Customers continue to say they favor small, local retailers over large, national chains. A growing body of scientific studies indicate that experiences, not objects, bring the most happiness, especially among people in their 20s and 30s. Together, these trends suggest that small retailers have a unique competitive advantage if they focus on their one-of-a kind experience as much as their one-of-a-kind merchandise. Emergent Research’s Steve King, a regular contributor to SmallBusiness.com, provides this overview of a trend he expects to expand.
The coming-of-age of the “Experience Economy”
A recent New York Times article explores the growing trend among customers—especially the coveted ones in their 20s and 30s—toward purchasing experiences over objects.
“Analysts say a wider shift is afoot in the mind of the American consumer, spurred by the popularity of a growing body of scientific studies that appear to show that experiences, not objects, bring the most happiness. … (They) would rather spend their hard-won cash on out-of-town vacations, meals with friends, gym memberships and, of course, their smartphones, many surveys suggest.”
Of course, this is not a new trend. The 1999 book The Experience Economy covered this shift in detail. But the rise of social media has led to people wanting experiences they can post about on Facebook, Instagram, Twitter and elsewhere. This is clearly helping drive the growth in experiences. We’ve seen this many times in the work of Emergent Research with the growth of food trucks being a great example.
Retailers are turning into “Third Places”
The retail industry is fighting back by trying to provide more experiences as part of the shopping experience.
According to the advertising giant JWT, retailers are turning into “third places,” which are increasingly focused around experiences, unique environments and customer service—giving shoppers new reasons to spend time in these spaces.
Experiences are winning over things
This is a trend we expect to expand.
And it is a trend in which small, independent, local retail merchants could have an advantage over big, national chains if they focus on their natural one-of-a-kind uniqueness as much as they do their products and merchandise.
(Note: A version of this article also appeared on SmallBizLabs.com.)