With the soporific amount of dreadful business phrases generated so far this century (here’s looking at you, ‘Thought Leader’), you may have missed hearing about the ‘Experience Economy’. However, if you aren’t aware of what this term means and how it could impact your business, then now is the time — especially if you are working within the travel industry as a hotelier.
The experience economy, put simply, describes where most of the western world’s ‘holiday’ money is being spent. Simon Usbourne of The Guardian sums it up best: ‘New figures show we are continuing to spend less money on buying things, and more on doing things — and telling the world about it online afterwards, of course.’
For the most part of the previous century, material objects have been the dominating factor in determining social status. One would work to obtain enough to ensure your family had a stable existence, a house, and food, then beyond that would pursue specific items recommended as being desirable; a Rolex watch, a diamond necklace or a flash car.
As the only part of you that strangers saw was immediate and physical, in a time before social media and the possibility of displaying endless personal information, the only way to present your physical self as financially buoyant was through these obvious visual cues. The world was also more obsessed with ‘the commodity’ — a couple of generations before, ‘the commodity’ simply didn’t exist in the same way, and so the prospect of being able to earn enough to buy yourself or your family a special treat was thrilling and understandable.
However, as James Wallman, trend forecaster and author of Stuffocation: Living More With Less explains, 'Although it used to be that our car, handbag or wallet showed our status, now we post Facebook pictures from a chairlift in Chamonix or the latest music festival….posting pictures of what you just bought is gauche; posting pictures of something you’re doing is fine.'
Gauche is the word; celebrities dripping with jewelry that post a decadent image of themselves are seen as hugely unsympathetic. In a time where child refugees are being sold into slavery, neighboring countries are at war and where the poverty line appears to have become for many a daily income, to present oneself as well-off through material objects is increasingly distasteful. However, the same cannot be said of the same celebrity who attends a basketball game, a festival or a wildlife sanctuary — despite the fact that the cost of those experiences may have been the same/more as the material equivalent. Those celebrities are seen as valuing life over possessions — and that is very in right now.
Where celebrities go, the public follow. Where before our money may have gone on something tangible, for those fortunate enough to have extra income there has been a monumental shift towards the purchasing of ‘an experience’ over something that could be seen instead as showing off. This is where hotels have suffered, and airbnb has seen their profits fly — instead of being closed off in a little bubble with soaps and towels, airbnb offers guests the chance to ‘Live like a Local’ and experience the destination; thereby allowing the participant to also post pictures of themselves flirtily buying fruit from a local market rather than ploughing into the hotel breakfast buffet.
Airbnb then further capitalized on the experience economy momentum by initiating their superhost program; '…an alliance of 'extraordinary' Airbnb hosts who create unique and meaningful stays for their guests. This will grow the number of listings that go beyond pure functionality (i.e. having a cheap place to stay) and thereby cater to the needs of travelers who look for authentic, personal and valuable experiences.' So sums up the Digital Tourism Think Tank.
Bearing all this in mind, it is easy to see where traditional hotel stays and traditional hotel profits have suffered. So, how can hotels compete and change this tide?
Below are three simple steps to capture the experience economy market (because it isn’t going anywhere) and to make sure that your business doesn’t get left behind:
1. Brand Identity
Take some time, if you haven’t already, to define what the individual experience is that you offer your guest.
- Are you in a fascinating historic building? Does your establishment offer access to beautiful countryside? Is there any interesting art in your hotel
- Then, define your brand and approach your correct target audience.
- Where do they get their information from? Print? Email? Social media? Imagery? Memes (hopefully not memes)?
- What language do they use? Is it imagery? Text? Long form?
- Then go out and sell to the right people in the right way with the right product. You’ll see a huge return on just this simple bit of research.
Here are two hotels that have done this perfectly:
Ace Hotel, London
- With 53,000 followers on Twitter, Ace Hotel clearly understands that their audience are millennial, tech savvy and consume their information through social media.
- Their website reflects that, using cool neutral colours, minimal text, and a collection of photographs that build up the personality of a hip artist rather than a building.
- There is also a prominent list of nearby events happening — all of which are arty, trendy and very Shoreditch.
- With the understanding that their target audience is older and consume their media through traditional print and long-form text, their website is far more in-depth and provides all the information required without you having to leave.
- Longer paragraphs, images of well-dressed middle-class people and buzzwords such as elegance and sophistication appeal to a visitor looking to experience a world of luxury.
2. Understand Your Individual Guests Needs
Personalization and innovation is the only way forward for marketing.
- You can see it everywhere — social media platforms that adapt what they show depending on who is looking. Retailers that offer to curate potential purchases. Music platforms that put together whole lists of songs, using algorithms and gathered user data, that are guaranteed to please each individual.
- The package holiday has been faltering for a long time, but for some reason until recently many hotels felt they could also present a ‘one size fits all experience’; namely ‘airbnb, the ‘choose your own adventure’ brand.
- How to personalize to each guest effectively then, when you may only have a few tools at your disposal? Build on the points above, keep it simple, don’t pester.
Here are two hotels that have really managed to do it well:
- The Sheraton Bratislava uses publicly available information shared on social media by guests to design welcome gifts, ideas for trips during their stay and, more importantly, to show they care about each individual that stays with them.
- The gifts that are given to guests are not extravagant, which even adds to the appeal.
- For example, one guest enjoyed taking photos of their travels and sharing them on Instagram, so the hotel provided a hand-picked selection of photos of Bratislava for the guest to enjoy.
Choice Hotels: Travel Top 6, Europe
- Choice has understood that their guests are generally in the area for a specific event i.e. a conference, festival or trade fair, rather than just aimlessly on holiday.
- They have created a whole separate site with an emphasis on these events but also providing simple dining and drinking suggestions nearby that cater specifically to that crowd, all in the form of short blog posts and take-away map guides that can be used on the go.
3. Connect With Your Chosen Experiences
Finally, interact socially with the community you are catering for; whether that is the local community, a specific societal group or simply a traveler type.
- Have your name become linked with that community, and become the first choice for that group and the place that they recommend because you provide the correct ‘experience’ for them.
- This can be done by reaching out to the community for feedback, hosting specific events at your hotel and outreaching to groups via targeted social media or email campaigns.
- A stay at your establishment should be seen as a wealth of opportunities rather than just a room and board.
- The fastest and easiest way of doing this is to provide an area map with guide to your concierges chosen highlights. The best is one that you can not only embed on your website and share on social media, but also have guests use on-the-go practically around your local area.
- Innovative app and map system Pearlshare has begun to provide this service to a variety of boutique hotel clients, though there are other more complex tools, such as Google maps, available for a less personalized embed.
Here are two hotels that have connected very effectively with their chosen experiences:
Living Rooms, London Various
- Living Rooms has crafted their identity around offering the comforts of home but with the style credibility of a boutique hotel.
- There are several interviews on the website with high-flying fashionistas that take place in the Living Rooms establishments, giving the feel of an active stylish community.
- They have themed maps to the local area that then follow the footsteps of the interviewers; the Louis Vuitton City Guide for example, or the Specialist Food Shops Guide.
- Guests can then use these on-the-go, as well as see the practical impact of gaining access to that community.
Artists Residence, UK Various
Positioning themselves as the hotel chain for eccentricity and artistic guests, Artists Residence hold frequent art shows, have local and renowned art on the walls of the hotels and get in reviewers who hold a position of credibility in the art world rather than just standard reviewers.