The Experience Economy is Here

In 1999, Joseph Pine and James Gilmore offered a radical idea of an emerging economy that redefined what it meant to connect with customers and build loyalty. Though the world has changed in unpredictable ways since, the idea of staging experiences is now more relevant than ever.

“Economists have typically lumped experiences in with services, but experiences are a distinct economic offering, as different from services as services are from goods.”

Named the Disney of this now widely accepted Experience Economy, Meow Wolf provides immersive experiences through experimental retail to challenge the status quo of customer experience. After hearing Co-Founder and Director, Vince Kadlubek, speak about the impact of this economic evolution and how it affects strategy, design, and customer-centricity in modern business, we reached out to learn more about his perspective. What follows is a passionate discussion about consumer expectation and reveals mind-bending lessons for all businesses that don’t fulfill a utility.

TBD: Before we get into the main topics, thought we’d start with a softball and ask how you answer the question: what is Meow Wolf?

VK: That’s a softball? No, I mean I don’t want to have a canned response for Meow Wolf because that would mean that we’re a canned company. I purposely stayed away from scripting a response for that reason. I guess I’d say Meow Wolf is an artist and an art project, as well as a business that supports the artist and the art project. Or more directly, Meow Wolf the business is the art project and Meow Wolf the art project is the business.

We produce large scale interactive, immersive storytelling experiences, but that’s just one expression. That’s what we produce. Really, what we’re trying to do is inspire creativity in people’s lives in hopes that the imagination may transform their world. That can be seen in all sorts of different expressions, but right now the expression that is the most impactful and the one that we have the most business case around is permanent, immersive exhibitions.

TBD: There are two compounding concepts that you’ve spoken about worth digging into. Since they will naturally overlap each other, let’s start with your notion that “all humans are scientists.” What do you mean by that?

VK: When we enter the world, it’s fully discoverable. It’s fully unknown and explorable. Starting with childhood, it’s like everything becomes a scientific exploration. We’re playing with the texture of dirt. We’re experimenting with the sensation of fire. We’re learning physics through climbing trees. It’s a playful perspective, but it’s ultimately science. It’s learning about and defining our surroundings.

As we grow older the world moves from being unknown to being more and more known. People get stuck in a predictable life. Living inside of a fully known world loses excitement. The world is defined and there’s no room for the unknown. We stop being scientists.

To me, the courage of exploration and perspective of play the “scientist” brings is really the source of creativity. Of imagination, possibility, innovation, even joy and excitement. We all have it in us and we turn it off. We create structures to dampen and suppress our scientists for no other reason than a feeling of safety from the fear of danger.

Spontaneity, joy and discovery all have an inherent risk to them. We trade that for this sense of safety, a full sense of knowability. We become depressed in the process though feeling like the world is stuck. And we do this in our job, our daily routine, our eating habits, our route to work, our weekends, even the routine of watching TV. That’s the way that we make our world knowable. We also do this with ourselves and our relationships. It’s called creating an identity. I am Vince and Vince does this, and Vince doesn’t do this.

But inside each of us is still this scientist dying to get out. The courageous explorer that has possibility in front of them and can spark exploration into who we have the possibility of becoming.

TBD: That really speaks to this notion of an explorative reality you’ve referenced when stating, “predictability is no longer attractive.” Can you expand on predictability and is the opposite true, that unpredictability is desirable?

VK: Yes, it is! And it’s unique to our time. It goes back to this idea of safety and protection and creating knowability for the sake of survival. For 99.999% of human existence, we didn’t have technology. We didn’t have the world map. We needed to create predictability, or knowability, so that we could survive. The creation of memory was primarily a way of mapping for the sake of survival so that we could remember which bush the tiger was hiding behind, or which berry not to eat. Only in the last 20 years, has all of that predictability been placed into a shared external computer system known as the internet.

A really good example of this is the idea of getting lost. As recently as 1995 you could legitimately get lost. Like make a left, make a right. Oh shit. I don’t know where I’m at. The idea of lost doesn’t exist anymore. Because the internet’s got that covered. What it’s done is allowed for the brain to not worry about that shit anymore and not consider it useful or attractive. Now that we have the safety net of knowing that we can’t get lost, we’re ready to explore what’s out there again.

There’s another aspect to technology too in which the internet has become a place for the exploration of content and the exploration of information. I scroll through my Facebook feed, not because I want to find something that I already know, but to find something that’s unknown. And the same with Instagram. I want to see something that I haven’t seen before. We’re now being micro-programmed through little addictive properties to seek the unknown.

Sadly, when we look around in the real world, the Best Buy is the same exact Best Buy that I walk through in another city. The streets look the same, the restaurants, the buildings, it all looks the same. The physical world is so incredibly known and yet the internet is such an exploration of the unknown. That’s why so many people are buried in their phones. It’s not because the internet’s bad. It’s honestly because the physical world hasn’t caught up. It’s not as interesting and too predictable. If the world was less predictable, our faces would lift up and we would experience what’s in front of us. That’s proven at Meow Wolf.

