Separating Transactional and Situational Experiences
In discussing the experience economy the point is always raised that the word experience has multiple meanings and applications.
In a business setting, experience is the feeling the customer has during their interaction with the business. It can be paid for, can make up a percentage of the charge, or be a a marketing tool to differentiate and encourage more ardent word of mouth.
Experience is also historical. Time and effort in an area grants a person experience in a particular field or ability. An experienced person is therefore considered as a wise person, who not only has knowledge but first-hand experience.
Life experience is also often negative. Tough situations and hard times are often the motivation and bedrock of change.
Transactional and Situational
One of the hallmarks of experience economies, according to Pine and Gilmore, is customisation. The photography studios that create highly personalised family portraits, the 23andme.com service that analysis one of your most personal assets: your DNA, the personal shopping industry that is rising – these are all highly customised, highly memorable and highly compelling.
A transactional experience is one of the above. The customisation of the product is such that the product is not consumed, it is experienced. Non-consumer transactions include presents and personal creations such as music and art for a person.
But say a highly customised gift is given from one friend to another. The transaction is not only experiential, the moment is. This is a situational experience. Opera and theatre, a sports match, a compelling event – but also a holiday, a hard time perhaps, a difficult personal situation. These experiences are based around space and time.
The lines between these two are easily blurred. But it must be noted that success in one and failure in the other can occur. Starbucks does not offer a compelling situational experience. Yet the transactional experience has become the world wide leader in mass market coffee.
Disney World, on the other hand, offers poor food and does not offer the scariest rides. It’s transactional experience is low, but the situational experience makes it one of the greatest family holidays in the world.
Businesses, charities, organisations should then be aware of both.