Elgar original reference
Edited by Bernd H. Schmitt and David L. Rogers
Chapter 10: Some Issues Concerning the Concept of Experiential Marketing
Rajagopal Raghunathan INTRODUCTION The concept of experiential marketing, ﬁrst introduced in the work of Pine and Gilmore on experience economy (1997)1 and Schmitt on experiential marketing (1999), has gained signiﬁcant traction, both among marketing academics and among practitioners (for example, Pine and Gilmore, 1999; Schmitt, 2003). Experiential marketing is said to occur ‘when a company intentionally uses services as the stage and goods as props to engage individual customers in a way that creates a memorable event’ (Pine and Gilmore, 1997, p. 98). One of the major beneﬁts said to accrue from a well executed experiential marketing strategy is an increase in proﬁt margins: companies that oﬀer experiences – as opposed to mere products or services – the argument goes, are able to charge a higher premium for their oﬀerings because customers are willing to pay the higher prices. The case of Starbucks (for example, Pine and Gilmore, 1999, p. 2; see Figure 10.1) and Volkswagen Beetle (for example, Schmitt, 1999, p. 214) are often touted as exemplifying how a well executed experiential marketing strategy can bear signiﬁcant rewards. Without questioning the potential usefulness of pursuing an experiential marketing strategy for improving ﬁrm proﬁts (there is emerging empirical evidence for that; see Brakus et al., 2004), this chapter seeks to address three other, hitherto unanswered, conceptual issues concerning experiential marketing. The ﬁrst issue concerns the reasons underlying the evolution of the economies: proponents of experiential marketing provide little rationale for why the economies have...
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