The experience of the exhibit is unpredictable enough that it is interesting in and of itself. I think we see an increase in millennials going out into nature because it’s an unknown place. If you haven’t hiked before, you’re not exactly sure where you’re going to go or what it’s going to look like. Local restaurants are now much more desirable than your suburban, scaled Applebee’s or whatever. Even to the point of food halls, where you walk in and there’s fifty things in front of you and you don’t quite know which one to go to, or how to get to one or how the whole thing works. Things that are attractive now are almost purposefully confusing. I think the future of consumer-facing design is going to be about unpredictability and making space for the user to figure it out on their own.

TBD: What do you mean when you’ve spoken about providing “agency” to people? And what are ways to ensure you’re creating an environment for agency to exist?

VK: I’ve recently been saying that providing space for “agency,” or choice, is empowering to a consumer. That empowerment allows for and is expressed through exploration. Exploration is resolved in discovery. Discovery is the premium currency or deliverable for a consumer. Just to kind of tie all of this together, exploration and discovery can only happen within unknown environments. If you’re in a completely known environment, then there’s no such thing as exploration and discovery.

TBD: How far do you believe the average consumer is ready to be pushed? In what context?

VK: When we opened the house in 2016, we weren’t anticipating moms and dads from Kansas, Oklahoma, and West Texas. We thought that those prepared for this were the fringier, freakier, art goer, burning man type. That wasn’t the case. I think the reason why our numbers are what they are and the reason why people are so attracted to what Meow Wolf’s doing as a business is because we’ve tapped into seemingly a need and desire in everyday humans. There’s no way ten years ago this would have been predicted and I think that it’s pretty far reaching. Social media and the internet have trained the vast majority of people to seek out new content.

TBD: Let’s be more specific. Do you think that you can do something from an explorative thesis in a grocery store? Or do you think that a utility experience is governed by a different set of rules?

VK: Ah, I see. That’s an interesting question. I haven’t quite thought about that, but as long as something is strictly utility, then it doesn’t demand creativity, or experience, or unknowability. Stores like Smith’s, Albertsons, and Walmart are all very predictable and as long as its utility, people do want knowability around it.

We are seeing this emergence of new retail, which is clearly going in the direction of feeling more chaotic with a more discoverable process. That’s a response to people buying shit online. We don’t yet have a solution for buying groceries online or at least it’s not widely adopted. Once it is, then I think the utility of buying groceries goes away, and continuing with location-based brick and mortar grocery will need to be replaced with experience in creativity.

TBD: Many people have compared Meow Wolf to Disney and in doing so asked how you’ve been able to build something so different. How much of that do you think is linked to it being grounded as an art exhibit?

VK: Because we are coming at this from a vantage point of “this is an art exhibit,” there’s a lot more room in both the creation and and the experience of it. To be explored and to be exploratory. It’s the critical aspect of the word “art” and what art is. Art holds unknown. In its sort of definition, art is meant to be unpredictable with aspects that are explorable.

It’s the aspect of the business that is also very unknown for us. It’s hard to really quantify and put numbers on it. You can put numbers on things that are designed and are predictable, but when we get further into the gradient that is art, it becomes more and more unknown.

TBD: Without spoilers about the experience itself, in many ways, you’ve rewritten the rules of physical interaction for a consumer experience. How do you believe these could be adopted by and applied to other high traffic experiences (i.e. theme parks, events, retail, etc.)?

VK: I think that there are some basic design components that people can take into consideration. For example, one would be that people like to emerge from smaller spaces into bigger spaces. They also like to traverse from bigger spaces into smaller spaces. At any given time, having one main path is less desirable than having multiple pathways.

Another design element would be less wayfinding. Stop hitting your guests over the head with direction. Allow for a space or a function to be discovered, rather than told. That one specifically is interesting because it’s also the same rule that makes for good storytelling. Show, don’t tell. For instance, we don’t tell people to go through the front door of the House of Eternal Return. You don’t have to tell them that because the door shows them that and nowhere does it say “hey, the first step is to go into the house.” The door just makes it obvious that that’s the first step. People could choose otherwise.

TBD: Authors Joseph Pine and James Gilmore argue in their book The Experience Economy that “all businesses must orchestrate memorable events for their customers.” You’ve mentioned that you believe the power isn’t in the experience itself, but in how it changes you. Can you explain?

VK: The experience economy is definitely upon us and it’s going to continue to grow as more retail and utility goes online. What we’ll spend money on is experiences and you’ll have a whole array of them. The question is what’s going to differentiate one experience from another? What’s a good experience? It’s going to train people to only seek the experiences that make them feel different. Different on the way out than they felt when they came in – a transformative experience.

It’s the same as movies or any other storytelling experience. We want to engage with stuff that impacts or changes us. Where we’re a different person after we experience it. The way that we’ve discovered transformative experience is through presenting people with something that is recognizable – predictable or familiar – and then subverting that. The most notable moment that’s happened in the house begins with a fridge. It looks like a normal fridge in a normal kitchen, but what you expect when you open the fridge is very different than what is. It’s really important that the person makes the choice to open the fridge on their own and that no operational person tells them to do it.

