🎢 Sports, Spa and Surreal Food: How the Experience Economy could Help India Grow
78% millennials prefer spending on EXPERIENCES vs TANGIBLE THINGS! Let's see how brands are capitalising on this behaviour! ReadOn...
Today's generation in two words: "YOLO" and "FOMO".
And the economy is loving this attitude! After all, it increases consumption and contributes directly to economic growth.
And no, millennials don't just want things. They want experiences.
78% of millennials prefer spending money on experiences rather than on things.
So, today we'll look at:
Why is the experience economy suddenly trending?
How can brands leverage great experiences?
How can India benefit from the experience economy?
📷 Do it for the Gram!
The Experience Economy isn’t a new fad.
Harvard Business Review talked about it in 1998! How did they discover this hidden economy at the time?
They looked at historical patterns (yes, history is important) and understood consumer psychology.
When capitalism took over the world, goods became commoditised (meaning it did not matter which player's goods you took).
So, brands had only one way to differentiate themselves from their competitors: focus on services.
But services are also getting commoditised now. It doesn't matter whether you order from Swiggy or Zomato!
What now? How can brands stay ahead of competition?
By creating a great customer experience. By creating that 'aha' delight moment for your customer.
You see, humans live through experiences. We always remember an experience, whether good or bad.
And another millennial behaviour at play now: Experiences are Instagrammable!
And the ones benefiting the most from this new trend: cafes and restaurants.
If you run a cafe, here's a simple recipe to go viral in minutes:
A whole lot of great aesthetics
Great ambience and some music
Pinch of food
Tie up with influencers
That's it. You're all set to go viral once these influencers use trending hashtags like #foodporn and #foodstagram!
But cafes and restaurants are not the only ones going big on experiences.
🛍️ Shoppertainment: The New Trend in Town?
Brands like Nike, Sephora, Adidas, and LuluLemon have realised the power of experiences long ago.
Nike's Niketown stores don't just sell shoes, they sell experience.
You get to experience Nike shoes by engaging in a range of physical activities. The best part?
You get to hang out with a community of people just like you.
This defines a 'peak' moment in our minds and makes us want to visit the store again.
Voilá, Nike has cracked brand loyalty!
Other Indian brands like Zomato are also taking cues from this.
After weddings, the only thing we can see on our Insta feeds is super cool Zomaland pictures (and thousands of reels from Anuv Jain’s concert)!
💡ReadOn Insight: This “shoppertainment" could be this decade’s marketing trend, with more brands hopping onto the bandwagon.
It may even be the one that stays.
But the experience economy isn't just a method of selling.
It is slowly becoming part of our lifestyle.
Don’t believe us? Here are some cold hard facts…
🌍 You’ve Got to Experience it Once!
After Covid…
Luxury dining saw a 120% rise!
Indian Hotels Co. Ltd (which owns Taj Hotels) saw a 50% month-on-month increase in spa treatments.
Urban Company saw a 250% spike in demand for massage and spa services.
Now, you may think this hype was just post-Covid revenge spending.
But once you go luxury, there's no way back.
What about the money?
Well, nuclear families and rising disposable income is set to almost double our per capita consumption spending from $2,000 to $5,000.
Still not convinced? Neither were we.
So, we dug deeper. And we found that millennials aren’t just obsessed with luxury and therapeutic experiences.
They want their experiences raw, sweaty, and full of adrenaline.
Two such painful yet exciting experiences that are catching on like wildfire: Marathons and adventure sports.
Thanks to celebrity endorsements, charity tie-ups, and good old cash rewards, marathons have taken over in India.
Over 40,000 runners participated in the Vedanta Delhi Half Marathon and there are 1,579 such annual events in India!
Thanks to this, the running ecosystem in India is worth $400 mn annually!
💡ReadOn Insight: If one sports event can ignite this craze, imagine how much more local level sports tournaments could earn! Plus, this seems to be the perfect time to launch an Indian origin shoe brand that could compete with the likes of Nike and Adidas.
Not just running, Indians are going all in on bungee jumping, parasailing, and scuba diving.
In fact, for millennials, Rishikesh isn’t just a holy place anymore. It is an adventure sports hub.
And contrary to popular belief, over 84% of Indians travel domestically for adventure sports.
Thanks to this, the adventure sports economy in India is set to be worth $2 bn by 2028!
This is a great untapped market for India. If we focus more on adventure sports, we could become the next Dubai for the world.
Dubai has smartly positioned itself as one of the biggest adventure sports hubs by creating wonders like artificial caves and deep underwater pools.
Plus, with yoga now catching the Western fascination, we could make a killing by selling wellness retreats.
The time is ripe: the sooner, the better!
What do you think is stopping us from tapping this market? What else can we do to boost this economy?
🧠 ReadOn Recommendation: if you want to understand how experiences leave a long-lasting impression on the brain, and how brands leverage this to create 'peak' moments for their users, you can read 'The Power of Moments' by Chip Heath and Dan Heath.
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