As a society, we crave experiences. Our demands have shifted along the continuum from buying products, to receiving a service, and now to gaining an experience that is exciting and memorable. For example, experiencing a new travel destination is now more desirable than a shiny new fashion accessory. Therefore, customer loyalty must be earned through consistent, positive experiences that keep customers coming back for more.
As the impact of the experience economy deepens, commercial real estate’s role in creating environments that support unique experiences has become increasingly important. To get a better understanding, let’s start where it all began – with Walt Disney.
Embracing the Fourth Economic Shift
According to Harvard Business Review, the experience economy represents the fourth economic shift, following commodities, goods and services. Walt Disney was a pioneer of this shift, transforming his company from a media service organization to a full-blown entertainment experience business, notably with the creation of Disneyland. The service economy currently dominates the developed world, making up almost 80 percent of all employment in the U.S. As the service economy has expanded and is becoming increasingly commoditized, our perception of economic value has progressed – we increasingly expect a more premium and differentiated economic offering.
Our love affair with experiences is growing in every aspect of our lives. We seek out positive experiences daily through our favourite coffee shop, cocktail bar or specialized workout class. This desire for uplifting experiences pervades our working lives, and real estate becomes the stage for new experiential offerings.
At the macro scale, real estate investors and developers around the world now recognize the importance and value of ensuring their buildings provide a more interactive, diverse and bespoke experience. Forward-looking developers no longer consider a building on a standalone basis – instead, they seek out mixed-use sites that provide an integrated space for working, living and playing.
In the UK, Cushman & Wakefield and one of its long-time property development partners redeveloped London’s Kings Cross, creating a landmark district that attracts top talent and has significantly increased demand for commercial property in the area.
These placemaking initiatives reflect a heightened awareness that user experience is an important component to the success of attracting top talent and providing an inspiring environment for staff.
Defining Workplace Culture
To meet ever-rising employee expectations, companies must rethink the drivers of workplace experience – from the physical environment and amenities to digital services and virtual workspace.
Technology companies are renowned for their focus on delivering great experiences at work. A healthy mix of onsite baristas who remember your name, themed building designs, workplace concierges and massage chairs are designed to give staff a personal experience every day.
Significant efforts have been made to remove the friction in workplace environments and to increase availability and choices of food, drinks, workspace format or downtime space that employees truly value. Additionally, building and strengthening a community within offices has become a priority for workplaces as internal and external event programs aim to drive organizational loyalty and reinforce business culture.
Companies facing a war for talent and increasing competition across all sectors are seeking to understand how the built environment can provide a competitive advantage. A positive workplace experience and culture is a strong hiring tool, and ensuring employees are happy at work has been proven to boost productivity.
Cutting-edge research on workplace experience takes the same level of analysis that companies have traditionally applied to their customers’ experiences, but turns the focus onto staff. Leading companies are using the principles and practices of user experience design, traditionally used in the development of technology and software products, to enhance workplace satisfaction through improved usability, accessibility and pleasure.
Shaping Smart Spaces
Technology is proving to be the quickest gateway for integrating experiences in the built environment. Apps are becoming increasingly popular across professions and industries as they help staff locate a desk, book a meeting room, order lunch or have their dry cleaning delivered. Cushman & Wakefield’s Workplace Edge does just that – empowering employers to curate a more engaging and seamless experience for staff and extending benefits and amenities that would normally be reserved for corporate headquarter locations to non-headquarter employees. By employing sensor-based technologies, we give real estate service providers unprecedented insight and data analytics, enabling them to fine-tune the overall building experience. In the near future, employees’ psychometric and physiological profiles will be captured in a personal key that will communicate with smart buildings’ learning algorithms – enhancing the office experience by delivering tailormade services and nudges to its users.
Technology can also pose risks. Like most business ventures, integrating new technology in the workplace requires strategic direction and guidance. Off-the-shelf apps risk confusing and over-complicating the user experience, and possibly even delivering a negative one. Trust also comes into play when considering any kind of sensor deployment.
Getting to the Heart of It
We can all imagine a scenario where we chose a product or service simply because of the person at the point-of-sale. In essence, experiences are all about people. In the real estate world, this means hiring and training the very best talent to take care of not only buildings and assets, but also the people who occupy them. Taking a cue from best-in-class hoteliers, facilities and property management professionals now supplement technical skills development with soft skills training to deliver service that is more anticipatory and personalized. For employers, this is a direct reflection of their brand and culture that can generate powerful results. After all, why do we pay three times more to buy coffee from the friendly barista? Is the coffee really three times better? Or is it the warm welcome and smiling face? Often, the how is more important than the what.
As the experience economy continues to mature, both real estate owners and occupiers must think differently about competitive differentiation.
Storytelling and emotive experiences, along with convenience and themed ambiance, will become key differentiators of properties and the spaces occupied by organizations. Those who wish to realize success will be quick to embed experience delivery at the heart of their economic offering and evolve this over time. But how do providers begin to think differently?
DEFINE A THEME AND BUILD A STORY
This can be at the building level or across all the services provided. Making it memorable means telling a story.
REFRAME THE ECONOMIC DECISION
When goods still reigned the throne, many companies started providing free services as a differentiator. Eventually, those companies began monetizing said services. Begin by asking the question: If we charged a fee for experiences, what would we offer? It enables the provider to truly think outside the box and deliver something exceptional.
BE STRATEGIC IN THOUGHT
Define the end-point, map out the customer journey and identify user needs. Ensure your experience offering aligns with organizational culture.
MAP OUT THE METRICS
Whether it’s improving employee engagement or increasing the number of customers, define what you aim to achieve. An experience is ephemeral if you don’t define its expected impact. Now real estate providers must follow in Walt Disney’s footsteps: end-users must become guests and the workplace must become the sum of its experiences, not the sum of desks and meeting rooms.
This article first appeared in Cushman & Wakefield’s “The Edge” magazine. To download your copy click here.