New products

Turn to the customer experience to create new products and revenue models

Eloise Liley is Co-Planning Manager at TBWA Melbourne

Culture remains the greatest threat and the greatest opportunity for businesses today. Riding these lasting changes can be the best antidote to incremental growth, as companies must constantly adapt in order to remain culturally relevant to their current and future customers.

As we all know, in part thanks to the two big Cs – Covid-19 and climate change – we are going through a period of major cultural upheaval. This creates an inflection point for the company that has not been seen in decades. With that comes plenty of opportunities for Australian businesses to reset post-lockdown restrictions that have dominated much of the east coast.

Much of what we do in the creative industry is to create or leverage these cultural shifts on behalf of our clients. Advertising agencies can guide brands to think beyond traditional promotion and pricing levers. Beyond the sole area of ​​communications, towards new revenue models, products and customer experiences.

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In business terms, we can go two ways: high volume or high value.

In a high volume model, we may choose to seek revenge on the pandemic for the time we have wasted. Giving people more opportunities to live a lifestyle rich in experiences and high consumption through the products and services we provide.

Alternatively, in a high value-added model, we can choose to consolidate and reinvest in areas that provide the greatest value to clients. Value in Australia is often synonymous with “cheap”. In this case, however, we must regard a high value as great joy. A more sustainable path to meaningful experiences and products that meet needs and wants so well that we will need them less often.

The “Future of” series from our cultural intelligence unit, Backslash, shows that, depending on the industry and company in question, both models have merit in our most important sectors: tourism; finance and retail.

In the pursuit of escape, we avenge ourselves for lost time by traveling with more fervor and self-indulgence. High-volume tourism responds with new hedonistic experiences. In May, Qantas made headlines when its Supermoon scenic flight sold out in under two minutes. Fast forward to now and sales for 2022-2023 luxury cruises to Antarctica are booming. According to Airbnb, searches for unique island vacations increased 160% (compared to 2019).

Qantas Supermoon flight.
Qantas Supermoon flight.

Rather than going to these extremes, high-value tourism turns in on itself. Many Australian travelers are paying renewed attention to their minds, bodies and local heritage. Wellness tourism is now a $ 735.8 billion global industry. Routes designed around emotional states, nature retreats and sought-after dining experiences are becoming more popular as we seek transformative experiences with longer term benefits.

Tourism providers have the precious opportunity to reconnect Australians to the local culture, combining well-being and local education. For example, in my home state of Tasmania, the award-winning Wulkalina Walk offers a three-day walking tour that provides an authentic immersion in Aboriginal culture, food and language.

In the personal finance industry, the volume model is most evident in the latest buying innovation – buy now, pay later (BNPL). Led in Australia by Afterpay, BNPL embodies a high experience, high consumption lifestyle by allowing us to buy what we want, when we want – not necessarily when we need it.

Buying Now Paying Later has changed the way we shop.  Photo: NCA NewsWire / Nikki Short
Buying Now Paying Later has changed the way we shop. Photo: NCA NewsWire / Nikki Short

In the values ​​camp, there is a greater desire for a more open and individualized conversation about money. After the economic upheavals of the past 18 months, young Australians do not want a one-size-fits-all approach to their finances. They want open, educated conversations about their money with people they trust. Just search for #personalfinance in TikTok to see the opportunity here.

However, arguably the latest and greatest example of high volume to come is in retail. It is well known that one of the biggest benefactors of global blocks is the highly transactional online shopping giant, Amazon. As Australians entered their first lockdown in 2020, the online giant’s sales doubled.

Some, however, do it differently, creating a high added value model that is thus more joyful. Subscription models are on the rise in grocery, skin care, and even clothing. Anyone who doubts their viability should just remember that Australian darling Who Gives a Crap got its followers to hit the mainstream of society and refrain from getting involved in the infamous toilet paper war.

So what does all of this have to do with the advertising industry? Basically, advertising is about combining the power of culture and creativity to provoke different ways of thinking. The nature of the client-agency relationship means that together, we are in the best position to generate disruptive growth for our economy.

By learning from these examples, we can look beyond the realms of advertising and discover new revenue models and new products throughout the customer experience.

Eloise Liley is Co-Planning Manager at TBWA Melbourne.

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