Developed by Miyoung Jeong, PhD Ann Marie Fiore, PhD Haemoon Oh, PhD Linda Niehm, PhD Cheryl Hausafus, PhD Apparel, Educational Studies, & Hospitality Management Iowa State University Acknowledgment – We thank the Southern Rural Development Center for funding this project. We also thank Steve Mickelson, Extension Specialist at Iowa State University, for his review of the project and Keila Tyner and Calista J. Yoo for their creative and technical assistance.

2 Table of Contents Lesson 1. An Introduction to Experience Economy Strategies Lesson 2. Experience Economy Strategies Adding Value to Rural Businesses Lesson 3. Aligning Experience Economy Strategies of the Business and E-commerce Website Lesson 4. Assessing Experience Economy Strategies of the Business Lesson 5. Assessing Experience Economy Strategies of the E-commerce Website

3 Lesson 1.1: A Progression of Economic Value from Commodities to Experience Lesson 1.2: Defining the Four Experiences (4Es)

4 Successful small businesses focus on Vision Innovation Opportunity recognition Passion for change Customer-focused strategy –Exceptional staffing –Extraordinary service

5 Customers want value High quality products Superior customer service Positive, engaging, memorable experiences –Experiential value

6 Competitive advantages of experiential value Satisfies customers fully Builds loyal customers Increases customers willingness to pay more Encourages positive word-of-mouth Recruits new customers Enhances business image Differentiates from competitors

7 Added experiential value for customers: An example of Starbucks Interior Design –Rich warm colors –Contemporary furnishings –Stylized graphics Music Media Bars –Music heard in store –Recommendations of music –CD burned from selected music of vast library

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9 Pine & Gilmores Progression of Value Sources of economic growth in the U.S. have progressed from commodities to goods and services, and now to experiences (Pine and Gilmore, 1999)

10 Pine & Gilmores Progression of Value The Experience Economy reflects expansion of customer expectations to include positive experiences In addition to quality goods and superior customer service, businesses must add value in new ways to differentiate themselves

11 Progression of Value : An Example of Corn

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13 Four experiences based on level and form of customers involvement

14 Definition of 4Es: Educational Experiences Increase the customer's skills and enhance his/her knowledge through active participation in the experience Accommodation / B&B RestaurantRetailRural tourism Applications for four different businesses

15 Definition of 4Es: Esthetic Experiences Entail customer enjoyment of an enriched, unique physical design. The customer enjoys passively appreciating or just being in a setting of the business. Accommodation / B&B RestaurantRetailRural tourism Applications for four different businesses

16 Definition of 4Es: Escapist Experiences Require that the customer actively participate in the events of a real or virtual environment. The customer shapes or contributes to the experience, which offers the customer a way of taking on a new persona. Accommodation / B&B RestaurantRetailRural tourism Applications for four different businesses

17 Definition of 4Es: Entertainment Experiences Entail watching the activities and/or performances of others. The customer is not actively involved in the creation of the entertainment, but the mind is actively engaged during appreciation of the event Applications for four different businesses Accommodation / B&B RestaurantRetailRural tourism

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19 Educational Experience: Accommodation/B&B A B&B provides seasonal educational experiences about traditional Minnesota farm life, such as bread baking in an outdoor oven, making homemade applesauce, and berry picking. Round Barn Farm Red Wing, MN m/attractions.htm

20 Educational Experience: Restaurant A local restaurant offers hands-on cooking classes, plus special events such as wine tasting, entertaining, and birthday parties. The Chopping Block Chicago, IL k.net/

21 Educational Experience: Retail A fabric store sells traditional/contemporary quilting fabric and supplies and teaches quilting classes to customers. Cow Country Fabrics and Quilts Dorchester, WI cs.com/

22 Educational Experience: Rural Tourism A Dutch tourism attraction retail store and factory provides an opportunity for patrons to observe traditional wooden shoe carving. Visitor also can talk with artisans as they create wooden shoes and delftware in the old world tradition. Dutch Village Holland, MI vities.html

23 Esthetic Experience: Accommodation/B&B Landscape and interior design of this B&B offer an esthetic experience. Beautiful B&B Yarra Valley, Australia ntals.net/detailed/1157.html

24 Esthetic Experience: Restaurant Art-lined walls and accent lighting create an esthetic experience in this otherwise understated restaurant. Café Des Amis Breaux Bridge LA eviews/Overview.aspx?RefI D=1900

25 Esthetic Experience: Retail The picture-perfect exterior along with beautiful products displayed inside offer an esthetic experience. Belgique Pâtisserie & Chocolatier Kent, CT eviews/Overview.aspx?RefI D=491

26 Esthetic Experience: Rural Tourism Brilliant rivers and mountains of orange pumpkins of this festival offer an esthetic experience. Pumpkin Festival Half Moon Bay, CA agritourism/agritour.html

27 Escapist Experience: Accommodation/B&B Murder mystery dinners held in a B&B provide an evening of mystery and intrigue. Each guest plays a character and attempts to solve the murder while being served a delicious gourmet meal. Maple Hill Manor, KY murdermystery.html

28 Escapist Experience: Restaurant A family-run restaurant offers a wide variety of activities for its customers, which make them feel like rangers by bottle-feeding cows. Flying B Ranch, SD %20Feeding.jpg

29 Escapist Experience: Retail Bike shop customers can try out demo mountain bikes on the mountain trail, thus, escaping from their routine life. m/Recent_Photos/Bike_Rid e_Photos/Bob_Mountain_Bi king.JPG

30 Escapist Experience: Rural Tourism A small farmhouse offers a mini maze for little kids to wander through alongside a cornfield maze adventure for adults. Scotts Zellwood, FL. weetcorn.com/cornmaze.ht m

31 Entertainment Experience: Accommodation/B&B A B&B owner, dressed in colonial garb, shares recipes, cooking secrets, and narratives from the 18th century. Elias Child House B&B, Woodstock, CT eliaschild/specials.html

32 Entertainment Experience: Restaurant Servers entertain customers by singing for their supper at a restaurant. Flying T Chuckwagon Supper & Show Rapid City, SD.

33 Entertainment Experience: Retail A boutique pet store offers a unique private birthday party for a pet, with the stores owner providing birthday cake and entertaining music. Metropawlis Milwaukee, WI mhttp:// m/

34 Entertainment Experience: Rural Tourism Spectators cheer on their favorite pig at the World-Class Pig Races held on a farm. Old MacDonalds Farm, SD ckhills.com/Info/pr0402.jpg