We are in the middle of a revolution. A revolution that will render the principles and models of traditional marketing obsolete. A revolution that will change the face of marketing forever. A revolution that will replace traditional feature-and-benefit marketing with experiential marketing.

As the new millenium approaches, three phenomena are signaling an entirely new approach to marketing, if not to doing business as a whole. These three simultaneous developments are (1) the omnipresence of information technology, (2) the supremacy of the brand, and (3) the ubiquity of communications and entertainment.

Copyright © 1999 Bernd H. Schmitt

From Chapter 2: THE BREADTH AND SCOPE OF EXPERIENTIAL MARKETING

Experiential marketing can be used beneficially in many situations including

• To turn around a declining brand
• To differentiate a product from competition
• To create an image and identity for a corporation
• To promote innovations
• To induce trial, purchase and, most importantly, loyal consumption

So, will experiential marketing replace traditional marketing in its entirety? Or is it or an alternative approach that complements traditional marketing? Most important, is experiential marketing likely to last?

Answers to these questions depend on the product category and industry as well as the intended customer target and management. In some industries (consumer products and services) experiential marketing is likely to remain the focus for the foreseeable future, especially given the trends discussed in chapter 1. In other industries (e.g., business-to-business, industrial and technology markets) experiential marketing enriches the offer and provides avaluable complementary approach to traditional marketing.

For the moment, let's take a look around and see where and how experiential marketing is being used. We'll start our tour with transportation vehicles (like cars, trains and airplanes) and then move on to more unexpected places where experiential marketing is turning up, such as technology and industrial products; news and entertainment; consulting, medical and other professional services; and financial products.

Copyright © 1999 Bernd H. Schmitt

From Chapter 3: A FRAMEWORK FOR MANAGING CUSTOMER EXPERIENCES

Modularity of the mind, i.e., the view that the mind is composed of specialized functional parts, provides a wonderful metaphor and practical lesson for experiential marketing: Experiences may be dissected into different types, each with their own inherent structures and processes. As a manager you may view these different types of experiences as strategic experiential modules (SEMs) that constitute the objectives of your marketing efforts.

Let me provide a brief description of the five types of customer experiences that form the basis of the Experiential Marketing Framework.

Copyright © 1999 Bernd H. Schmitt

From Chapter 4: Sense

Procter & Gamble's Tide, the nation's leading laundry detergent, has been promoted for years on the basis of features and benefits as a more effective cleaner than other brands. Tide's ads have been a staple of American TV viewing for years: on the left side of your TV screen was a striped shirt with a tough stain that the other brand failed to get out; on the right was the same fabric, washed brilliantly clean by Tide. The drill has been fundamentally the same for all of Tide's various incarnations: traditional Tide, Tide with bleach, perfume-free Tide. In February 1998, after I gave a presentation on experiential marketing organized by the Design Management Institute, Ms. Claudia Kotchka, vice president at Procter and Gamble, confessed: "We'd need more of experiential marketing for our products including Tide."

Tide's new campaign, "Tide Mountain Fresh," has a direct sensory appeal, and P&G's marketing of the product is designed to exploit and expand this appeal. The advertising displays images of snow-capped mountains, hills covered with fragrant evergreens, and meadows full of wildflowers; the colors are cool, vivid, and refreshing. The language is equally evocative of the outdoor experience: "crisp mountain air; bright sunshine and coolbreezes; fresh wildflowers; clear spring water; clean mountain snow." The copy goes on to promise, "now you can bring the fresh clean scent of the great outdoor inside with New Mountain Spring Tide." P&G has even incorporated a scratch and sniff feature in their print advertising, to introduce the scent and allow consumers to experience it before purchasing the product. P&G has made a coherent effort to create the strong sensory experience of a cool morning on a mountaintop. What's more, they have taken a decisive step in the direction of experiential marketing. The tag line for their new ads -- "There's Something New in the Air" -- heralds something more than just a new product scent! In sum, the SENSE campaign for Tide results in multiple sensory experiences.

Copyright © 1999 Bernd H. Schmitt

From Chapter 5: FEEL

Most emotional advertising features smiling faces, crying babies, barking poodles, accompanied by a lot of sing-song and jingles. In some rare cases, the product or consumption situation lends itself to an emotional focus. For example, making (personal) phone calls involves feeling; so AT&T's "Reach out and Touch Someone" made sense. But in many cases, the relation between product and feeling is coincidental and purely driven by a brand manager's or ad executive's decision to jump on the "emotional ad" bandwagon.

