The experience economy: Key trends for 2017

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Zoe Lazarus, global future and culture planning director at Diageo, explains why experience is the biggest trend in marketing.

The rise of the "experience economy" is currently one of the most important global trends in marketing. Now, more than ever, consumers desire unique, spontaneous and immersive entertainment wherever they are. They want multisensory experiences, beyond sight and sound. However, they don’t want to be restricted to specific venues or times for their entertainment, and crave experiences that say something unique about them, which they can share with their friends and followers.

There is no escaping (and no reason to escape) the role that technology has in how we spend our free time. It will continue to play a huge part in entertainment and, as it becomes more sophisticated, brands will need to follow suit. Consumers will always rely on brands for entertainment, but it’s the brands that react quickly to the changing trends that will thrive in this spontaneous, immersive and shareable world.

How consumers socialize is constantly changing, and brands need to be agile, flexible and quick to adapt to meet their needs. Enhancing people’s leisure time is at the heart of our strategy at Diageo, and ensuring we are at the forefront of understanding how people want to spend it is crucial to growing our business. 

In my role at Diageo, I focus on assessing emerging trends and looking ahead to new developments, to futureproof our brands and our business accordingly. 

Part of my work is to study the way in which people are socializing around the world and how this is changing. Through this work, we have uncovered five key trends that are shaping the way brands connect with consumers through entertainment. 

Entertaining with tech: how brands can make the virtual world as compelling as the physical

Our love of screens has shaken up how the entertainment industry delivers content and consumers socialize. Today, more than a third of the world’s population owns a smartphone, up from just under 10 percent in 2011. Facebook has 1.79 billion active monthly users worldwide, with five accounts created every second, while, on average, 95 million photos and videos are shared on Instagram every day.

People’s social lives are becoming more public—captured as they happen and shared far and wide. A night out becomes a performance in itself; every moment is captured and shared and the experience is curated for friends and followers. A proliferation of easy-to-use tools means consumers also have considerable creative control over what to broadcast. It’s no longer necessary to be in the same room as the people with whom you are sharing incredible social events. 

"Brands need to be ready to respond to consumers seeing the virtual world become as compelling as the real one"

The number of active virtual-reality users is forecast to reach 171 million by 2018, according to Statistica, making immersive experiences more widely accessible than ever. Brands need to be ready to respond to the fact that consumers will start to see the virtual world become every bit as compelling as the physical one.  

Diageo is exploring the possibility of alternative reality with an immersive VR adventure that has allowed whisky fans to discover and appreciate the flavors of its Singleton Single Malt Scotch Whisky. 

The first flagship event took place in August 2016 at Epicurean Market, a three-day food and drink festival in Singapore. Visitors were given a VR headset, earphones and a dram of the whisky to taste. Over the next two-and-a-half minutes, they were transported to Scotland for a tour of the Glen Ord distillery, where the whisky is produced, one of the oldest in the Scottish Highlands. During the experience, the visitors were prompted to savor the whisky as they moved from one scene to another, immersing themselves in the complex range of flavors that make up the drink.

Looking into the future, advances in VR entertainment will provide brands with new opportunities to entertain consumers. VR will help to break down geographical barriers to socializing and allow consumers to play with friends across the globe, as well as offering them the chance to explore new brand worlds.

New social spaces: bringing products to the people – wherever and whenever they are socializing  

Consumers’ social lives are becoming more spontaneous. The nine-to-five working day is in decline as work hours become more fluid and less structured. Consumers no longer need to plan events far in advance. Instead, WhatsApp group chats mean impulsive plans are made in seconds. 

In parallel, the boundaries between social and work space no longer exist. We are seeing a huge rise in co-working spaces; workspace company WeWork has 54 co-working locations across the US, Europe and Israel, and the industry has 7,000 players worldwide. Brands need to adapt to the impact of the new working day, and the increasing blur between consumers being on or off duty. 

"Brands need to be ready to respond to consumers seeing the virtual world become as compelling as the real one"

Socializing and entertaining are no longer predominantly Friday or Saturday night activities, and consumers are demanding a wider variety of spontaneous socializing locations. From Brazilian bank Itaú placing karaoke machines on the beach, enabling people to indulge in spontaneous fun, to the co-workspace Hive in India, which transforms from a workspace into a creative hub in the evening, consumers are enjoying more varied and fluid socializing.

Festivals are changing, too—going beyond music to offer an eclectic mix of interactive events and sensory delights. Interestingly, we are seeing evidence of this trend manifesting globally. The Eko Carnival in Nigeria is hosting an extensive variety of activities, including comedy, theater and music. Event organizers are adapting to meet the needs of time-poor consumers; examples include those behind Love Bang in China and Citadel in London, who have condensed what might once have been a week-long festival into a single day or night.

