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Emotional Economy
Emotional Economy
• The book ”Emotional Economy” by Peter
Horn and Bo Bache, management advisor
and IT-director respectively, is focusing
on emotional values as the hardest
currency in future markets.
Emotional Economy
• ”Emotional Economy”
is written on a basis
of:
• General observation of
human behaviour.
• Societal and
technological
developments.
• Future challenges for
man and mankind.
The market in the Emotional
Economy
• ”Still more people
want to live several
lives within the framework of the one, they
have got.”
• ”The nummer of
different types of
lifestyles will grow
drastically. It will
cause a change in the
market and its
composition”
The dream of several lives
• ”Most of us have
already dreamt of
living several lives…
wearing a distinct
mask in each.
• This is what’s good
and bad - easy and
hard, when you want
to change track. From
one existence to
another…”
Capitalization:
Life wage
• Is the sum of your
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capitalizable value,
measured by
Personal
characteristics
Education
Business potential
Prognosticated
behaviour
A life wage is not for all
• World population will grow
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•
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with 3 billion people to nine
billion people in 2050.
Only the few will be
prosperous from our
standards.
Obvious global segmentation
- including in developing
countries.
More regional and global
unrest.
The hegemony of the USA is
diminishing.
A new political order is
emerging.
Lifestyle beats products
• Every customer wants to be
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•
•
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the main character in her or
his own reality show.
Providing the means of
staging every customers
individuality will be the
largest business in the world.
75% of consumption in the
West is not of vital necessity.
The individual desire the
emotional attention, that
disappeared along with
consecutive family life.
Companies that are able to be
family and create realtions,
will acquire the bulk of the
customers.
Mass marketing will survive with a new mission
• Forget everything you learned
about mass marketing - the
customers want 1:1.
• The target is constantly
moving, and its no longer
feasible to use bow and arrow
- only the auto-guided missile,
that automatically adjusts the
course.
• The customers couldn’t care
less about your or your
product or service, unless…
• Maybe the lesson is, that a
successful corporate strategy
in the future is a reflection of
the market - not an attempt
to influence it for own gain.
Women will take charge
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The female part of the Danish population is
50,5%.
In the business community 3% of executive and
board directors are women and 97% are men.
According to an American survey of Fortune 500
companies, businesses with female executives
have a 20-70% higher yield on net capital
compared to other businesses in the same
industry (see http://www.fremtidensledelse.dk).
The Norwegian government has decided that by
2005 all companies on the stock exchange are
required to have at least a 40% representation
of both sexes.
Danish companies could make an estimated 20
billion DKK higher profit, and tax revenue would
increase with 13,5 billion DKK p.a. with more
equality in boards and managements.
Women will take charge: Men will pursue new
barrier-breaking goals - and women will acquire
more competence in general management.
Market relevance: Marketing will be on the
conditions of each individual customer - no
matter the sex of the client. Marketing is not a
gender-related issue - it’s about competence.
The new challenge to
companies
• How do you make family
with 4 million customers?
• How do you build up
enough trust to be able to
get direct access to
customers pockets ?
• How do you gather the
mental fingerprints of your
customers - and with it
their history and future?
• How du you surmount
practical obstacles?
Customer capital value
• Is defined as the customer
capital value of a given
company, measued from:
• Customers emotional bond
through lifetime value
multiplied with lifestyle time.
A new estimation of value
•
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Can emotions be converted into an
economic measurement? Once the
debate was, whether the Earth was
flat or round…
In a few years corporate value will be
measured from the ability to acquire,
retain and extend emotional relations
with customers.
Customers will invest in relationsbased companies that are best at
dealing with ethical, moral and
financial demands and expectations on
a 1:1 basis.
Remember - that customers will buy
solutions or solution models in the
future - not finished products. And emotions may be at stake, but the
brain is still working.
Be the target: The customer is
the hunter
• New marketing is about making
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•
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the customer use her instinct for
hunting - instead of feeling like a
moving target.
The blind shall walk and the lame
shall see.
The shift in roles is significant,
and more marketing will focus on
Marcus Antonius: ” I’ve come to
bury Ceasar, not to avenge him…”
For that reason: Who’ll have a say
over the future developments in
the market? The market itself or
marketers? And who’s what
when?
Winners and losers
in an emotional
economy
• Strong brands with extended 1:1
customer relations will gain,
because....
• Traditional brands are necessary
in order to gain access to the
marketplace.
• New forms of marketing based
on surprising and abstract
thinking rather than graphic
design will set the agenda.
• It’s always the past that catches
up with you, never the future!
Get the full picture (in Danish):
http://www.foelelsesoekonomien.dk