How can the rise of the transformation economy be adapted within fashion r e t a i l e r â€™s strategies to improve the way experiences are delivered to millennials?
The desire for experiences that offer personal transformation, self-actualisation and emotional connection over experiences that offer esteem and â€˜been there, done thatâ€™ moments is the future of the global economy, as consumers start to seek to progress the transition of the experience economy to the transformation economy. Subsequently, markets are starting to transition towards transformative experiences, yet there is no research undertaken on how fashion retailers can transition their experiences into the new emerging economy. This dissertation aims to determine how fashion retailers can engage experiences within the developing transformation economy. This is achieved through exploring the transition within economic values, identifying key consumers, analysing the current transformation economy and case studies in addition to future strategies. Research was conducted to gage a further understanding of the emerging economy and to identify the key consumer in seeking transformative experience. Millennial consumers opinions were collated using a focus group regarding their values and needs in addition to their identification with the transformation economy. Furthermore, a semi-structured email with the author of the economic value theory, Joseph Pine, provided insight into the future of the transformation economy within fashion retailers. The study concluded that full evolution from the experience economy to the transformation economy is not one which will occur for a period of time. However, the study identified that the demand for such experiences from the millennial consumer indicates its significantly important that fashion retailers adopt methods to offer transformation. A key recommended for achieving a successful transformative experience is for fashion retailers to seek to improve their instore experience by offering consumers a sensory safe room within their demanding store environments.
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This section is to thank the following people, who, without their help, guidance and support, this dissertation would not have been possible:
Beth White Dissertation Tutor - for her constant support, guidance and confidence in myself from the very beginning. It wouldn’t have been possible without her Alison Rapsey Course Director of BA (Hons) Fashion Business and Promotion and lecturer at Birmingham City University Joseph Pine Author of ‘The Experience Economy’ – For his constant involvement in strengthening my body of research offering new insights and further knowledge for the dissertation Focus Group All participants for their personal opinions to help further research for this dissertation
Ta b l e o f C o n t e n t s Abstract
List of Figures
List of Tables
Chapter 1 What is the economic value theory?
Current Economy: Experience
Future Economy: Transformation
Chapter 2 Technology Secluded
The Lifelong Learner Tribe
Ta b l e o f C o n t e n t s c o n t . Chapter 3 Health and Wellness
Travel and Tourism
Chapter 4 Headspace
Nike+ Run Club
Ta b l e o f C o n t e n t s c o n t . Conclusion
List of References
List of Picture References
List of Figures
Figure 1: Lady emerged in lights Figure 2: Secluded hotel Figure 3: Lady sat in silence Figure 4: Cultural boat trip Figure 5: Cultural market Figure 6: Peaceful location Figure 7: Light exhibition Figure 8: Economic value theory Figure 9: Economic value theory Figure 10: Maslowâ€™s Hierarchy of Needs Figure 11: Experience art exhibition Figure 12: Reflection of a woman Figure 13: Lady on mobile phone Figure 14: Lady on retreat Figure 15: Lady on retreat Figure 16: Lady practising yoga Figure 17: Yoga retreat abroad Figure 18: Lady on laptop Figure 19: Workshop Figure 20: Cultural buildings Figure 21: Art exhibition Figure 22: Millennial running Figure 23: Yoga classroom Figure 24: Lady running Figure 25: Lady running Figure 26: Women boxing Figure 27: Exhibition installation Figure 28: Art Exhibition Figure 29: Art within a retail environment Figure 30: Exhibition installation Figure 31: Cultural landscape Figure 32: Cultural building Figure 33: Cultural market Figure 34: Cultural building Figure 35: Ladies on a yoga retreat Figure 36: Headspace Instagram Figure 37: Headspace Instagram Figure 38: Headspace logo
i iv v ix x xiv xv 3 6 7 9 14 15 18 18 18 18 19 19 19 19 22 26 26 26 26 27 27 27 27 30 30 30 30 31 35 35 35
List of Figures cont.
Figure 39: Headspace Instagram Figure 40: Headspace Instagram Figure 41: Headspace Instagram Figure 42: Nike+ Run Club Instagram Figure 43: Nike+ Run Club Instagram Figure 44: Nike+ Run Club Instagram Figure 45: Nike+ Run Club logo Figure 46: Nike+ Run Club Instagram Figure 47: Nike+ Run Club Instagram Figure 48: Headspace app Figure 49: Nike+ Run Club app Figure 50: Man running Figure 51: Lady within a sensory space Figure 52: Light sensory exhibition Figure 53: Light sensory exhibition Figure 54: VR headset Figure 55: Selfridges body image Figure 56: Hotel room with gym inside Figure 57: Light sensory exhibition Figure 58: Safe Space
35 35 35 38 38 38 38 38 38 39 39 42 46 46 46 46 47 47 50 53
L i s t o f Ta b l e s Table 1: Data Analysis Table 2: Headspace SWOT Analysis Table 3: Nike+ Run Club SWOT Analysis
xx 36 37
G l o s s a r y o f Te r m s
LS:N Life Style Network, a trend forecasting agency WGSN Worth Global Style Network, a trend forecasting agency Transformation Economy Final phase of economic values Terminal Value Goals that individuals work towards and view as the most desirable Millennials (Generation Y) A demographic consisting of individuals between the age of 19 to 36 Self-actualisation A state in which people are at their very best Maslow Hierarchy of Needs Motivational theory that comprises a five-tier model of human needs
At present, there is currently no research undertaken around how fashion retailers can adopt experiences within the emerging transformation economy, despite the rise in consumers seeking to undergo experiences that offer a sense of self-fulfilment and selfactualisation. Therefore, this dissertation seeks to explore how fashion retailers can engage experiences with consumers within the developing transformation economy – the customisation of the current experience economy, where experiences that offer esteem are shifting towards experiences that offer consumers the chance of personal transformation. The study will offer a significant exploration into Joseph Pine and James Gilmores economic value theory, exploring why the global economy continues to progress at the pace of consumers, in particular focusing upon the progression from the experience economy to the transformation economy. The researcher will then analyse the millennial generation’s characteristics and values, in particular the ‘The Lifelong Leaners’ establishing their significance within the study. LS:N identify millennials a key consumer in moving the pace of the economy towards transformation as they seek experiences that offer selfactualisation -travel (81%) and fitness (55%). The study will then move on to investigate markets that already identify within the transformation economy. Case studies of such markets will be analysed to the extent their experiences are within the transformation economy. Furthermore, the study will then go on to explore strategies in which fashion retailers can adopt to gage transformative experiences with their millennial consumers.
Aim - The overall aim of this study is to explore the rise of the transformation economy, identifying what consumers are pushing for self-actualisation and how fashion retailers can engage transformative experiences in the future. Objectives To explore the economic value theory, particularly the revolution from experience to transformation To identify and analyse Millennials and ‘The Lifelong Leaners’ To investigate current markets within the transformation economy To highlight and analyse case studies of brands which offer transformative experiences To evaluate methods fashion retailers can adopt in offering an experience within the transformation economy xvi
Methodology: Primary Research
To produce a diverse range of personal views and to gain an understanding of the research topic, the researcher used a variety of primary and secondary research methods throughout the dissertation.
Focus Group (See appendices 1)
Semi-structured appendices 2)
A focus group was undertaken by the researcher in order to gage a wider understanding of the millennial consumer. Discussion topics included values and needs, what they perceive a good/ bad experience, their interest within transformative experiences, in addition to identification with the LS:N tribe, The Lifelong Learners. The focus group was held in Birmingham City University with four female fashion students between the ages of 20 to 27. This allowed the researcher to gage an insight into a range of millennials opinions based upon different stages of life. The group received a briefing beforehand of what the focus group would entail, including an introduction to the topic and a preview of the LSN tribe, ‘The Lifelong Leaners’. All participants were assured their identity would remain anonymous throughout. A facilitator was present and the discussion was recorded for transcribing purposes.
The researcher undertook a semi structured interview within the form of an email with Joseph Pine – Co-author of ‘The Experience Economy’ – in order to gain an understanding of the topic, his opinions upon the future of the transformation economy and how fashion retailers can engage experiences in addition to further readings and suggestions.
A weakness highlighted within this approach was the limitation in engaging opinions from all participants as certain individuals voiced greater opinions than others. This limited the scope of the research, which could lead to bias outcomes. Furthermore, the utilising of female only students limited the scope of opinion for different genders, race and professions, which ultimately could further lead to a bias outcome. However, the focus group gained valuable research to contribute for the discussion. xvii
A weakness identified by the researcher of using emails as a way of communication with industry experts was the constraint in replies over the dissertation period. Several attempts were made with other experts and no responses led to limitation in gaining opportunity for valuable findings. Furthermore, the lack of opportunity to engage an observation of Pines body language, tone or hesitation led the researcher questioning whether the information received was reliable and trustworthy. However, the interviews with Joseph Pine provided invaluable information that the researcher would not have otherwise gained.
