According to the business consultant, Joseph Pine, there has been a fundamental change going on in the fabric of our modern economy. If you work in retail it’s something to be aware of because it is at the heart of what modern consumers really want from retailers.
In the beginning our economy was based primarily on things that come out of the ground. For example, before greeting cards or paper, we harvested trees for timber and sold it on the open marketplace. Commodities like minerals, animals and vegetables were the basis of the agrarian economy that lasted for millennia.
During the Industrial Revolution goods became the primary economic offering. Goods like paper and card were manufactured using commodities like timber as a raw material. Over time, goods have become commoditised and people don’t care who makes them. They care only about price.
There's an antidote to commoditisation and that is customisation. Customising a good automatically turns it into a service. Henry Cole needed a more efficient way than writing individual letters to connect with friends at Christmas and so the first greeting cards were commissioned. Over time some services can be commoditised as well. If all designs on cards stayed the same and fashions didn’t exist then that is what would happen with cards too and people would only care about who sold them the cheapest.
When you customise a service that is so appropriate to a particular person at that moment in time you can't help, but make them go ‘wow’. It turns it into a memorable event and becomes an experience. Think of a beautiful greeting card shop, Disneyland or boutique hotels. Experiences are what consumers most want these days and they want them to be authentic.
Some people like to differentiate between levels of authenticity. They might say that Disneyland is less authentic than hiking through the mountains or that spot UV printed cards on ensocoat feel less authentic than letter pressed cards made with GF Smith colourplan. The truth is there is no such thing as an inauthentic experience because experiences happen inside of us. They are our reactions to the events staged before us.
You could also argue that there is no truly natural authentic experience for, even if you go for a walk in the woods, there is a company that manufactured the shoes you walk in, your phone, the car you got there in. These are all manmade ‘artificial’ elements brought into the woods by you.
In the new experience economy, authenticity has now become the new consumer sensibility and the buying criteria by which we choose who we buy from and what we are going to buy.
If you can look at how each of these economies developed you can see the imperative or business focus that is needed to meet the need of the consumer sensibility:
What’s needed now is the ability to render an authentic experience, because you have to get consumers to perceive your offering as authentic.
This presents a paradox because nobody can have an inauthentic experience (they happen inside of us), but no business can supply one (all business offerings are manmade objects, involve money or machinery). All those factors make things potentially inauthentic. So how do you render authenticity?
There are two dimensions to rendering authenticity:
1. Be true to yourself, which is ‘self directed’.
2. Being what you say you are to others, which is ‘other directed’.
These dimensions create a two by two matrices for businesses.
A business that is true to itself and is what it says it is to others renders the most authentic experience, it’s REAL REAL. The opposite of this is FAKE FAKE. Interestingly, there is always a desire somewhere in the economy for fake. Think of cheap knock offs of Tatty Teddy cards on market stalls.
Businesses do exist in these other modes of authenticity. REAL FAKE is exemplified by the Universal City Walk. It looks like a real city, but it’s made of scaffolding and wood. It’s a real fake of the City of Los Angeles. Disneyland on the other hand is FAKE REAL. It’s a fake reality. Sadly, it’s not really a magic kingdom and yet it is wonderfully true to itself.
The easiest way for businesses to fall down with all this is to not understand their heritage and not be true to that heritage. In a way it doesn’t matter where your business sits on this matrix, the key to being is to be true to yourself and know who you are as a business. What are your core values?
Knowing your heritage is knowing what you have done in the past. Sometimes this can limit what you are able to do in the future. You have to understand your past. For example, twenty years ago Disney, which is best known for family values, bought the ABC network and Miramax. These two businesses, which produced adult rated content, were in direct conflict with their core values. So families couldn't really trust Disney’s heritage. It was no longer being true to itself.
To be authentic, it’s really important to be what you say you are. The biggest mistake companies make is to advertise things that they are not. That's when you are perceived as fake - advertising things that you are not. Think of any retailer that has the word ‘quality’ in their title above their shops. Most of the time these signs look knackered and the business is anything but quality. They appear disingenuous and inauthentic.
How To Be Authentic
The number one thing to do when it comes to being what you say you are is to provide places for people to experience who you are - it's not advertising that does it. That's why some retailers don't need to advertise at all. They're saying if you want to know who we are you have to come and experience us.
Think about the economic value they have provided by the greeting card retail experience. At its core greeting cards are a commodity. Paper on its own is worth very little. Add a nice design that’s relevant to an important event in peoples’ lives and it’s worth more on the supermarket shelf. Have that design created by a popular illustrator, designer or innovative brand and the card is worth more again. Present a selection from wonderful designer makers using beautiful print techniques and thoughtful or humorous messages in a pleasant retail environment like so many beautiful card shops and the card grows in value to the consumer seeking an authentic retail experience.
For publishers it’s the same, you have to render an authentic experience of your company at trade shows, in your imagery, in your brochure, on your website that is true to your nature and reflects your core values.
So where does this leave you and your business? Firstly, you need to be aware that authenticity has become the new consumer sensibility and there are three basic rules to this:
1. Don't say you are authentic unless you really are authentic.
2. It's easier to be authentic if you don't say you are authentic.
3. If you say you're authentic you had better be authentic.
To thrive in this new economy you need to understand what your business is and make sure it is in line with what you are telling your customers it is. The extends to your communications, point of sale and how you interact with your customers. Training your team in your company’s heritage and values is also key. Pay attention to your company culture from the beginning as it’s harder to change later as you grow.
Finally, as a leader in your business you also have to know yourself. You have to know the real reasons you work in your business and it shouldn’t just be for the money. Money and success are by products of serving customers well and making them happy by giving them an authentic experience.
This article is based on the book and TED talk on ‘Authenticity: What Consumers Want’ by writer and business consultant, Joseph Pine. You can watch it at www.ted.com.
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