World Trade
The globalization of business has led to an increasing international exchange of goods. As a consequence, the export and import share of GDP and world economies is rising and is projected to double from 1990 to 2015.2 In 2015, half of all traded goods will be crossing international borders. Global trade is to a high degree dominated by developed countries (about two-thirds), although the share of developing countries is rising, mainly based on growth in emerging countries such as China, India, Russia and Brazil.
Most internationally traded commodities are physical industrial goods, such as manufacturing (the largest share), minerals, energy, and agricultural products. Except for transportation and travel, other services such as communications, business and cultural services are less internationalized than physical merchandised goods. While services constitute about two-thirds of world GDP, their share of international trade is probably no more than one-third. The experience industries and international trade in experience goods are included in these numbers. Roughly, total economic values created by the experience industries account for 10 percent of global GDP and 5 percent of international trade (see conclusion). The majority of this value creation and trade is based on developed countries, mainly USA, Western Europe and Japan (about three-fourths). Even within experience industries, export rates vary. As a consequence of the US global dominance, most American experience industries have high export rates, whereas for example German and Japanese (except video games) experience industries first and foremost are based on domestic markets.
TABLE 1 World Population and GDP Regional % Shares, 1950-2015
Source: Angus Maddison (2003). The World Economy: Historical Statistics. Paris: OECD. CIA (2000-2007). World Fact Book 2000-2007: www.cia.org. US Census Bureau (2007). International Statistics: www.census.gov.
Technology
Television and radio, telephones and computers have been around for quite some time and are found in virtually all households of developed countries and are widely used in emerging and to some degree poor countries, especially television. Since the mid 1990s, a new set of digital technologies are spreading rapidly, however (Table 2). The Internet, broadband, and mobile phones are changing many aspects of current societies, clearly having an effect on all experience industries.3 In developed countries, the great majority of households and companies have access to the Internet and soon the majority will communicate by way of broadband, allowing for easy transfer of movies, music and other capacity-heavy content. Mobile phones are everywhere, and in developed countries even children have cell phones. Furthermore, the digitization of any kind of information and communication, including all business processes and all entertainment content production, establishes the basis of an online world.
The accelerating introduction of online and mobile technologies and broadband to secure high capacity communication influence virtually all segments of the experience economy, including tourism, sports, media and entertainment, such as television, radio, newspapers, advertising, music, films, and games. Therefore, new technologies make up a dynamic driving force of the experience economy. Of particular importance is the accelerating spread of broadband access and the ubiquitous mobile phones that are including people in emerging and even poor countries in global communications networks. In addition to television and computers, access to Internet and mobile phones are about to be part of most households of the world.
TABLE 2 Global Subscribers to Internet, Broadband and Mobile Phones in Millions, 2000-2010
Source: PWC. Global Entertainment and Media Outlook 2006-2010. Internet World Stat: www.internetworldstats.com. International Telecommunications Union (2007). The Information Society: www.itu.int. Numbers are rounded.
The 2000s started the revolutionary transformation from an age applying many additional technologies such as television and computers to an emerging era of virtual relations making information and communications online united through pervasive digitization. By way of the Internet and increasingly the mobile phone, consumers are given direct access to all market supplying industries. This has great repercussions within the business world seeking to adapt to changing demands and secure direct distribution channels to consumers. Furthermore, consumers are becoming more demanding and individual in their demands. They want something special and often to be on their own. Armed with the new digital, mobile and virtual technologies they are able to enforce their will.
Individualization
On the demand-side, consumers are not only becoming more demanding and resourceful. The rapidly changing nature of modern societies has also changed the lives and mentalities of present day people.4 By way of globalization as well as the increasing focus on knowledge and the revolutionizing breakthrough of new technologies, the individual human being has become the central actor of modern societies. Companies and markets depend on the competences and choices of the working force and consumers on the one hand, whilst on the other hand, people have become individualized in their approach to work and everyday life. By individualization is not simply meant the spread of a free-market individual, although this may be considered one part of the changes taking place. The dynamics of modern societies has created a new and active individual personality. Human beings are valued on the basis of their individual competences and they value themselves on their own capabilities and act accordingly.
During the past few decades, this individualization process has taken hold of people in developed countries. Traditional social structures and links, such as classes and families, have been replaced or reduced in importance by individually created families and groups of friends and professional networks on the one hand and, on the other, a new set of institutionalized structures in business and state that has taken over many outsourced functions of family life. What is left is a resourceful, demanding, and individually acting human being seeking to fulfill himself in a world of many opportunities that are structured by the framework and dynamics of global and technologically based business. The identity of a contemporary individual is not a given thing. It is a matter of selection and creation, and therefore, it is a life-project of each person. Making use of the many opportunities and products of the experience industries is an important part of the self-driven culture of modern human beings. That makes experience industries expand.
Authenticity
Consumers want experiences, but not just any kind of experience. The more contrived and fast moving the world seems, the more do people demand what is real. Today, they look for authentic experiences. This is the message of Gilmore and Pine’s new follow-up book to their successful book on the experience economy.5 Because people have got used to a staged world in tourist attractions, cafés, media, entertainment and other experience sectors, they upgrade their demands. They want quality and true experiences that conform to their own self-image. No longer will they accept fake experiences. The demand for authenticity is not limited to specific segments of consumers. It is a general trend that includes eventually all consumers. Craving for authenticity may be considered part of a broader trend, too. Social responsibility in business and organizations in dealing with employees, customers, sub-suppliers, authorities, and other stakeholders as well as consciousness of the environment are other examples of a general trend among people and consumers that demand quality and honesty in all aspects of an experience and any product, for that matter. As man is a social animal, authenticity