Methodology: Secondary Research
LS:N’s market trend reports including ‘Experience 2020’ and ‘The E-motional Economy’ provided the researcher insight into current and future market trends to support the discussion
Skift’s ‘Transformative Travel’ and ‘Traveller Engagement’ reports provided insight into how consumers are shaping the transformative travel and tourism market
WGSN’s ‘Art and Retail: Refining the experience economy’ market report provided information upon current manifestation of the transformation economy Passport’s ‘Experience More’ market report gave the researcher an insight into the future transformation economy
Books The Experience Economy – James Gilmore/ Joseph Pine – 1st and 2nd edition provided original theory into the progression of economic values, aiding the dissertation topic of the transition towards the transformation economy
The Financial Time’s ‘Millennials savings goals’ report gave an insight into how millennials are shaping the transformation economy by providing their financial goals and values
Limitations A weakness identified by the researcher is the reliability of the sources used. Although the researcher used studies undertaken by the secondary sources, the sample size used to generate the research may have been small and limits the researcher in gaging a true perception of all opinions. However, secondary research provided the researcher with current and future trends within the transformative economy.
Methodology: Data Analysis
As the data collected was mostly qualitative, a code was created to analyse the results. Table 1 identifies the coding use to summarise main themes and meanings from the focus group and semi-structured interview.
Key abbreviations: Focus Group (FG) Interviews (I)
Chapter One This chapter will explore in-depth the economic value theory, identifying why the economy evolves over time. It will focus on the current economic offering (experience) and the future economic offering (transformation).
1.1 What is the economic value theory?
The economic value theory represents the fundamental shift within the global economy as commoditisation and customisation occurs in response to consumer’s needs, values and pricing demands. The theory, represented by James Gilmore and Joseph Pine, highlights five economic offers – commodities, goods, services, experiences and transformation (Gilmore. Pine, 1998) (Gilmore. Pine, 2013). The theory highlights the progression of economic values, which transpire from low value tangible goods (commodities) to high value intangible experiences (transformation), as identified in figure 1. The progression occurs when a previous value becomes standardised (raw material) and customised to the following value, in order to increase the growth of GDP and create jobs within the economy (Managing Research Library, Unknown). Pine identifies that the growing economy moves at the pace of the consumers as they constantly search for the next best thing. He highlights price, technology and quality as factors that have affected consumers decisions in progressing the economy to the next economic value (Strategic Horizons LLP, 2011).
The key issue with this theory is reliability as it’s the only theory to directly identify the fundamental economic values. However, other theories identify an indivertible link which supports Pine and Gilmores economic value theory. These theories include Aristotle’s economic theory – “The purpose of economic action is to use things that are necessary for life (i.e., survival) and for the Good Life (i.e., flourishing). The Good Life is the moral life of virtue through which human beings attain happiness” (Younkins, Unknown) – and James Wallmans Stuffication theory - “we find those in experiences instead of experientialism” (Wallman, 2013: xxvii) – in which both theories support consumers moving the pace of the economy. The identification of the indirect theories offers confidence that the theory identified by Pine and Gilmore is reliable. Furthermore, the economic offerings highlighted within the theory have/are revolutionising which suggests further reliability.
1.2 Current Economy: Experience
The emerging experience economy, as identified by Pine/Gilmore and Wallman, is identified as the current economic offering within the global economy, as consumers seek experiences that are “inherently personal, existing only in the mind of an individual, who has been engaged on an emotional, physical, intellectual, or even spiritual level” (Gilmore. Pine, 1998: 99), see figure 9. Pine and Gilmore identify within their theory that an experience only occurs when services become commoditised, in order to engage individual consumers in a way that creates memorable events. However, the experience can only be classed as an ‘experience’, if the business charges admission fees for the experience (Gilmore. Pine, 1998). Barclaycard recognise that the shift from service to experience has evolved within the current market, by highlighting an increase in spending on services that offer consumers memorable experiences. Their ‘End-of-year’ report shows this transition as it identifies the experience economy as a ‘clear winner’ as spending increases in pubs (12.2%) and entertainment (10.2%) in contrast to clothing (1.4%) and households (0.4%) (Townshead, 2018).
The figures could suggest that consumers values are changing from materialism to experiences that offer memorable and personal aspects, as the figures identify a large difference between spending upon goods/services over experiences. This is shown through LS:N’s ‘Experience 2020’ report which suggests “consumers now value experience over products and want memorable moments” (Szymanska et all., 2017: 1). Eventbrite suggests the shift towards the current experience economy is driven by the millennial consumer. Their ‘Millennials’ report identifies this by stating that three in four favour desirable experiences over purchasing goods (Eventbrite, 2017). The focus group undertaken by the researcher with millennials further identifies that they would expect an experience from a retailer. (See appendices 1) As Pine and Gilmore suggest that consumer moves the pace of the economy, the figures could suggest that millennials are a key demographic in moving the service economy to the experience economy. Furthermore, Eventbrite also identify that 72% of millennials are likely to increase their spending on experiences over the next year (Eventbrite, 2017). Consequently, this could show that the experience economy is due significant rise as the current economic value, as consumer are willing to continue to spend upon desired, high valuable experiences.
1 . 3 F u t u r e E c o n o m y : Tr a n s f o r m a t i o n
The fifth, final and future economic value, as identified within Pine and Gilmores updated economic value theory (2013) is transformation. The theory highlights the future of the experience economy should yield transformations as “individual partaking in the experience often wants something more lasting than a memory, something beyond what any good, service or experience alone can offer” (Gilmore. Pine, 2013: 39). Skift highlights the shift from the current experience economy to the future of the transformation economy, in terms of Maslow’s Hierarchy of Needs, as experiences that offer esteem are shifting towards transformations that offer self-actualisation and personal transformation (Skift, 2018) (See figure 1). This identifiably links with Pine and Gilmores theory of offering memorable experiences to experiences that yield transformation. Furthermore, it also identifies with Aristotle’s economic theory that suggests consumers are seeking to obtain happiness. However, Pine and Gilmores theory suggests, much like the experience economy, businesses cannot offer a transformative experience if it does not charge a fee for undergoing the transformation (Gilmore. Pine, 2013). Consequently, Pine identifies during an interview with the researcher that, “We have a long way to go, for one is only in the transformation business economically if one charges for the demonstrated outcomes that customers achieve, and few do that. So, there’s a great deal more maturity required. It’s also true that consumers are not at all used to paying for outcomes (that’s a little less true in B2B industries), so it will take a while to get that going” (See appendices 2).
This statement suggests that the transformation economy has a while to progress in transitioning from the experience economy, as both businesses and consumers are reluctant in paying/charging a fee for a transformative experience. To further add to this, the focus group undertaken by the researcher identified that 75% of participants hadn’t heard of the transformation economy (See appendices 1). Nevertheless, Passport predicts that the transformation economy will undergo full transition from experiences by 2030. Their ‘Experience More’ report states that by 2030, the global population will strive towards transformative experiences as they obtain a fundamental shift in values towards experiences that bring happiness and wellbeing (Passport, 2017). The report suggests that consumers fundamentally shifting values will move the pace of the experience economy to the transformation economy as they strive from esteem experiences to happiness. However, the report identifies that this will occur by 2030, which could suggest that not all consumers are ready to gain transformative experiences. Pine furthers this by stating within a recent interview with Skift that “Well, the world isn’t ready for it yet. It is a very intimidating word, but it is in fact what people are just naturally increasingly looking for, because people are always looking for things that affect them in some new way” (Pine, 2017: p11).
Upon evaluation, a clear finding identified within this chapter is consumers are ultimately driving the evolution of economic values. This is particularly identified within the shift from service to experience as millennials seek to obtain memorable experiences over goods/ services. However, it has been identified that the shift within values from experience (esteem) to transformation (self-actualisation) is not one that will fully transition until consumers and businesses value transformative experiences and pay/charge for the outcome. Having explored the economic value theory, the study will now move on to analyse the millennial generation.
C h a p t e r Tw o This chapter will determine millennials as a key generation for the transformation economy. It will analyse millennials key characteristics and values, identifying â€˜The Lifelong Learnerâ€™ tribe as a key consumer group.
