Two years ago Professor Chris Voss of the London Business School gave a talk on the emerging experience economy. Now he has credited Foviance with understanding the lessons of its findings. Check out his report highlights and see if the trends he pinpointed have progressed...

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"Trends in the Experience and Service Economy: The Experience Profit Cycle"

By Professor Chris Voss (London Business School – March 2004)

This report gives the results of research that set out to identify some of the key management and business trends in the realm of experience. From this research a set of key themes emerged:

1. Experiences - A key innovation in today’s business is experience.

In today’s environment of ever more sophisticated consumers – those who deliver memorable customer experiences consistently create superior value and competitive advantage.

• Experiences are now part of the offerings not just of leisure and entertainment, but of business in general
• The use of customer experiences to create value has been called the experience economy. Innovative companies are building portfolios of experiences to support their products and services and to build brands

2. Branding - Experiences create strong emotional ties that are a powerful tool for creating brand equity and differentiation

3. Destinations - Services including retail, leisure and sport are increasingly creating destinations that provide a powerful model for profitability and growth.

To create successful destinations, organisations are:

• Building a diverse and changing set of experiences, promotions and attractions so that customers will want to return
• Moving from venues with a single focus whether it be retail, sport, or entertainment to one where there are multiple activities that attract people more often and for longer
• Designing destinations that remained focused, but meet the needs of multiple segments
• Building retailing as a destination

4. Management challenges - Becoming part of the experience economy and creating destinations pose a set of management challenges that are different from those of regular business.

The research identified a set of key challenges and proposes five imperatives for effective experience management:

1. Manage experiences as theatre
2. Use experience to build brand equity
3. Balance control and spontaneity
4. Manage conflict between creativity and business
5. Develop and use appropriate measures

5. The Experience Profit Cycle - Successful experience and destination organisations build for themselves a repeated cycle of investment and management, vibrant experiences, customer growth, profitability and reinvestment.

6. Roadmap For Transformation - The experience profit cycle, the key imperatives for managing experiences and the destination model provide a road map for change.

About Foviance:
Foviance, the expert in customer experience across digital channels, is breaking new ground with its Experience Management Service. This unique offering blends web analytics with usability consultancy to help businesses deliver effective customer experiences across digital platforms. The service is available across all digital channels including the Internet, interactive TV and mobile. Foviance is at the forefront of the experience economy as it applies to digital platforms. Its consultancy and services are used by clients including Barclays, Sky, Nokia and Microsoft. Chris Voss, Professor of Operations Management at the London Business School, was quick to pick up on the growing importance of customer experience for today’s businesses in his report Trends in the Experience and Service Economy, which formed the basis of an event hosted by Foviance on 16 December 2005. www.foviance.com/