In The Experience Economy, Joseph Pine and James Gilmore argued that in an era when consumers were more sophisticated than ever before, it was no longer enough to meet their needs with commodities, goods, or services. They argued that to compete in the modern era, you had to make their interaction with your business an experience, compelling enough to be memorable such that the memory itself becomes the product. They relied heavily (and convincingly, in 1999 anyway) on examples from Disney, Starbucks, and Nordstrom to make their case.
As fun as the book was to read for it’s descriptions of the various experiences that set these companies apart, the key takeaway for me had less to do with building a compelling experience for the customer but everything to do with charging for it. The question was asked, how should a business charge for its experience?
Charging for commodities, goods, and services is typically based on supply and demand. But an experience defies that pricing model by holding most of the value in the experience, not the service provided.
They argued, as if the answer should be obvious to everybody, that a company should charge for the parts of the experience that are valuable to its customers.
Disney is the best example here because unlike many amusement parks it doesn’t charge for rides, but just for admission. If it charged for rides, it would be pressured to focus on those to the detriment of the colorful experiences that surround them.
One of the most valuable things to come out of The Experience Economy was a filter through which I could look at a business, mine or somebody else’s, and tell you exactly which part was the most valuable to me. Which part was the competitive differentiator. Which parts were worth paying for and which just aren’t.
There are some blogs that I read where I may not be willing to pay a subscription fee, but maybe I’d be willing to register. Maybe I wouldn’t be willing to register, but I’d be willing to click through a full screen ad every day. Maybe I wouldn’t be willing to click through an ad, but I’d be willing to close a prompt asking me to email a link to today’s post to a single new friend, or share it on Facebook.
If you’re not doing any of these things for your blog, you may not be charging enough. Pine and Gilmore offered a second justification for their pricing model: they knew that companies focus on what they charge for. Things given for free are rarely improved enough to be compelling or memorable.
As a blog reader, I’m interested to know: if you were guaranteed twice the money you’re making now on your blog, would you agree to improve the experience by that much? If someone offered you that deal today, how would you do it? More research? More posts? More guest interviews? More live blogging of key industry events? More eBooks and slide decks and other useful giveaways?
If someone is coming to your blog today, you’re already providing a valuable experience. What would make it worth paying for? You may be closer than you think.
About Jonathan
i love this post. Wallace Wattles Author of the Science of Getting Rich Says to give more in use value than i cash value.
And International Speaker and author Dr Myles Munroe says that a law of entrepreneurship is to be willing to pay for anything that will help you achieve your dreams.
Way to Go.
BTW, I LOVE YOUR BLOG KIESHA EASLEY!
.-= Olusegun´s last blog ..27 Bad Ways to Build Links =-.
Insightful and very well said. Really, there is nothing like a free lunch. Genuine entrepreneurs pay for what will move them ahead.
For twice the money I’d do everything in my power to improve the experience at least three times as much for my readers. I’d do it by outsourcing research, seo, development… All those things that consume time and take you away from putting out the product your customers expect.
.-= B. Durant – Identifying Snakes´s last blog ..How to identify a snake =-.
I really like your post Jonathan.
There is the general perception that the service that attracts a fee is more valuable than the freebie. Regardless of how much hype surrounds the freebie. Your ending question really provoked my thought to a much higher level for creating a more valuable experience and product through my blog. Its time to start producing content that people will pay for.
.-= Robyn from Sam’s Web Guide´s last blog ..10 Brilliant Tips For Creating Killer Content For Your Blog =-.
Thanks! I could talk about pricing strategies and alternative revenue streams for days. My domain, enterprise software, is undergoing a shift where people are kind of expecting stuff to be free. As a result, companies like Red Hat no longer even charge for the software, they just give it away and make their money on the support. I’d be surprised if we don’t start to see similar models become more mainstream in the online marketing/blogging community.
.-= Jonathan Brill´s last blog ..You’re Not Charging Your Readers Enough =-.
Great thought provoking post here. I try to provide quality content that people want to read but you really gave me ideas to take it a little further. Why not offer them a small report or even go a step further and offer one-on-one consultations with a certain amount of people. Thanks for really getting the gears turning for me today!
.-= Tiffany´s last blog ..How I Choose Amazon Products to Promote on a Niche Website =-.
Twitter: weblogbetter
says:
Hi Tiffany,
I’m glad you found this post helpful. Jonathan has really presented some refreshing ideas here.
Hey Jonathan,
Great perspective that you are bringing to this post. When you charge it is perceived to be more valuable than giving it away for free.
This is a business strategy I learned from Real Estate. When I was charging a fee to work with me. I had a line of people wanting for me to help them buy and sell their home. Where most agents were free and providing their services for a very cheap commission. Great topic!
Chat with you later…
Josh
.-= Josh Garcia´s last blog ..4 Simple Strategies I Apply For Writing Content Everyday… =-.
Twitter: weblogbetter
says:
Hi Josh,
You’re right about this fresh perspective Jonathan has brought to the game – it’s funny because I had been thinking on this just recently, that readers come to our blogs, not just for information, but for an experience. If we can make them feel special and create and engaging and entertaining experience, before we know it people will want to be associated with us. We won’t have to look for them, they’ll come to us.
I do try to write my posts with the same level of attention I put into material I get paid for in other markets, so I’m good there. That said, I haven’t completed any reports or ebooks yet so this is an especially good reminder to focus on quality when I work on those projects.
.-= Jean Sarauer´s last blog ..When Bad Things Happen to Good Bloggers =-.
Twitter: weblogbetter
says:
Hi Jean,
It all takes time – but you’ll be amazed how much more an ebook can help – in addition to income you could earn for selling it, you could also include affiliate links that could bring you additional income later on.