Millennial’s (Generation Y), the phenomenal generation often referred to as generation ‘me me me’, are identified by Vision Critical as the largest consumer demographic in the world, consisting of 75.7 million 19 to 36-year-olds in the US (Kleinschmit, Unknown).
2 . 1 Te c h n o l o g y S e c l u d e d
Technology savvy is a fundamental characteristic of the millennial generation. Pew Research identify this trait by recognising millennials as the most tech savvy generation in history, as 92% of Generation Y own a smartphone (Jiang, 2018). The study identifies that the vast majority utilise social media on their smartphones (85%), in which they seek to check 150 times a day, nearly double the average (80) (Brandon, 2017). It could be suggested that millennials mostly utilise technology as they are brought up within a technology integrated world. However, the figures suggest that this has led to millennials being obsessed with their smartphones, as they seek to utilise constantly in order to check social media.
One identified reason why millennials are constantly seeking to overuse their smartphones is identified as the â€˜fear of missing outâ€™ (fomo), as they are recognised as the loneliest generation in history, another key characteristic of Generation Y (Tracy, 2018). The Guardian identify that 23-31% of millennials state they experience feeling lonely, in which they perceive undergoing financial instability in order to reduce this (Davis, 2018). Credit Karma shows this through identifying that 36% of millennials would rather spend more than they earn, in order to keep with friends and diminish loneliness (Devaney, 2018). The report suggests that millennials are willing to obtain friendships by undertaking experiences with them as they seek this brings happiness, at risk of their own financial wellbeing.
2.2 Self-Actualisation Seekers
Happiness pursuers is identified as another fundamental characteristic of the millennial generation. Vision Critical identify this trait of seeking happiness stems from millennials key ‘terminal’ values which include happiness, passion and diversity (Kleinschmit, Unknown). To further support this, the focus group undertaken with millennials by the researcher, identified 50% stated happiness as a key value also (See appendices 1). Eventbrite identifies that millennials are undertaking experiences, another characteristic of Generation Y, in order to achieve the happiness that they seek. The report states “for this group, happiness isn’t as focused on possessions or career status. Living a meaningful, happy life is about creating, sharing and capturing memories earned through experiences that span the spectrum of life opportunities” (Eventbrite, 2014: 4). LS:N’s, ‘Money Market: Millennials’ report identifies these experience that millennials favour to include travel (81%) and fitness (55%) over prioritising financial savings, in order to seek the happiness they desire (McGregor. Houston, 2018).
The identification of undertaking experiences including fitness and travel, are those identified within the transformation economy (chapter 3) which suggests millennials are opting for transformative experiences over future possessions in order to receive the happiness they desire. This could suggest that millennials are the key generation in shifting the experience economy to the transformation as they are seeking experiences that shift towards the top of Maslow’s Hierarchy of Needs (selfactualisation), as identified in chapter 1. However, as millennials are identified as shunning financial savings (second tier – safety), moving between the hierarchy in a unidirectional way, it could be suggested that full self-actualisation and happiness will be reached within the future, as they can only reach the top if all other tiers are met. Therefore, this links back to the chapter 1, when identifying that the transformation economy is a future economic value. .
2 . 3 T h e L i f e l o n g L e a r n e r Tr i b e
“This tribe of high-net-worth high achievers are more interested in spending their money on self-enriching experiences than on gratuitous displays of wealth, and see little separation between work, learning and leisure” (Maxwell. Smith, 2016: 1).
The researcher has highlighted ‘The Lifelong Learner’ tribe, as identified by LS:N, as a key millennial consumer group contributing to the emerging transformation economy. LS:N identify members of the tribe to be ‘high net worth, high achieving’ individuals, in which the majority identify themselves to live within a high-income bracket household (Maxwell. Smith, 2016). The emphasis of the tribe contributing high incomes could suggest that the tribe resonates with an early generation that has built up this high net worth over a period of time. Furthermore, WGSN identifies their tribe, ‘Engaged Realistic’, as high proportioned, high earning early millennials (31-35). This could suggest that ‘The Lifelong Learner’ tribe identifies as early millennials as their characteristics match with WGSN’s tribe (WGSN, 2017).
The focus group undertaken by the researcher with late millennials suggests they would identify with the tribe “when I get a bit older, such as 30+ when I have an income to play with”, further suggesting the Lifelong Learner tribe as members of early millennials (See appendices 1). LS:N identify a fundamental characteristic of the ‘Lifelong Learner’ tribe as seeking of transformative experiences – cultural travel experiences and educational experiences – over the gracious display of wealth through material goods (Maxwell. Smith, 2016). The seeking of experiences that offer a life-changing experience resonates with millennials characteristics, as previously identified. This could suggest that the tribe is driven by millennial consumers. The ‘Global Millennial Report’ supports this suggestion as it identifies that millennials define wealth as something beyond possessions, with 80% prioritising an experience-rich-live (UBS, 2016). This could confirm that the Lifelong Leaner tribe identify with millennials as further research identifies the same characteristics with millennial consumers. Therefore, it could be suggested that ‘The Lifelong Learner’ tribe are a key early millennial consumer for the transformation economy.
Upon evaluation, a clear finding within this chapter identifies millennials as a key consumer driving for the transformation economy. This is identified through millennials desire to overcome loneliness by undertaking transformative experiences that offer happiness. It further identifies the early millennials as a key consumer within the transformation economy, as they contain the characteristic of â€˜high-net-value achieversâ€™, identifying a larger income to spend on experience that they seek over displaying their wealth. This chapter has identified millennials are a key generation for the transformation economy. It will now be necessary to explore sectors that are offering consumers transformative experiences, including Fitness and Travel, as identified by millennials.
Chapter Three This chapter will identify market sectors that offer consumers experiences within the transformative economy, including health and wellness, education and travel.
3 . 1 H e a l t h a n d We l l n e s s
Wellness – state of complete physical, mental and social wellbeing – is identified as a market that offers consumers the chance of a life-changing experience as Pine suggests in an interview with Business of Fashion that “experiences that actually make us fitter and help us achieve our aspiration for health and wellness is where things are shifting” (Pine, 2016: p13). Market researching company, Statista, recognise this shift towards experiences offering consumers fitter lifestyles by identifying a rise within the health and wellness market value. The report identifies a significant value increase in the health and wellness market in the UK from 22.6bn (2013) to 26bn (2018) (Statista, 2018). This rise in market value is shown through LS:N’s ‘Certified Wellness’ report that suggests consumers are driving the shift for brands to offer clear paths to tangible health results (McGregor, 2018). The figures suggest Pines theory of the health and wellness market shifting has started to evolve as the market shows a substantial growth as consumers seek to gain experiences that offer transformative health results, as identified by LS:N.
One way in which health driven consumers are undergoing transformative experiences within the health and wellness market is through utilising health and fitness club memberships. Mintel identify this through an increase within the number of consumers holding a health and fitness membership in the UK, at 5.4 million in 2016 (Mintel, 2016). It could suggest that gyms are a way of offering a successful transformative experience within the transformation economy, as consumers are willing to pay for the experience in return for tangible health benefits. One identified reason as to why the health and wellness market is recognised within the transformation economy is the proven transformation of mental wellness. The NHS identify this through the link between exercise improving anxiety. NHS statistics provide proof that exercise can reduce the risk of depression by one third (NHS, 2018). The statistics provide proof that the health and wellness market ultimately offers experiences within the transformation economy as it offers consumers the chance to have a fitter mind. Furthermore, LSN’s ‘Certified Wealth’ report further identifies proven transformative results from the health and wellness sector as activities within can “equate to longer life expectancy and better quality of life” (McGregor. Smith, 2018: 3).
The phenomenon of consumers fundamentally seeking value in the way they perceive life, as identified within chapter 1, is pushing the alignment between experience and education, as businesses must offer educational experiences to tap into consumer desires. Passport identifies the shift towards experiences that offer educational benefits by identifying a rise in consumers spending upon education services. The ‘Income and Expenditure’ report identifies education as the fastest growing spending category through to 2030, as consumers increase expenditure by 3% upon educational services (Passport, 2018). The increase identified in consumers spending suggests consumers are prioritising educational experiences as they offer consumers the chance of a change in outlook.
However, it could be suggested that the identification of education continuing as the fastest category until 2030, is in alignment with passports previous identification of the transformation economy fully evolving in 2030, (see chapter 1) suggesting that education could play a part in fully revolutionising the transformation economy. One identified way in which retailers are engaging with the demand for educational experiences with consumers is through combination of the art and retail environment. WGSN identify within the ‘Art and Retail’ trend report that brands “seek to differentiate themselves and engage experience-hungry consumers with new art-focused concepts” (WGSN, 2017: 1). This is shown through retailers offering immersive and sensory experiences to engage transformative experiences offering educational content.