These emotional advertising campaigns measure up well in the short run, meaning on some "emotion scale" taken right after the exposure to the ad. But what do these scales really measure? It seems to me most of them measure consumers' memory for certain contents of the ad and how smart the consumer is in guessing what the market researcher has in mind. It is as if the consumer is saying: "All right. You want to know whether after seeing all these happy faces, kids and dogs, I feel 'warm,' 'full of joy' and 'glowing with happiness.' Sure. So I'm not a monster after all." In other words, these types of measures have produced massive overstatements regarding the effectiveness of "emotional advertising." Most customers are too smart to be fooled by simple, thirty-second commercials (repeated daily). These ads do not possess the power of a three-hour feature likeTitanic(not to mention the same dramatic qualities), and as a result, they have only a tiny impact. Does this mean that all emotional advertising is wasted? Definitely not. However, if you want your advertising to work, you need to do three things: (1) have patience; (2) hire a good producer and (3) use ads as an interpretive framework for consumption. All of these techniques require deep pockets. Let me explain.

Copyright © 1999 Bernd H. Schmitt

From Chapter 6: THINK

The essence of THINK marketing is to appeal to customers' creative thinking about a company and its brands. THINK marketing is appropriate for a wide variety of products and services. Although Apple Computers and Genesis ElderCare are in radically different businesses, they both appeal to creative thinking. Cutting-edge retailers, termed the "Teach and Sell school of retailing" byThe New York Times,are also discovering THINK marketing. Examples include the Discovery Channel store in Washington which displays a model of aTyrannosaurus rexand an emerald beetle as part of many other interactive educational displays; Mars, a Fort Lauderdale music supply shop where teenagers can take drumming lessons; and Tourneau in New York where customers learn about the history of watches.

Even the world of fashion and beauty may use THINK campaigns. For example, Eddie Bauer, the men's casual clothing retailer, has used inspirational THINK concepts throughout its stores: "Inspire," "Imagine," "Insight," "Intrigue," "Inhabit (your surroundings)" were terms written all over their retail space, accompanied by sedate pictures of tulips, lakes and mountains.

It is important, however, to keep in mind who you are communicating with, in what context. Just putting up association-provoking "Think" terms may work for Eddie Bauer but fail in an annual report. As Lucy Kellaway of theFinancial Timesobserves: "You might think that the world of annual reports is not particularly fashion sensitive, but you would be wrong....A couple of years ago the trendy thing was to put a picture on the cover showing team work. Last year it was back to basics with plain pictures of the products. This year the smart thing is to plaster big words from the mission statement across the cover -- making them more prominent than the name of the company itself." She refers to: Future. Focused. Value. Quality. Growth. "By using one of these lame cliches a company only succeeds in looking just like everyone else."

Copyright © 1999 Bernd H. Schmitt

From Chapter 7: ACT

How the medium of interaction can affect experiences is a key issue for any service provider. In chapter 5 we learned that well-trained real-life salespeople are critical for inducing strong positive emotions. The key word is "well trained," or else the opposite occurs: strong negative emotions. Yet, there is the broader issue of what kind of behavior the presence or absence of other people affords. Thus the strategic decision is, "automate or personate?" and the answer depends on the type of service. Ask yourself: for what type of banking transactions (or services in general) do you prefer an automatic teller machine, and for which ones a personal teller? It also depends on the customer. Some customers (older people on a leisure trip) prefer to pick up the key and documents from a car-rental counter (assuming there are no lines); others prefer to go straight to the car and drive off (younger customers on a business trip?). The reason are not only considerations of time. The entire experience changes in terms of control, initiative and feelings of being taken care of.

Copyright © 1999 Bernd H. Schmitt

From Chapter 8: RELATE

RELATE has been used successfully in a variety of recent marketing campaigns. Let's examine some of them.

Let's start with relating to a person. In the last chapter we looked at the ACT appeal of Martha Stewart. Her RELATE appeal is just as powerful and, for some, highly personal. Women who don't admire Martha, as well as those who do, speculate about "being" Martha. One writer describes her tongue-in-cheek foray into the world of domestic perfection: "the idea -- regrettably, my own -- was to see whether I could be Martha Stewart in time for the holidays." Despite the humor of the topic, many people do relate to Martha as the embodiment of an elegant and relaxed lifestyle.

Reference-group feelings can provide a powerful starting point for a RELATE campaign. Just think about Harley Davidson, the American icon of free-spiritedness, which draws thousands of motorcycle enthusiasts to weekend rallies staged around the country. Harley Davidson evokes such strong relations that owners tattoo the logo on their arms or their entire bodies. As Alec Wilkinson wrote inThe New York Times:"If you ride a Harley, you are a member of a brotherhood, and if you don't, you are not."

On a higher-end scale, we find yet another brotherhood -- that of Tommy Hilfiger, the phenomenally successful American casual-clothing designer brand. Like Harley Davidson, Tommy Hilfiger has used RELATE marketing for many years. A recently launched Tommy fragrance uses the tag line, "the real American fragrance." Print ads show groups of wholesome-looking young people of different races, wearing Tommy fashions and relaxing in casual settings. The atmosphere is one of warmth and easy camaraderie among friends. One setting, on a manicured lawn before a large Cape Cod home, is strongly reminiscent of the Kennedy enclave at Hyannisport. Tommy's signature colors -- red white and blue, are carried through in American flags that appear in the background of each shot.

