commodities, goods, services, experiences

Emerging Economy Paradigms

In the past, people have tended to view entertainment and enjoyment as a separate experience from their daily work life and education. However, it is increasingly changing to where people integrate and expect pleasure and enjoyment in their daily lives, work or otherwise [Tomico et al., 2006b]. Moments of entertainment and  experience  are  no  longer  seen  as  extraordinary  events  but  part  of  our  everyday experience [Green, 2003] and can be bought and sold like other goods or services. In other words an Experience Economy [Pine, 1995].

Furthermore,  as  most  physical  needs  have  been  satisfied,  people  are  turning their attention more to satisfying emotional, aesthetic, sensory and even spiritual needs. There is a transition to a Dream Society [Jensen, 1999], where consumers follow their feelings and emotions to guide the decision making process.  They do this in order to buy products or services, which evoke pleasant feelings and allow for the projection of their personalities. This move to the Dream Society is based on three facts [Ardèvol, 2006]:

• The change acceleration results from an information society, which spreads ideas in a much faster way and inspires other new ideas more rapidly.
• The economy transition in rich countries to an experience economy, where the immaterial consumption is growing much faster than material consumption because the material part has been saturated or fulfilled on a wide scale.
• Technological development, implying that most everything can be produced, increased the importance of emotions in product choices.

In  a  broader  social  context,  the  Dream  Society  is  embedded  in  what  is  called the Model of the Society Logics, which relates it to the Industrial logic and the emerging Creative Man logic. It is a new social playground, where feelings and experimentation lead to an emotional consumption. [Morgensen, 2006]

Experience economy, the fourth economic offering

Joseph Pine [Pine, 1995] describes a new economy where experiences are a fourth economic offering, as distinct from services as services are from goods. When a  person buys a service, he purchases a set of intangible activities carried out on his  behalf. But when he buys an experience, he pays to spend time enjoying a series of memorable events that a company stages to engage him in a personal way. 

 The  economic  offerings  described  by  Pine  [Pine,  1995]  are  the   following:  Commodities,  Goods,  Services  and  Experiences.  Commodities  are materials extracted from the natural world (animal, mineral, vegetable) and by  definition fungible. Goods are standardized tangible items that use commodities as  raw  materials.  Services  are  intangible  activities  customized  to  the  individual request of known clients. Service providers use goods to perform operations.