3 . 3 Tr a v e l a n d To u r i s m
Consumers are increasingly driven to travel experiences that offer a form of self-actualisation as they identify personal growth as a key goal. This has driven the trend for travel and tourism to shift into the transformation economy from the experience economy (Skift, 2018). International Luxury Hotel Association identify a rise from this drive from consumers for a personal growth experience through travel and tourism. The report identifies the luxury travel market is to generate $1.54bn by 2020, as Skift identifies that specifically luxury travellers take personal growth, culture and meaning from an experience as a priority (Asis, 2018) (Skift, 2018). The figures identify that luxury consumers are perceiving to gain the intangible experience through the luxury travel market. This could suggest that only consumers that have a high disposable income are the ones driving the travel and tourism market into the transformation economy from experience.
However British Holidaymakers (trend researchers), identify that one in six consumers from all age demographics opt to travel alone for reasoningâ€™s including freedom, discovering themselves and self-actualisation, as the rise of solo travel increases by 150% over the last 7 years (Calder, 2018). The benefits identified from solo travel link with those of Pine and Gilmores transformation theory which suggests travel experiences offer life changing opportunities. However, the identification of one in six consumers from all demographics suggests that itâ€™s not only luxury consumers that seek transformative travel experiences as this includes Generation Z, the youngest and least experienced financial demographic of all.
Upon evaluation, a clear finding identified within this chapter is the transition in consumer behaviour is driving the increase in market values that offer the chance of transformation. Although it could be suggested that the markets identified have always offered the chance of self-actualisation, the rise within the markets suggests consumers desire these experiences now more than ever. It could be suggested that it can be achieved through educational, cultural and mental wellbeing experiences. This chapter has demonstrated that the transformation economy has started to manifest within different market sectors. It is now necessary to devoir more into retailers who are offering transformative experiences to their consumers, specifically focusing on how and why.
Chapter Four This chapter will identify key retailers who offer experiences within the transformation economy. It will establish and compare their experiences, the motives behind the offering and the extent of their success on the market.
Mission â€“ To improve the health and wellness of the world (Headspace, Unknown) Headspace, a business set up with one goal of teaching meditation and mindfulness to as many people as possible, was founded in 2010 as an events company. However, the demand from consumers to take home what they had learnt, led to the launch of the Headspace app in 2012, allowing all consumers the chance to improve their health and wellness through learning the essentials of meditation and mindfulness (Headspace, Unknown).
4.2 Nike+ Run Club
Mission â€“ Bring inspiration and innovation to every athlete in the world (Nike, Unknown) Nike+ Run Club was set up by fitness brand Nike as part of their Nike Plus programme, with the goal of encouraging a community of athletes/runners to run further and faster than ever before. The club launched as an app in 2016, offering consumers the chance to improve both their health and fitness by providing the premier motivation-guidance-support to do so (Nike, Unknown) (Sorman-Nilsson, 2016).
As consumers fundamentally shift their values towards experiences that offer happiness and self-actualisation, as previously identified within chapter 1 and 2, Headspace and Nike+ Run Club are brands identified that offer consumers a transformative experience Headspace, identified as a â€˜gym membership for the mindâ€™, offers consumers the chance of transforming their mental wellbeing, proposing a happier and healthier life, through undertaking mindful meditation offered upon the app (Anxiety UK, Unknown). The app offers consumers the opportunity to train the mind through personalised meditation, guided tutors and 100â€™s of activities which offer consumer positive impacts on stress, self-compassion, focus, mood and anxiety (Headspace, Unknown). In comparison to Headspace, Nike+ Run Club offers consumers the chance of transforming both their mental wellbeing and physical health, through motivating consumers to participate in running. The app offers consumers opportunities to stay motivated by offering personalised coaching, competitive runs against fellow friends/runners within the Nike community and the option to track progress, which allows them to become a better runner/ athlete (Nike, Unknown). Tech Crunch (market researchers) identify the extent of the success of the app offered by Headspace by identifying the apps current market position. The report identifies that Headspace, number 2 health and wellness app (Apple App Store) is currently valued at an estimated $320 million, with 1 million of the 31 million consumers contributing to this value through subscription (Lunden. Perez, 2018).
Conversely, Nike identify the extent of the success of its Nike+ Run Club by identifying the current usage by consumers of the app. The report identifies that Nike+ Run Club, number 31 health and wellness app (Apple App Store) has currently accumulated over 450 million hours of running logged since the launch in 2016 (Nike, Unknown). From all the data and statistics, it could be suggested that both Headspace and Nike offer an experience within the transformation economy as they both offer consumers the chance of a life-changing experiences by improving mental and physical wellbeing. However, for both brands, the extent of being within the transformation economy is limited, as previously identified within Pine and Gilmores theory in chapter 1, that businesses are only in the transformation economy if they offer consumers a transformative experience at a cost. Although Headspace offers consumers the subscription option, the extent of consumers undertaking this option is small in relative to the number of consumers utilising the app and Nike do not offer a fee for their transformative experience at all. Therefore, it could be suggested that the transformation economy has a way to go in fully evolving as businesses and consumers are reluctant in paying/charging for a transformative experience.
On evaluation, a clear finding from the case studies suggests consumers are utilising apps in order to obtain transformative experiences, a way in which fashion retailers can adopt. However, the research identifies both brands offering a free transformative experience, suggesting that such experiences are not fully within the transformation economy as both consumers and retailers are hesitant to set/pay fees. Having identified key retailers that offer transformative experiences, the study will now focus upon how fashion retailers can engage an experience within the transformation economy in the future.
Chapter Five Although the fashion sector has not been previously identified as offering transformative experiences, this chapter will evaluate what methods fashion retailers can adopt to engage with their consumers within the transformation economy in the future.
5.1 Emotional Emphasis
Emotional connection – “the bundle of subjective feelings that come together to create a bond between two people” (Everyday Health, Unknown: p4) – is an identifiable way of brands engaging transformative experiences with consumers to engage a deeper, fulfilling experience. Claudia Roth, global leader in the transformation economy and founder of Soul Luxury, recognises this importance of gaging an emotional connection with consumers through the use of Emotion Touch Points (ETP’s). Claudia identifies the importance of EPT’s within her ‘Soul Luxury Audit’, which is designed to help brands understand, create and effectively use their emotional currency through the identification of their unique set of EPT’s. She describes EPT’s as a moment when a brand engages with a consumer upon a deeper level – transformation (Soul Luxury, Unknown). The identification from Claudia that brands who create EPT’s are able to engage with consumers upon a deeper level, suggests that it could be important for fashion retailers to utilise this in order to engage a transformative experience. WGSN further this importance of emotional level within their ‘The Vision 2020: Part 1’ report which identifies emotional connections as the cornerstones of the futures (WGSN, 2018). LS:N identify one way in which fashion retailers can engage an emotional connection in order to offer a transformative experience. Their ‘E-motional economy’ report identifies the importance of offering empathic experiences by utilising VR/AR to do so (Maciejowska. Szymanska, 2016).
Ericisson study within the LS:N report ‘Experience 2020’ identities the benefits of utilising VR/AR as a way to engage transformative experiences. The study recognises 7 in 10 early adopters expect AR/VR to change their everyday life with six domains – media, work, education, social interaction, travel and adventure (Szymanska et all., 2017). The figures suggest AR/VR could be a way in which fashion retailers engage an emotionally connected, transformative experience to its consumers, as it suggests the chance to change consumers everyday lives. To support the use of VR/AR as a transformative experience, the focus group undertaken by the researcher revealed 100% stated they would be interested in engaging within an experience using such technology (See appendices 1). Furthermore, LS:N also identify sensory experiences as a way in which fashion retailers can engage an emotional connection in order to offer a transformative experience. LS:N’s ‘Experience 2020’ report identifies that experiences should capture the senses of the consumer, exploring the new sensory perceptions of the five recognised senses – touch, taste, smell, sight and sound – moving beyond the sensory replacement to sensory augmentation or enhancement (Szymanska et all., 2017). The identification of utilising senses as a way of emotionally connecting consumers suggests that fashion brands could enhance their instore retail experience, by offering an experience that rewires the brain into creating a self-fulfilling experience. The focus group undertaken by the researcher supports improving the instore retail experience, as 100% state good customer service as what they would value from the business (See appendices 1).