An integrated and successful collection of RELATE products and services is provided by the Franklin-Covey company. Building on the phenomenal success of Steven Covey's best-selling bookThe Seven Habits of Highly Effective People,Franklin-Covey offers a line of Franklin organizers, the Covey Leadership Center, and Covey's books on self-management. They have even opened a line of retail stores, the 7-Habits stores, selling products and services intended to help people get control of their lives.

Finally, RELATE marketing can be serious or playful. A "communist chic" restaurant is all the rage in Singapore. At the House of Mao, waiters wear red stars on their caps and Maoist slogans on their sleeves. A portrait of the late Chinese leader Mao Tse-tung dominates one wall of the restaurant, which is decorated with medals, posters, and copies of Mao's famous Little Red Book. The menu itself mimics the Little Red Book and offers dishes like Long March Chicken and Chairman Mao's Favorite Braised Garlic Pork. This tongue-in-cheek nostalgia is not confined to Asia, either. Shortly after the fall of communism in Europe, a hammer-and-sickle craze swept the region, with pizzerias and cafeterias harking back to the "good" old days in their design and marketing.

Copyright © 1999 Bernd H. Schmitt

From Chapter 9: EXPERIENTIAL HYBRIDS AND HOLISTIC EXPERIENCES

In chapters 4 through 8, I discussed the five strategic experiential modules (SEMs) of SENSE, FEEL, THINK, ACT and RELATE that form the basis of experiential marketing. As we saw, when using a particular SEM, managers need to give careful consideration to its objectives and principles. For each SEM, I have provided a set of concepts, techniques and tools that managers can use once they have decided to use a certain SEM.

SEMs may be viewed as the fundamental building blocks upon which the edifice of experiential marketing rests. As such, they are the starting point -- not the end goal -- of experiential marketing. The ultimate goal of experiential marketing is to create what I call "holistic experiences." In the middle ground on the way to the holistic experiences, we find experiential hybrids. In this chapter, I discuss the structural issues of building hybrids and holistic experiences. Moreover, I will introduce the "Experiential Wheel" as a tool for building hybrids and holistic experiences. Let's first look at some examples.

Copyright © 1999 Bernd H. Schmitt

From Chapter 10: STRATEGIC ISSUES OF EXPERIENTIAL MARKETING

Using the traditional F&B approach, the goal of new product development is often seen as adding new features and benefits, "improving" old products or old technologies. Traditional marketing models view brand extensions in terms of the fit between product categories and the transfer of positive equity from the current brand to the extension product.

In contrast, new product and brand extension decisions using an experiential marketing approach are driven by three factors: (1) the degree to which the new product and extension category enhances the experiential image of the company or brand; (2) the degree to which new products and brand extensions add new experiences that can be leveraged in additional new products and further brand extensions; and (3) the degree to which they help in the creation of holistic experiences. In other words, when Lipton considers extending into teahouses or Johnny Walker into apparel (as both brands have done recently -- Lipton with a Starbucks-style teahouse in Pasadina and Johnny Walker with a boutique in Bloomingdale's), the key issue is whether the overall experience will be right.

Copyright © 1999 Bernd H. Schmitt

Chapter 11: BUILDING THE EXPERIENCE-ORIENTED ORGANIZATION

Applying the terms to present-day organizations, we can contrast as ideal types the Apollonian and the Dionysian organizations. The Apollonian organization is of a rational nature: harmonious, ordered, and planned. It is, ultimately, the result of the spirit of enlightenment. The Dionysian organization is born out of a different understanding of reality. The Dionysian organization is of a passionate-creative nature; it thrives on chaos.

Both the Apollonian and the Dionysian organization have their drawbacks: too Apollonian and the organization stagnates; too Dionysian and the organization may disintegrate. Clearly, an experience-oriented organization needs both elements: the planners who plan and manage and measure, as well as the creatives -- internal and external -- who communicate the message to key customer targets.

But, all else being equal, it is the Dionysian organization that provides the best environment for experiential marketing. Most organizations are too timid, too slow, too bureaucratic in their decision making. I would rather have people around me buzzing with new ideas than arthritic, command-executing automata. I would rather receive too many emails with ideas than too few. In the transition phase from F&B marketing to experiential marketing, in particular, Dionysian processes and initiatives are clearly preferable. What you may lose in predictability you more than make up for in creativity and vision.

However, it is key to make communications as transparent as possible in a the transition from F&B to experiential marketing, and to gain strong support for the approach within the organization. Remember the British Airways' "World Communities" campaign in chapter 4? Reactions to the tail-fins campaign were hostile at practically all levels, from flight attendents to shareholders. Cabin crew as well as shareholders were offended when they were asked to give up "Britishness." It is difficult to secure support externally when you do not have it internally.

Copyright © 1999 Bernd H. Schmitt

---

Excerpted from Experiential Marketing: How to Get Customers to Sense, Feel, Think, Act and Relate to Your Company and Brand by Bernd H. Schmitt
All rights reserved by the original copyright owners. Excerpts are provided for display purposes only and may not be reproduced, reprinted or distributed without the written permission of the publisher.