Why experiences will win
The following is paraphrased from Kevin Kelly’s recent book, ‘The Inevitable.’
• In general, on average, over time technology wants to be free.
• If a technology persists long enough, its costs begin to approach (but never reach) zero.
• This includes foodstuffs, materials, also appliances and services.
• So in the age of cheap plentitude, what is really valuable?
• Well, our attention to commodities is not worth much. Our monkey mind is cheaply hijacked. Think of the battle waged for our attention by Netflix, Facebook, Snapchat.
• The only things increasing in cost while everything else heads to zero — are human experiences.
• Examples: Luxury entertainment, restaurants, concerts, weddings, personal coaching.
• Think “intensely personal attention”.
• We give these experiences our precious, scarce attention (attention is not renewable — we have a finite amount per day to allot).
• That’s where we’ll spend our money, because they won’t be free, and that’s where we’ll make our money.
• Robots will take nearly all the other jobs (not sorry), but not these.
• Before you start disagreeing, just think about the sheer amount of information and value that’s shared during fantastic service at a Michelin starred restaurant, a few cocktails with a witty bartender, or an intense personal training session with a charismatic, knowledgable coach.
• Of course, these experiences can, and will be magnified, streamlined and improved by technology (how could a modern wedding survive without calendars and reminders) — but at the end of the value chain, the end-user experience is going to be amazing, and it’s going to cost you.
• Side note: Kevin doesn’t talk about brands, and other stuff wall-st analysts struggle to put into spreadsheets.
• I strongly believe that myths / storytelling will always be there to add a layer of value $ to products/services.
• eg. in-app purchases is already a huge business in gaming — people have placed a dollar value on bits (that are free).
• Laugh at gamers buying magical swords all you want, but as Ben Thompson has explained, it’s no different than spending $500 on a small square of leather with a logo on it.
• “If people think its valuable, it’s valuable.”