5 . 2 M e r g e d Tr a n s f o r m a t i o n s
The combination of markets that already identify themselves within the transformation economy, as previously identified within chapter 3 as health and wellness, travel and education, and fashion retailers, could be another way in which consumers engage a transformative experience within a retail environment. The researcher identified the combination of retail and existing transformative markets whilst asking Pine during an interview how he would suggest ways in which the transformation economy could manifest within fashion retailer’s strategies. Pine stated, “Well, frankly, I do not think it makes much sense for fashion retailers to try to offer transformative experiences! I would rather see them spend their efforts actually enhancing the in-store experience” however “you could also think that fashion retailers could offer a “respite” from a busy day “out there in the city”, turning “in here in the store” into something that did enhance stress, mood, etc” (See appendices 2). The response from Pine identifies that he believes that fashion brands cannot solely offer a transformative experience through their own products. However, he identifies that fashion retailers can combine markets in order to offer wellbeing in store through respite and senses, as previously also identified by LS:N.
One identifiable way in which the merging of markets has already started to manifest is through fashion retailer Debenhams, adding the health and wellness market, through instore gyms into the retail environment, to offer consumers the chance of a ‘fitter lifestyle’. Retail Gazette identify Debenhams offering instore gyms, seeking to drive footfall by offering new experience initiatives within their top stores (Jahshan, 2018). The key move by Debenhams allows consumers the chance of enhancing their wellbeing through the use of instore gyms. However, it could be suggested that offering a transformative experience in a retail environment that isn’t to do with the product instore could suggest that the experience is ‘staged’, ultimately suggesting incentives to push stock. The focus group undertaken by the researcher found 100% of participants agreed with this statement, as they believe current fashion retailers wouldn’t offer genuine transformative experiences (See appendices 1).
Upon evaluation, a clear finding within this chapter identifies fashion retailers can offer experiences within the transformation economy, utilising the instore environment through technology, sensory or merged markets. However, the research identifies a combination of markets within the instore environment could be suggested as a way in gaining extra sales and revenue rather than offering genuine experiences. This suggests that fashion retailers need to make sure they offer the correct strategy for its brand and consumers.
The purpose of this study was to examine the rise of the transformation economy and to determine how fashion retailers can adopt methods to engage transformative experiences within the future. One of the significant findings to emerge from the study is that the full evolution from the experience economy to the transformation economy is not one in which will occur for a period of time, particularly highlighted by 2030. The study recognises this through Pine and Gilmores theory which identifies that consumers move the pace of the global economy and as it stands consumers seek to undertake experiences that offer esteem, in which they are significantly rising the value of experiences. However, the study does recognise the transition into the transformation economy, as consumers are starting to shift towards experiences that fulfil happiness and wellbeing, in which transformation experiences seek to offer. Moreover, the study further identifies that businesses are also key in moving the pace of the economy as the study identifies that businesses must charge for the transformative experience in which many are also not yet to establish. The results of this investigation identified millennial as the consumers that are starting to move the pace of the economy towards transformation as the desire for experiences that offer self-fulfilment, happiness and emotional connection has become a popular trend. The study recognises that millennials are tech savvy yet lonely individuals in which they seek to overcome by investing within experiences that offer the happiness that they value in favour of saving for future investments including housing. The results of the study highlight the early millennial consumer tribe, ‘The Lifelong Leaner’ as a key consumer group for retailers engaging transformation experiences, as ‘high-net earners’, they identify a larger disposable income to spend upon experiences that they seek to undertake over displaying wealth. The results of examining the emerging transformation economy identified three key markets that have transitioned from experience to transformation – health and wellness, travel and education. Although the markets identified within the transformation economy have always offered consumers the chance to improve wellbeing, personal growth and outlook, the findings within the study highlight a rise within consumers persistently seeking to spend upon such markets, which suggests that consumers values are shifting. A significant finding within these markets identifies that transformative experiences can be achieved through mental wellbeing, cultural experiences and education, in which fashion retailers can seek to offer.
Analysing case studies of businesses that identify themselves as presenting experiences that offer transformation â€“ Headspace and Nike+ Run Club â€“ provided insights into the transformative experiences that obtain sizable numbers of users seeking to obtain life changing experiences both physically and mentally. The study recognises that both businesses utilise apps to offer such experiences, providing insight for fashion retailers engaging within the transformation economy as one way in which this could be obtained. However, a significant implication identified by both experiences is the providing of a free transformation, which significantly further suggests that although consumers values are shifting, the full transition is a future economy. The following conclusion can be drawn from the study that, although the investigation does not identify the fashion sector within the transformation economy, the desire from millennial consumers makes the market one which needs to adopt such experiences to engage with a key consumer. A significant strategy that the study recognises is the engaging within consumers upon an emotional connection, in which the study recognises the importance of emotional touch points to offer an effective experience. It recognises sensory experiences and VR/AR experiences as methods in which will capture millennials experience desires of personal fulfilment and educational needs, in a way which millennials are familiar with â€“ technology savvy. Moreover, another significant finding from the study was the possibility of fashion retailers combining their retail environment with markets that already identify within the transformation economy. Although the research undertaken suggests that merging markets within the store environment could be used as an ulterior motive in engaging more sales, the research identifies this is a way in which fashion retailers can engage millennial consumers in a way in which they already like to spend their money upon. Overall, the results of this study indicate that in order for fashion retailers to continue to seek connection with their millennial consumer and continue to grow with the global economy, they need to adopt experiences that offer consumers a chance of transformation
Safe Spaces Based upon the results of the study, it is recommended that fashion retailers should improve their instore experience by offering a safe space to escape the surroundings. The safe space provided would be used as an escapism from the environment in addition to a space consumers can come together and engage with each other. Selfridges identify as a retailer that has previously offered consumers a silent space within store (Howarth, 2013). It is recommended that mood retail is incorporated within the safe spaces â€“ light therapy, soundscapes and natural scents â€“ offering consumers an emotional connection whilst undertaking rest bite. This would be recommended for high-street retailers that are located upon busy areas, such as Topshopâ€™s Oxford Street store, who have a range of consumers. Educational VR The study forecasted education as a trend, in which fashion retailers should aspire to capitalise upon. It is recommended that they utilise VR to create immersive, educational experiences within the store environment. Ikea identify as a retailer offering educational experiences with VR by offering consumer the chance to walk the life of someone with dementia (Buckland, 2018). This would be recommended for brands that offer a sustainable strategy, such as Stella McCartney, to capitalise upon the trend by allowing consumers to immersively seek an understanding of how their product are made compared to other fast fashion retailers. Combination It is recommended that fashion retailers should capitalise upon markets that identify within the transformation economy to offer transformative experiences within the retail environment. Nike identify as a retailer merging markets, by placing gyms within its head office to improve the health and wellness of its employees (Yarow, 2013). It is recommended incorporating popular wellness areas within the store environment, such as yoga, offering consumers the chance of transforming their mental and physically wellbeing. This is recommended to work within large department stores including Harrods, where consumers seek to gage more than just a shopping experience. Further Research This study focused on the millennial generation. Therefore, research is limited into different generations, Generation Z or X, values and needs as consumers. Further research would allow fashion retailer to gage a better understanding of what audience to target their transformative experiences rather than specifically focusing on millennials. For example, this would work well for fast fashion retailers who have a wide scope of consumers.
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List of Picture References cont.
