earned the brand loyalties of billions, but not because those companies sell the absolute greatest products, services, or commodities (so do many others). It is because they sell an accumulation of individual emotional Memory Moments, which define the relationship and determine the future of the hospitality �experience�. They have designed their pre-arrival, experience, and post emotional package long ago, when they envisioned moments such as subliminal web site banners or humanoid tele-inquiries�sense of arrival and signage appeal�on-stage guest interaction and escape pod enjoyment � and follow-up billing opportunity with survey response, thank you, and a come-back offer.

» Smaller successful companies have learned the simple truths of �E� as well: Ben �n Jerry�s, Starbucks Coffee, Grand Theme Hotels, Cirque de la Soleil, Emerald Lagasse, Darden Restaurants, Abercrombie and Fitch, Ian Strager Hotels, Pike�s Place Fish , Blue Man Band, The Kimpton Group, Neuro-Linguistic Programming, Bass Pro Outdoor Shops). Imagine: Today�s icons were mere theme ideas not too many years ago. But by utilizing the basics of Theme Modeling, they integrated these same, consistent, strategic common Branding threads utilized by the larger companies: vision, back-story, icons, image or positioning, distinctive �superior experience�, performance theming, and a continuous passion to re-invent.

» Now is the time for your organization to create a unique advantage that will engulf your vanilla wrapper competitors. Build your incredibly loyal clientele via a relentless customer centric focus. Work with your team, theme specialist, and/or interior designer to realize your customer�s ideal audio/visual aspirations. Create environments for emotional bonding, sensory reactions, and positive mental images. By introducing, re-arranging or enhancing your existing �Memory Moments�, you too can provide guests an �E� to remember, providing every E-reason to return, and more importantly, enlisting them as your �E-sales disciples�!

Thematic Modeling

» The Thematic Modeling concept involves a step-by-step E-nvironmental scanning process, intended to identify experience opportunities. Assess needs for each of your unique, psychographic, client segments; analyze existing on-site customer centric, soft and hard, interactive experiences. Discover sensory, spatial, and emotional components at each stage of the multi-dimensional experience, referred to as �Memory Moment� branding.

» Integrate into strategic environment scenes: on-stage visual, aromatic, nostalgic, tactile elements via color, light, icon images, props, performance theming, costume, script, signage, music and collateral to induce guest excitement and guarantee excessive satisfaction levels

» Introduce your Hospitality leadership team to the elements of Persuasive Guest Engineering (Brain Mapping, Experience Economy, Language and Behavioral Learning, Interactive Theatrical "Edutainment"). This state-of-the art �cause �n effect� approach is the proven formula for success with GenY, GenX, and Boomer audiences.

» Ensure realization of your organization�s on-stage aural, climatic, nostalgic, historical or entertainment aspirations. Once �the show consistently becomes a hit�, customers will develop an emotionally charged loyalty, which will convert to a lifetime sales relationship. This is 21st century guest wants and needs, and this is relationship selling, recognized by companies noted above. This is also the time to introduce purposeful theming to your environment, share thematic elements with your organization�s team leaders, expose them to the incremental revenue advantages of the experiential economy, and to build a more creative culture.

Your company will live or die based on the quality of its EEEEExperiences, not the roller coaster economy! Starbucks CEO says it all �We build our company one cup at a time�. The interpretation here is that a cup equals an experience. Whether occupancy, seat inventory demand, or product/service request levels are 68% or 71%, will not determine your company�s success. In most of our businesses, an average at-risk transaction experience is worth $100-1,000. How each transaction ($100-1,000 x 10 visits = $1,000-10,000) or �Memory Moment� is handled will effect the chances of a guest�s return engagement(s)-for-life. Additionally, this guest will influence friends and family who may purchase (6 Family and Friends x $100-1,000= $600�6,000). This small example demonstrates how just one experience per day will increase or decrease revenues by as much as $2,000,000 per annum. However, as we know, the number of at-risk experiences may be more like 5-10/day.

No hospitality industry company likes economic downturns; and the economic forecast for 2001 is less than robust. However, it is times just like these when you should embrace the Experiential Economy approach. This is the time that world class, highly driven leaders discard the doom vocabulary, pelted with �negative ion (shun) words�: recession, depression, inflation, over-reaction and excess competition. Quite the contrary, these brilliant leaders Soar with the Phoenix as they continuously re-design their future by focusing on vision, proaction, passion, creation, and aspirations, and the distinctive guest relationships. Send your owners all the articles you want justifying the economic downturns, but focus lots of effort on the real influence�.the guest�s distinctive, themed �Memory Moments�. It�s not the experience��it�s the economy!

Michael Terry, Ph. D.

Contact:
Michael Terry, Ph. D.
Experience Builder
Hospitality Futureworks
P. O. Box 890
Windermere, Florida 34786-0890
[email protected]

Michael is a 25 year hospitality futurist, marketer and operator, who consults for national and international, profit and non-profit companies. His Hotel-0nline e-contribution can be read bi-weekly.

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