1. Bernd Schmitt Columbia Business School Marketing Experiential All rights are reserved. Members of MSI and academic researchers may make limited copies of this presentation, electronically or in print, solely for their internal, non-commercial use. Any other use of this presentation— including reproduction for purposes other than those noted above, modification, distribution, or republication—without prior written permission of the Author is strictly prohibited.

2. Experiential Marketing 2 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002.  What is Experiential Marketing?  Key Concepts of Experiential Marketing  SENSE, FEEL, THINK, ACT and RELATE  Structural, strategic and process issues  The Experience-Oriented Organization Overview of the presentation

3. Experiential Marketing 3 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. ? Marketing What is Experiential

4. Marketing 4 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Methods are analytical, quantitative and verbal Narrow definition of product categories and competition Functional features and benefits (F&B) Customers are rational decision-makers Traditional Marketing

5. Experiential Marketing 5 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Traditional marketing has made important contributions... … but its focus is on F & B... Strategic concepts Segmentation, targeting, positioning Tactical concepts The four P’s Methodologies Choice models, conjoint analyses, perceptual maps

6. Experiential Marketing 6 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. ” …and the world has “Wholly new content will emerge from being digital” - Nicholas Negroponte “Everything is entertainment” - Regis McKenna “Welcome to the experience economy” - Pine and Gilmore changed We are in the middle of the information revolution “

7. Experiential Marketing 7 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Methods are eclectic Focus on consumption Customer experience Customers are rational and emotional animals Experiential Marketing

8. Experiential Marketing 8 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Moving Over The product The consumption situation The socio-cultural context and Up The Socio-Cultural Consumption Vector

9. Experiential Marketing 9 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Two approaches to Brand (ID) Brand (EX) Brands as identifiers Names, logos, and ads Awareness and image before purchase Brands as experience providers Names, logos, ads as well as events, sponsorships and other customer contacts Experiences during purchase and consumption branding

10. Experiential Marketing 10 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Key Concepts

11. Experiential Marketing 11 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Experience Providers (ExPro’s) Communications Co-branding Web Sites Environment Product presence Visual/verbal identity People

12. Experiential Marketing 12 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. FEEL SENSE THINK ACT RELATE

13. Experiential Marketing 13 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Elements Styles Primary and SENSE Symbols ThemesThemes Verbal and visual and Overall impressions This framework is based on: Schmitt and Simonson, “Marketing Aesthetics,” The Free Press, 1997.

14. Experiential Marketing 14 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Moods Light Positive, negative, or neutral Often unspecific Emotions Strong Positive or negative, meaningful Triggered by objects, people and events FEEL

15. Experiential Marketing 15 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. THINK Concepts THINK Campaigns Convergent Divergent Directional Associative THINK

16. Experiential Marketing 16 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Lifestyles Interactions Motor actions and movements Reasoned action Self-perceptions ACTACT

17. Experiential Marketing 17 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Cultural values Brand communities Group membership Reference groups Social roles Social influence Social categorization Social identity RELATE

18. Experiential Marketing 18 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. SENSE FEEL THINK ACT RELATE Acquired Styles, themes, overall impressions Primary elements Complex emotions Moods and primary emotions Divergent thinkingConvergent thinking Body and motor reactions Lifestyles Group relationsKin relations Hard-wired Experiential Response Levels

19. Experiential Marketing 19 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Issues Structural, strategic and process

20. Experiential Marketing 20 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. The experiential hierarchy Experiential hybrid (individual) Experiential hybrid (shared) SENSEFEELTHINKACTRELATE THINK SENSE ACT FEEL RELATE

21. Experiential Marketing 21 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Creating holistic experiences S RF A T S F S F T S F A T 12 43

22. Experiential Marketing 22 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. The Experiential Grid

23. Experiential Marketing 23 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Brand architecture Corporate branding Sub-branding and endorsements Global experiential brands Standardization vs. localization Co-branding Brand extensions Partnership strategies Additional strategic issues

24. Experiential Marketing 24 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Process: the five steps of analyzing the experiential world of the customer building the experiential platform designing the brand experience structuring the customer interface engaging in continuous innovation 1 2 4 5 3 customer experience management

25. Experiential Marketing 25 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. experiential world EX Funneling EX Platform Board EX Branding EX Interfacing EX Innovating Steps and tools experiential platform brand experience customer interface continuous innovation

26. Experiential Marketing 26 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. The complete CEM model brand experience customer interface continuous innovation new customers desired segment lower acquisition costs existing customers retention premium pricing cross-selling word of mouth value to the organization customer experience internal resources experiential marketing product design corporate creativity HR for EX experiential technology

27. Experiential Marketing 27 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. The Experience-Oriented Organization

28. Experiential Marketing 28 © 2002 presented by Bernd Shmitt at the Marketing Science Institute’s Conference on A Hard and a Soft Look at Building Strong Brands on March 14 – 15, 2002. Experiential growth for employees Integrated agencies Creativity and innovation Attractive physical environment Taking the helicopter view The Dionysian culture The Dionysian culture