Figure 42 - Nikerunning (2016) Run your goals. Instagram, 12th April. Available at https:// www.instagram.com/p/BEFOMxySoVE/. (Accessed on 20/11/18) Figure 43 - Nikerunning (2016) It could be a modern art piece..if running was allowed in museums. Instagram, 15th August. Available at https://www.instagram.com/p/BJG2Q0gbxw/. (Accessed on 20/11/18) Figure 44 - Nikerunning (2016) We dare you to find a faster track. Instagram, 13th August. Available at https://www.instagram.com/p/BJDxf6uAP2o/. (Accessed on 20/11/18) Figure 45 - Nikerunning (Unknown) Instagram. Available at https://www.instagram.com/ nikerunning/. (Accessed on 20/11/18) Figure 46 - Nikerunning (2018) Get connected through sport. Instagram, 5th October. Available at https://www.instagram.com/p/BojuYhAArPW/. (Accessed on 20/11/18) Figure 47 - Nikerunning (2015) Lets take this relationship farther. Instagram, 14th February. Available at https://www.instagram.com/p/zFcIL7SoXC/. (Accessed on 20/11/18) Figure 48 - Mobilemarketing (2018) Headspace acquires digital assistant specialists alpine.ai. Available at https://mobilemarketingmagazine.com/headspace-acquires-digital-assistantspecialists-alpineai. (Accessed on 19/11/18) Figure 49 - The Verge (2016) Nike redesigned its popular app, and users are very angry. Available at https://www.theverge.com/2016/8/27/12670716/nike-running-app-badredesign. (Accessed on 19/11/18) Figure 50 - Nike (2016) There’s no map where you’re going. The open road is yours. Instagram, 3rd May. Available at https://www.instagram.com/p/BE7TmdFyoYN/. (Accessed on 20/11/18) Figure 51 - WGSN (2018) London design biennale. Available at https://www.wgsn.com/ content/board_viewer/#/80789/page/1. (Accessed on 20/11/18) Figure 52 - Aestheticamag (2017) Julio Le Parc: Form into Action explores the artist’s role in the 20th century as an advocate and point of reference for social and political change. Instagram, 3rd February, Available at https://www.instagram.com/p/BQDeUakAo-I/. (Accessed on 21/11/18) Figure 53 - The Impression (Unknown) Galeria Melissa NYC flagship. Available at https:// theimpression.com/galeria-melissa-nyc-flagship-store-review/. (Accessed on 21/11/18) Figure 54 - LS:N (2017) A post-material consumer experience. Available at https://www. lsnglobal.com/news/article/21493/a-post-material-consumer-experience. (Accessed on 21/11/18) 65
List of Picture References cont.
Figure 55 - Smith (2016) The body studio at Selfridges. Available at http://www. rarelywearslipstick.com/2016/04/the-body-studio-at-selfridges/. (Accessed on 20/11/18) Figure 56 - Globetrender (2017) Five feet to fitness: Hilton creates hotel rooms with gyms. Available at http://globetrendermagazine.com/2017/07/10/hilton-hotel-room-gyms/. (Accessed on 21/11/18) Figure 57 - Ateliers Jean Nouvel (2012) The Louvre Abu Dhabi. Available at https://www. archdaily.com/298058/the-louvre-abu-dhabi-museum-ateliers-jean-nouvel. (Accessed on 20/11/18) Figure 58 - Ignant (2017) Jil sander store. Berlin, Germany. Available at https://www.ignant. com/2017/05/24/jil-sander-store-berlin-germany/. (Accessed on 21/11/18)
Appendices 1: Focus Group
1) Researcher – So my first question is, what would you consider that are your personal value and needs? Please give me your top three: P1 – So my three values are, erm, to have a comfortable life, family security and good health P2 – My top three values are, erm, financial security, job security and to have a comfortable life P3 – Erm, my top values are happiness, family security and job security P4 – Erm, financial security, family security and happiness 2) Researcher – Thank you. My second question is, what would you say that you value from a retailer? For example, the experience they offer, the quality of products, pricing and whilst your explaining if you have any brands in mine please share: P1 – Erm, I would say it’s a bit of everything. You expect like the full package from brands. Like good customer service, products need to be good. Obviously like where I shop as well isn’t as such high-quality things. Erm, also for the store experience, it needs to be tidy and clean and simple P2 – I mean, as a student, my priority is price at the moment. If I had more money it would probably be quality, but I take what I can get P3 – Yeah, I ideally would say I would love to be able to say quality but I can’t afford it, so definitely price over anything P4 – Erm, I’d say price again and quality but not in the sense that there has to be a compromise between if I have more money I can get quality. And I don’t expect things that would last me 20 years but I don’t expect to go to Zara and buy a jumpsuit that the zip brakes after wearing it once. You don’t expect something to last for 20 years but you don’t expect Joni jeans to fade are like four washes. There shouldn’t be a compromise between one or the other. I feel like retailers have a duty, if you’re paying for anything it shouldn’t just end up un the bin after 4 washes. Its more the retailers fault than ours most of the time because its just unwearable. 3) Researcher – Thank you. My third question, what would you consider a good experience from a retailer? For example, good customer service, instore technology or something that changes your outlook on life: P1 – Erm, I think when I go shopping the first thing I expect is good customer service because it’s like not hard to be polite. Like you can go into Topshop or Selfridges and receive bad service. Selfridges is the worst example, they have really judgey staff and I say that the makeup counter, unless you’re like a make-up artist, they just ignore you. Erm, I think it would be nicer if brands had more technology instore. I think it’s probably more like the luxury stores that, like you know, the digital mirror but it would be nice if they had that in Topshop. P2 – I think it would be nice to have really good customer service but I just think in this climate today where so many shops are shutting down, or don’t employ as many staff, so I feel like they are run raged, so I can’t even expect amazing customer service anymore. So I feel like if they can’t offer that, they should be able to offer the technology instore when browsing, so if you can’t find something look on the website. I think technology is important. It’s like second, customers service is still my main really. xxi
Appendices 1: Focus Group cont.
P3 – Yeah, I think good customer service is important for me. It makes a good retail experience because if you go up to someone and say you ask for help because you can’t find something that you’re looking for, and you get a miserable response, it kind of puts you off wanting to ask for something. P1 – Especially in Zara and Topshop P3 – That’s very true. Yeah it puts you off wanting to ask, they obviously don’t consider because it puts you off buying anything and that’s a loss for them but I just can’t be bothered if they are going to be rude to me if you have to ask them to do their job P1 – Yeah, it’s like you’re an inconvenience to them and that’s their job P3 – Yeah, you literally just ask them to check for another size and they say they don’t think they have it without even looking. Yeah Zara are the worst for that P4 – Erm, I’d say technology is important but not in a fad way, like not just doing it for the sake of it, like by putting some fancy thing in it just to make the customer feel like omg that’s amazing. But technology that perhaps aids you, like sometimes when they don’t have what you ask for, don’t have what you need and then you go to the desk and they will order it for you. It’s more like one then and its more of an ability to do that, more ability to stock check instore and online and a lot don’t actually follow what they say. So, like you could, I don’t know, stock check instore and being able to order things to come into store but not having to have a staff member run raged. Like making the technology practical rather than just implementing it because it’s a fad. Because I feel like it’s just a waste of money and it’s not actually improving anyone’s experience. P1 – I was just going to say, like even though we are talking about the stock checking, it’s just weird because in Argos it’s been like that for years and years and years P4 – Yeah, I don’t know why other brands can’t do that P1 – So it’s just weird that it hasn’t been filtered into fashion P4 – They could offer the same service where it’s in the back and then someone goes and gets it from the back P1 – I just think it’s a basic thing that would speed up the process to make it more seamless P2 – I think either Schuh or Footlocker have iPad’s always with them P1 – Yes, they do P2 – So they can be asking do you have this size P4 – I feel like stores could be so much, not smaller but like wouldn’t have such overwhelming stores. Like imagine a store that have one of each product out, and the store itself is like more of a pleasurable experience to be in because it’s not trying to fit every single coat in every single size on one small rack. They can keep the stock out the back and they check whether they have your size and go and get it for you, it would be a lot more enjoyable to walk around rather than just all the clothes on the floor P1 – Yeah, it’s kind of like if there is too many things that they have rammed all together, you just can’t even be bothered to look P3 – I find Primark stressful for that, as in they put too much stock in so you can’t actually see it P4 – They just have to get everything out in one go. Like they don’t think but I feel like it would work if they kept the stock system just like luxury stores P1 – Less stock but better quality
Appendices 1: Focus Group cont.
P1 – Less stock but better quality P4 – That you can still have access to if you need it P1 – Yeah, like the rest if they could have iPad’s and stuff, but there is still a little section instore P2 – And they wouldn’t be constantly hiding, like the service offered is still good and not constantly tidying P4 – Yeah like they aren’t cleaners are they, they have an interest in what they do. They would rather probably be bothered about the clothes than have to pick up clothes that someone has dumped on the floor 4)
Researcher – Thank you. Have you had any good or bad experiences in the past?
P1 – Erm, every time I go shopping, all the clothes are really bad. I don’t think I have ever had a good experience. The only time I have had good experience in terms of customers service is when you’re buying something expensive, like technology. So, say you went to buy a new laptop, they will spend ages with you making sure you’re buying the right thing and talking through it. But yeah, I don’t get the same feeling inn high street fashion stores P2 – I think, like I don’t even really like shopping instore anymore. I prefer ordering online just purely because I just find it really stressful going into store and everything is a mess and I just don’t know I don’t enjoy it anymore P3 – Erm, yeah and I like think the worst ever is when you go into a shop and they just have all the sale racks out. I can’t stand brands, they need to organise it if they are going to do a sale. Like things you just have to rummage through them and everyone just throws stuff on the floor and then you can’t be bothered to look through and stuff goes to waste P1 – Yeah, I was just going to say what you were saying. Like you know with the sale stuff, I don’t know why they don’t treat it like their normal stock and present it nicely P3 – All it takes is to organise them on rales and just like lay it out nicely, allocate a bit of the shop but yeah, I think sales are just a bad experience P1 – Yeah, it’s like in Topshop, you know when they have got the little rail that’s last chance to buy. That’s just like 10 pieces on it and it looks really nice P2 – It makes it look more exclusive as well P1 – Yeah it does and you want to but it before it goes P3 – It makes it a bit more special, like you feel like you’re buying something special P1 – It makes you feel that no one else has it
Appendices 1: Focus Group cont.
