Lesson 3: The Internet’s Not Ready for the Experience Economy

Lesson 3: The Internet’s Not Ready for the Experience Economy

This is part of a series of blog posts based on the book Rise of the Creative Class by Richard Florida.

One of the things Dr. Florida points out is the creative class’ preference for buying experiences rather then products.  He argues, as many social theorists lead by B. Joseph Pine and James H. Gilmore have, that people have begun to look for pure experiences (travel, going to the gym) as well as looking for an experience along with their products (a 30 minute trip to a cozy coffee shop instead of a cup of coffee).  Florida extends this point by discussing the creative class’ disgust for “Generica” and our preference for authentic experiences (see the success of City Books on Carson while Joseph Beth has failed).

I couldn’t agree more with the point of the growing demand for experiences, in fact, I believe it is one of the greatest business opportunities on the internet right now.  Why?  Because the internet presently sucks at helping us find authentic experiences.  The internet doesn’t introduce you to your favorite restaurant, it doesn’t tell you the best trails to run, it wasn’t a factor in selecting your “go to” bar or coffee shop.  Sure it can help you find these things once you’ve decided on them, but it’s just not ready yet to help you find experiences.  I believe this problem exists for three fundamental reasons:

  1. The Internet doesn’t “know you” well enough to help you find the experience you seek, it’s not as simple as the Amazon, “you might also like”.  There’s a reason you only trust food and bar recommendations from your closest friends, it’s because they know you well enough to know what you like.
  2. Small business owners (the people who have authentic experiences to offer in spades) don’t know how to get their message out on the internet.
  3. The Internet lacks the data model to separate a product, from an experience, from a product that comes with an experience.  Amazon and Google can tell me 200 different places that have the new screw driver I want.  They can even tell me which of those companies is a reliable shipper, or in Google’s case which product is near enough to me to drive or walk.  What it can’t tell me is who has friendly associates, who’s located near the coffee shop I like, who will train me for free on how to use it, who also has the screws I need, and more…

I am bullish on companies that can solve one or more of these three problems because I believe that the Internet will get good at helping people find experiences/products and the companies that solve these problems will make money off of it.  Among the companies I’m aware of that are making innovative progress in the area:

  • FourSquare – The concept of place, and the places and place history of my friends will be an important aspect of both knowing me (number 1) and knowing what constitutes an experience (number 3).
  • Hunch – No company can know you (number 1) better then Hunch can.  Their aggregate data, particularly on the local side, could also help with number 3.
  • Groupon – An easy platform for small businesses to get their message out there (number 2).