It’s in that moment when someone realizes that this fridge is different than what the fridge is supposed to be. It allows for the world to be different than what the world’s supposed to be. And if the world can be different than what it’s supposed to be, then I can be different than what I’m supposed to be. I’m now feeling that sense of scientist, that sense of exploration and possibility. It’s where imagination and creativity lives. Basically, what’s in front of you can be anything. Your future is unwritten. It’s going to be your choice from here on out to define it. And that, to me, is the transformational moment. When everything that you thought you knew gets thrown out the window. Now, there’s all sorts of new possibility in your life.

TBD: Meow Wolf appears to be a world of chaos by design, but in being so, that means that there is rationale behind the choices being made. What is it that governs the decisions in how the brand expands beyond the exhibitions?

VK: We want to inspire creativity in people’s lives in hopes that the imagination may transform their world. With that in mind, spontaneity is a big part of that. The physical exhibitions act as monumental anchor points to a potentially larger experience.

Look at Pokemon Go and what they’ve done with overlaying a global map. If there were hundreds of potential real world activations – anchor points – that digital map could wrap itself around, anything’s possible. Meow Wolf could open bars, restaurants, hotels, hair salons, or totally fictional storefronts. It’s limitless. Whatever the story universe calls for, and within a story universe anything could exist. Right now, our focus is on opening our second exhibition, because each one is another major anchor point that drives the business, revenue, and profit.

The hope is, in the future, the Meow Wolf experience operating system will be populated with all sorts of creative activations. That it will be a platform for other third party creative activations as well. It doesn’t need to be first party. It could be space or it could be just the idea of platforming or labeling. That we become a platform that other brands and experiences can integrate with. An experience operating system that’s something a bit more user generated, more open source. But right now all of our focus is on opening Vegas and Denver.

TBD: The entire venture appears to be built on risk. Has there been anything that you’ve deemed too risky to pursue and what guides those decisions when the whole thing celebrates unbridled creativity?

VK: We have a lot of creative directors and artists who have to put that business and logistics hat on to make decisions that might be compromising to their fully creative self. They’re open and understand the need for structure, predictability, and reasonability. Then all the way on the other side, you have business people with their identity of being reasonable, predictable, and structured and they are asked to compromise and loosen up. To get a little wild, a little risky. It’s the collaboration between those two sorts of extremes. We don’t have anyone on the team that doesn’t share in the chaos and order. There’s no one who’s entirely order and there’s no one who’s entirely chaos. Almost everyone is within a gradient of the two and those are the people who drive the decisions. Even our board, who is filled with very accomplished, very predictable and reasonable minds, are all people who have this love for creativity and the adventure.

TBD: In the end, Meow Wolf functions as a business. How do investors and profit fit in and when have you had to alter plans because of them?

VK: Every project goes through a blue sky phase in which there’s a million brilliant ideas and we have to cut that down to 100,000. By the time we’re actually designing, it’s closer to 10% surviving. And that’s the most immediate way that business and finances come into play. You just have to scope the work or you end up with a rate of diminishing returns at some point. When between doing a billion dollar project and a $50 million project, the latter is going to be just as amazing. That sort of scoping happens quite a bit.

There are other things that are hard to justify. For instance, we want to activate our spaces with live theater and live performers and sometimes we do. We’ve justified it during peak times at the House of Eternal Return. It’s something that honestly we should do all the time, but it doesn’t make financial sense in our current business model. So, we have to cut back on things like that.

There’s a whole layer of digital interactivity and app development with AR overlay stuff that we’re chomping at the bit to do today as well. Despite wanting to do that today, there’s not a real business case for it yet. We have to open up Vegas and Denver so we can buy ourselves the ability to do some of this extracurricular stuff. It’s just patience and phasing. It takes a lot of being okay with a phase one and phase two.

TBD: This should be exciting for most people to learn, especially in business. There’s not a lot of comfort with the idea of exploration. Even when you try to break it into phases, suggesting that phase one can be exploratory and phase two can be the thing that gets implemented, people can struggle with that.

VK: Totally. You got it, but you’ve got to think in those terms. It’s also really important in the world of creative experiences, that phase one is remarkable. You never want to let your investors or your advisors tell you, “let’s just open and try it out on a small scale.” No. Phase one has to be remarkable and then you can phase in the rest of the stuff that’s on top of that. Do not compromise that first phase. Otherwise, you’re going to fail. You’ll never get to phase two or three because phase one failed after you cut it so badly, that nobody really liked it.

TBD: You think that appeals to both sides of the equation, both people that have to build it and the people that have to experience it?

VK: Yes. And it’s also advice for investors. It’s advice for people who care about the bottom line. Do not waste $5 million on a compromised product. Just spend the $15 million and become profitable. It might take you a little bit to get there, but you’re either going to be profitable at $15 million or you’re going to completely fail at five. It’s just good business to create something remarkable out of the gate.

TBD: Love the blunt nature of that statement. Like, why invest in a compromised product?

VK: That’s right.

To learn more about how Vince and the team at Meow Wolf continue to push consumer boundaries, visit the company website or watch their origin story told in a documentary film available on iTunes.

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