P4 – Erm, I don’t know, I feel like, what was being said about how you can go and buy something really expensive like a new laptop or a phone or whatever, they sit and spend loads of time with you to make sure it’s right but I just feel that shows the attitudes of what people think of fashion genuinely. It’s just a commodity, it’s like going to do your food shop at Asda and walking around like it’s not like clothes shopping when my mum and grandma went years ago, when it was like a big deal and you wouldn’t go often and it was luxury and more expensive. And where as now it is literally like going to the supermarket. Like we will go into Tesco and go and pick up milk and then we will go to Topshop and have a look around and see if there is anything we want at the same time. And I feel like I don’t know, like its just what we all do. But I feel like that’s what stores treat it as, as well, like with the sale rack sector. Like they know what everyone is going to know when the Topshop sale is and people are going to no matter what. They don’t care about making it look nice because they know people are going to buy it either way because people just see a cheap top and they will obviously go and buy it P1 – Yeah, because you couldn’t say it’s the same as going to buy something from Burberry. That’s a special piece where as you just see the cheaper clothes else where P4 – You’re not going to keep it either way, you will wear it until you don’t want it and it will get chucked out where as if I went and brought a Burberry coat or a new computer, like obviously you’re going to keep that until like for years and years and years. It’s kind of a different feeling and that’s probably why in shops customers assistants are probably so, you don’t have to have an interest within fashion to work in a clothes shop. You know what I mean, but you couldn’t work in Apple and sell laptops unless you know a lot about technology. See so now if they had people instore that actually cared about what they did, I feel like it would make the experience a lot more enjoyable 5) Researcher – Thank you. The next question is, would you pay for an experience from a retailer or would you expect this to come naturally? P1 – Erm, I would expect it to be a part of their brand, like I don’t think you should have to pay for happy members of staff and things like that P2 – Yeah, I agree. I don’t think you should be paying extra for anything like that, that should just be a part of who they are P3 – Yeah same, I think you shouldn’t have to pay for it, it should just happen naturally P4 – I don’t think as much as the staff can be rude in Selfridges, you’ll pay a lot more for a product in Selfridges than you would anywhere else. Why are you paying more for it? You’re paying for more for it because of what they make the store look like and because of the staff and what they do and everything else. So as much as you shouldn’t have to pay, I don’t feel like you should have to pay for it at all but I feel like it is there because you wonder why Primark is so cheap. Like it’s the same where I work, like my pub sells the same as bars in Brindley Place. It’s exactly the same product, but why it’s ours so much cheaper. It’s because we don’t have the same staff, same glassware and the same furniture and this that and the other. That’s why you pay twice as much for a drink in Brindley Place. P1 – Yeah
Appendices 1: Focus Group cont.
P4 – Like you shouldn’t have to pay anything like putting your credit card in, its £10 to get into a store, but I feel like it translates into the prices that you pay for the product P1 – That’s true, because like when we talk about designer that’s probably still made in China P4 – It is P1 – I swear like the Chanel bag is like, I don’t know let’s say it costs them £200 to make it but they sell it for £2000, so its premium 6) Researcher – Thank you. My next question is, do you have an understanding of the transformation economy? What is it and if you feel as if you have received an experience within this economy? P1 – I have never heard of it before P2 – No I have never heard of it either P3 – No, me either P4 – I have heard of it but I probably don’t know as much as you do. In regard to fashion, I don’t think I have seen anything. The only brand that I can think of that not translates with the transformation economy but they promote fashion as more of an experience itself rather than a product is Patagonia. The way they market their products, erm, it’s a lot less about selling it to people but showing like what it can provide to people and how it can make people have more enjoyable experiences rather than the benefit of the product. But I haven’t seen it in terms of mass brands offering life a life changing event 7) Researcher – Thank you. My next question is, would you like a retail experience that offers a chance to change your lifestyle, fulfil your personal needs or educate yourself on something new that would ultimately change your outlook on life? Researcher – So if I give you all an example of a brand that offers a transformative experience. I am not sure whether you have all heard of headspace? It’s like a personal app that offers meditation at a price for the use of the app, so they are offering the service of the app, the experience of meditation and then offering to transform your health and wellbeing: P1 – I don’t know, I feel like because that’s a different ball game in a way. Like, say you’ve got the health and wellness apps, I think it would be really weird for a brand such as Topshop to offer that P4 – I don’t feel like I would trust any brand. I feel like if a brand was to do it, it would have to be a new brand. I don’t feel like existing brands could do it because I know only brand such as Topshop care about making money and Zara too. You know that whatever they do, it will be superficial to start with and Topshop won’t care, like clothing brands probably won’t care about it. I guess if a new brand started up that we hadn’t heard off, it would probably be successful because we don’t know their motivations and stuff. But a brand that is already existing that we have brought clothes from for years, if they suddenly started offering that, it would kind of feel very fad like. It’s like brands that say they care about the environment, when we all kind of know that they don’t. I feel like its similar. I wouldn’t trust it and I would know whether that had a motive.
Appendices 1: Focus Group cont.
P1 – Yeah, like unless the brand was built on a purpose and that’s what they just focused on. Say there was a like a retailer that kind of does a bit of everything, it’s not really their brand message. Like are they doing it for the motives? P4 – It’s like, are they trying to convince more people to buy P2 – And then by the next year, it will phase out P4 – But I feel like if I was to change my life in a way that matters, I feel like caring less about what people think about you would be a big deal to a lot of people and a lot of it is buying clothes. And I feel like brands are always going to want to make money in a way, and if they weren’t charging for the experience, the only wat they would make money is their product. So, if you think they would be transforming how you think and your life, you would be worried that they were pushing you in a direction to actually spend more and I wouldn’t be able to trust what they were telling me to do 8) Researcher – So now that you have an understanding of what a transformative experience is within the transformation economy, would you still have the same opinion about paying for your experience? Especially if it offers transformative outcomes Researcher – If I give you further examples of transformative experiences such as Nike offering a payable app with personalisation to allow you to transform your body and travel experiences which offer self-fulfilment or are educational, changing your outlook on life P1 – Erm, I understand what you mean about paying for an experience now. I guess we are all willing to pay for like a gym membership and fitness apps and they, I guess are classed as offering transforming your body and life. I would pay for something that offers me a transformation, I just am not sure how like fashion brands would be able to adapt. Like we said before, I think it would have to be like a new brand completely so they have the intentions of wanting to improve us P2 – Yeah, I agree, I would pay for something that offers a transformation in my life, if it was to offer me like a better life or something that changes it for the better. But it would have to be really good for me to want to pay for an experience, not just like the rubbish ones that you like receive in some stores. But also, I feel like money plays a like large factor in this and at this moment as a student, paying for an experience such as travel is limited but it is definitely something, like, I would like to do in the future P1 – Yeah, I agree with you on that, I don’t mind as such like paying for an app that would offer transformation such as Nike, but I have used the headspace app before but I haven’t paid but I guess like you get more out of a subscription. But for other payments such as travel would limit me at the moment but I do agree that travel become learning opportunities such as Bali and Thailand where people go buy themselves to travel and learn are popular. Just are not something like I can afford now P3 – Yeah, I erm agree with you all
Appendices 1: Focus Group cont.