We are committed to creating products for consumers wherever and when-ever they want them. We’ve made Smirnoff a feature at music festivals and between March and September 2016 sold more than two million drinks at European festivals alone. In Brazil, Smirnoff X—a line of Smirnoff and fruit juice drinks—is the first vodka product in the country to be sold in a screw-cap carton, offering practicality for consumers drinking at different social occasions. 

Brazilian bank Itaú put karaoke machines on beaches for public use

Multisensory socializing: to escape from the norm, consumers want their sensory boundaries to be pushed when socializing

Consumers are looking for experiences that are experimental or uniquely memorable and immersive. Sensory science is on the rise and people now expect their drinks to come with a side order of surprise, immersion and sensory delight.

Diageo’s Singleton Sensorium was the world’s first multisensory experiment looking at the effect of environment on the taste of whisky. Held in London’s Soho, participants were invited to enter three "magical" and cinematic worlds, noting how the different sounds, smells and visuals in each space enhanced the flavors of The Singleton Single Malt Scotch Whisky. 

The event was run in collaboration with Oxford University, with the design rooted in sensory science. We believe such a blend of drinks, sensory architecture and science gives a glimpse of how bars of the future will be designed, where every element enhances the drinking experience. 

Across the globe, we have seen the rise of immersive, multisensory entertainment. For example, experimental theatre company Punchdrunk has expanded beyond the UK to New York and Shanghai. Its experiences plunge consumers into settings as diverse as outer space, the Amazon or the 1940s. Meanwhile, Cinesthesia is a multisensory film experience that transforms traditional viewing.

Diageo’s Singleton Sensorium was a sensory experiment

Home as the new destination: responding to the desire to make homes the ultimate bespoke venue

A proliferation of on-demand experiences and services has shaken up the UK’s £9 billion food-delivery sector, enabling people to entertain at home with products and experiences available at the touch of a button. Consumers can now host events that previously they would have had to go out to enjoy. 

Supermarkets are engaged in fierce competition to offer consumers the best restaurant-quality pre-prepared meals, while Deliveroo and UberEATS offer far greater choice and quality than traditional takeaway providers. For its part, Diageo has launched thebar.com as a store on Deliveroo, to allow consumers to have their favorite spirits delivered to their door. 

"Consumers look for experimental or uniquely memorable experiences"

Home is becoming a destination in its own right and consumers are using technology to curate their own experiences and ways to socialize and entertain there. The must-have Christmas gift of 2016, Amazon Echo, gives us a taste of a voice-controlled future, with capabilities that include playing music, controlling heating and lighting, and ordering take-aways and taxis. 

Diageo has launched a Johnnie Walker digital mentorship programme, available on Amazon Echo, heralding an era of whisky education that can be enjoyed by adults in the comfort of their home. Whisky fans can chat live with the Johnnie Walker messenger bot and learn about whisky, get cocktail recipes and blend recommendations, and find out where to buy the product. 

Johnnie Walker Black Label offers a virtual education in whisky

The age of experimentation: consumers want to experiment within their social lives and with their products

Consumers are seeking unique experiences, and traditional entertainment venues are reinventing themselves in response. New venues show how imbibing has become a unique experience. From the "menu-less" Tailor Bar in China, where all drinks are bespoke, to Black Rock in London, where guests drink from a "river of whisky" contained in an old oak tree, venues and brands are offering people something different.

Consumers are showing a greater desire to try, test and taste products that demonstrate their individuality. Artesian, the bar in London’s Langham hotel, is creating "emotional cocktails," where bartenders tap into customers’ personal experiences by creating drinks that capture their mood and essence in a glass, while AQB, also in London, allows consumers to create their own cocktails as part of a Breaking Bad-inspired chemistry session.

Increasingly, consumers are sharing more of their lives on their chosen social channel, and the status derived from trying novel things, as well as being involved in the creation of events, is key. They want to portray themselves as being involved in the process. 

For us, collaboration and immersive socializing are combined at the product development stage. Two nights a week at Guinness’ Open Gate Brewery in Dublin, we open the doors to beer fans. We’ve created a platform where consumers can trial fresh Guinness innovations, and we invite their feedback every step of the way. Enthusiasts have a chance to meet the brewers, discuss the process and sample recently launched innovations from around the world. They can also try early, small-batch exclusive versions of experimental brews and vote on which Guinness products they would like to see on the shelves.

While technology continues to play a big role in entertainment, the industry needs to react quickly and bring new experiences and brands to market to satisfy an increasingly sophisticated, discerning and demanding audience.

Guinness fans trial new products at its Dublin brewery two nights a week