The Experience Economy & Transformation Businesses

20 Aug 2010 – Jennifer Biringer

The very idea of an experience economy is likely not foreign to locals here in the Bay Area (home to pleasure seekers of all types). I mean to explore this notion in a broader sense however – that is as the next step in our evolution starting with an agrarian economy to the industrial model to what is largely now a service economy in many developed countries towards an economy focused more on the consumer experience. This has some exciting implications for the sustainability agenda.

Joseph Pine and James Gilmore set out the idea of the experience economy in 1999, seeing the limitations in conversations around the capitalism – communism continuum which focused on resource scarcity. Instead, they posited, businesses are now becoming geared towards delivering value that is greater than all the inputs (think educational or healthcare outcomes at least in an idealized sense).

Some say that experience businesses are defined by the feeling customers get by engaging with them and go a step further to say that transformation businesses are focused on the benefit customers actually receive. Taking it to the sustainability realm, I wonder, is it fair to say that the success of future businesses will be judged on the degree that they satisfy societal outcomes? And are businesses currently satisfying societal outcomes?

I would have to offer a resounding no. While many individuals get their immediate needs met, most are not getting these needs met in the sense that the value they derive is sustainable. And there is a serious issue of lack of accessibility to basic needs for a great many.

Still, there are some intriguing examples of transformation businesses here in the Bay Area leading the way to provide greater access to sustainable outcomes. Cityscape Farms is a new start up aimed at increasing access to healthy, sustainable and local food by farming on rooftops – even better its model is geared towards raising fish who fertilize food grown in the same space. My Farm SF is a bold attempt at linking in different ways neighbors with land in the ultimate localized model – participating either by allowing free land to be farmed or by buying into a food share (the business is on hold but the model is still intriguing!). Yet another example from the food space is FarmsReach, which is in the beta stages as an eBay for the agricultural world by solving one of the major challenges in the current distribution of sustainable food (linking producers and retailers).

I’m eager to continue compiling a list of transformation businesses and would welcome your additions!