P4 – Erm, I do to an extent because like I go to the gym so I pay for that, but I wouldn’t consider it as a transformative experience in the sense that, like although it offers me the chance to change my body, I don’t feel like it’s a special, personal experience. But I do like agree that I would pay for one if it really did promise the fact of transformation, like I agree again about fashion would have to be like new so it wasn’t lying and intensions were right. But yeah, I think again money is an issue as a student, but I guess if your older, you have money to think about other things, such as improving yourself rather than just to pay for your livelihood like I do now 9) Researcher – Another way brands are trying to tap into the transformation economy is by utilising AR/VR within their experiences. What are your thoughts on VAR? P1 – Erm, I can’t say I have ever been in an experience that includes AR/VR. although, like it is something you hear people talk about, you like don’t see it that often around as an experience but yet again, that may be why because the transformation economy hasn’t like evolved properly. But I thought we would have seen it more than it is offered. But then again, I am mainly talking about fashion but at the same time, like I haven’t seen it in technological stores like Apple or something. But if we are talking about the mirrors like I had said in luxury, it would be something I would be interested in P2 – No I can’t say I have either but I’m not sure if it would be like something I’m interested in doing. I don’t know how I feel about it but I think I would like, need to try it to have an opinion on it P3 – Yeah, I have used AR in a Charlotte Tilbury store. I found it like a little weird at first but it does enhance your service in store as it allowed me to see myself with their make-up looks on my face. But that’s the only experience I have had. I think like I would like more. P4 – Erm, no it’s not something that I had thought of, I’m not sure if like brands would use it as more of a fad experience rather than utilising it for the purpose of the brand but it would be like interesting to see experiences using it but I just haven’t yet 10) Researcher – Thank you. For my last and final question, I am going to let you have a read of the ‘Lifelong Learner’ tribe by LSN and I would like you to think whether you identify yourself with this trend in any aspect and explain if you do or if you don’t: P1 – I think that I automatically don’t fit within the tribe, like because I’m not in the high earner bracket. But I do guess that if a lot of Americans who are in both so I guess that like can’t be the main factor but I think it definitely aids it as they have more money to like play with to think about what they are spending it on whereas where I am a student, I only think of necessities rather than luxuries. I think when we are talking about the appreciation of craftsmanship, like I do but again I can’t afford it. Like I definitely when I’m older would rather have return investment on my items rather than capital gains. Like I like these ideas and I think about them and I wish I was that person, but now at this stage in my life I’m not. With the social media I don’t know, I just like gossip too much over inspiration
Appendices 1: Focus Group cont.
P2 – Yeah, no I don’t think it resonates with me but I do like to try and appreciate the craftsmanship of stuff, like luxury brands and designers. I appreciate the art and design and everything that goes into it but I don’t buy into it. No, the tribe I don’t think sounds like me but I don’t actually use social media. P3 – See, I think I’m similar to the others in the sense that you want to be, but in a sense, I do because I use my Instagram as a way of connecting my textiles and my embroidery career to other people and I use it as a way of inspiriting me, learning new techniques and getting these ideas. And I do appreciate craftsmanship in the way that I know exactly how embroidery is created in the time it takes to create it, so I think elements of me fit into it but not yet anyway, such as wanting to travel more. Maybe one day in the future when I have a bit more money. P1 – Like when your older and have a full-time job and have money to think about what your spending, you appreciate things more for what they do P4 – Erm, I feel like I do appreciate educational experiences and I really do enjoy fitness elements as I like to keep an eye on my image. I do often go to workshops in regard to my uni work, like to aid that and I guess to learn and educate myself better, like I do it in my university course a lot. I do like resonate myself with social media as I do not use it for celebrity use, I use it as a way to learn and educate myself on matters, in addition to promoting my university work. But it’s not a tribe I would say that I apply to massively, only in small parts P1 – Yeah, I feel like those characteristics are when I get a bit older, such as maybe 25+ when I have an income to play with Researcher – That’s the end of the questions. Thank you all for taking part.
Appendices 2: Joseph Pine Interview
Interviewer - Hi James/Joseph, I hope you are well. My name is Jessica Wiseman, a third-year student studying ‘Fashion Business and Promotion’ at Birmingham City University. I am currently undertaking my dissertation around the topic of the transformation economy, striving to answer the question ‘How can the rise of the transformation economy be adapted within fashion retailer’s strategies to improve the way experiences are delivered to millennials?’. To aid my research, I was wondering if you would be able to answer a couple of questions that I have for yourselves. My first question is based upon your ‘The experience economy’ 2011 edition book. Your final economic value theory is the transformation economy. Do you believe that this economy has fully evolved, stepping away from the experience economy? Or do you believe this has only just started to evolve or if it hasn’t at all? My second question is about the future. Do you believe the transformation economy is the final economic value stage or do you believe there is further progression? I would hugely appreciate if you would be able to help me aid my research for my dissertation but I understand if you are unable to help/answer the questions. Thank you for taking your time out of your day to consider this email, Jessica Wiseman Interviewee - Jessica, it is always a joy to help out students! That’s how I got my start at MIT by practitioners helping me with the research that led to my first book, Mass Customization. So, first, what a fascinating topic you have! I haven’t thought myself about transformations within fashion retailers. But I have done a lot of thinking about retail and experiences, and so have attached an article from the Journal of Shopper Research (plus one that provides a good overview and background of experiences and transformations). I also wrote this piece on retail experiences to highlight all the writing I’ve done on the topic last year: https://strategichorizons.com/experience-economy/the-year-of-retail-experiences/ Also note this article on fashion and transformations based on my work in the UK site Business of Fashion (if you haven’t already seen it): https://www.businessoffashion.com/articles/intelligence/are-luxury-brands-ready-for-thetransformation-economy-wellness-health-direct-vision Now, to your questions, first, the Transformation Economy has in no way fully evolved. Like all the other economic offerings, transformations have pretty much always been around, and even today companies that are at least naturally in the transformation business (healthcare, fitness centers, educational institutions, consultants) rival experiences for size in the economy. But we have a long way to go, for one is only in the transformation business economically if one charges for the demonstrated outcomes that customers achieve, and few do that. So there’s a great deal more maturity required. It’s also true that consumers are not at all used to paying for outcomes (that’s a little less true in B2B industries), so it will take awhile to get that going. xxix
Appendices 2: Joseph Pine Interview cont.
Second. yes, transformations are the fifth and final economic offering in the Progression of Economic Value as we explain in the Encore starting on p. 297 of the Updated Edition. So please do read that. Feel free to ask follow-ups! Joe Pine Interviewer - Hi Joseph, Hope you are well! I am sorry for the delay in the reply to your previous email, its been a very busy time writing the dissertation! But thank you so much in getting back to me with such helpful answers, its really aided me with writing my dissertation. I just have another question to ask you if that is okay? I had previously stated in my email that I am looking at fashion retailers and how they can offer transformative experiences. I was just wondering if you had any ideas how they could do this in your opinion? Thank you so much again, Jessica Interviewee - Well, frankly, I do not think it makes much sense for fashion retailers to try to offer transformative experiences! I would rather see them spend their efforts actually enhancing the in-store experience.... But, that said, I think of the flagship Lush store there in London on Oxford Street. It offers a spa, including massage treatments, that could be transformational for people in pain, who need to relax, etc. There are some fashion retailers who could do something similar. You could also think that fashion retailers could offer a “respite” from a busy day “out there in the city”, turning “in here in the store” into something that did enhance stress, mood, etc. I do think of those as “transformational experiences” as opposed to true transformations as they are unlikely to last. I often talk about “experiences in a box” where people are provided with everything they need to create a great experience themselves (eg, https:// lobstahbox.com/product/lobstahbox-clambake/), and that concept could be expanded into “transformation in a box” that experience. There are also fashion retailers with hotels (eg, Bulgari, Armani, I’m sure many others) who have consumers spend enough time with them (in one visit and especially across visits) that they could offer transformational programs centered around stress reduction, fitness, wellness, even relationship enhancements. Hope that helps. Joe xxx
Appendices 2. Joseph Pine Interview cont.
Interviewer - Hi joe, That does help, thank you! I completely understand where you are coming from with enhancing the store experience, with a transformative experience in it rather than actually offering a product that’s transformative! It’s a really good idea I can put in my work, thank you! Thank you so much for taking your time out to reply to my emails, I really do appreciate you helping me with my dissertation. Thank you again! Jessica Interviewee - So I came across this article today https://www.entrepreneur.com/article/323163 the headline of which caught my eye: “This Facial Shop Focused on Helping People Instead of Pushing Products”. So perhaps transformational, but you would have to explore it more. I like that it customizes its facials: https://www.heydayskincare.com/ and its talked about as the “Drybar of facials”: https://www.fastcompany.com/90178025/heyday-the-drybar-of-facials-is-expanding-to-losangeles Joe Interviewer - Hi Joe, Thank you for thinking of me when you saw that article! I have had a read and its very interesting! I am going to use this within my dissertation. Again, thank you so much for all your help. I really do appreciate you taking time out of your day to reply to me and think of me when you see articles that are useful. You really have aided me with me research and I can’t thank you enough. Jessica Interviewee - You are of course most welcome! You just owe me a (digital) copy of your dissertation when done! :-) Joe