Zusammenfassung Reading EXD:

I. Welcome to the Experience Economy - By B. Joseph Pine II and James H. Gilmore

How do economies change?

The economic progress can be recapitulated in the four-stage of the birthday cake:

1. Extract the commodities ( Flour, sugar, butter and eggs) - It represents the agrarian economy
(Mothers made birthday cakes from scratch)
2. Make goods (Pre-mixed ingredients) - It represents the Industrial economy (Mothers paid
more for premixed ingredients)
3. Deliver services - It represents the Services economy (Parents ordered cakes from the
bakery, even when they cost ten times as much as the packaged ingredients)
4. Stage experiences - The experiences economy ( Parents spend more money to have an
entire and memorable event for the kids)

The Cake illustrates what happens to our economy today, the progression of economic value.

● Experiences are memorable

● Services are intangible

● Goods are tangible

● Commodities are fungible

Experiences have emerged as the next step of Economic Value, they are as real an offering as any
service, good, or commodity. However, in today’s economy, many companies are dealing with the
challenges of realizing the benefit of staging experiences; they must deliver engaging experiences
that command a fee.

Experiences are personal, existing only in the mind of an individual who has been engaged on an
emotional, physical, intellectual, or even spiritual level. An experience derives from the interaction
between the staged event and the individual’s state of mind. Thus, experiences have been the heart
of the entertainment business.

An experience occurs 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.

An example of the experience-economy pioneer is Walt Disney- entertainment business.

Nowadays, the concept of selling experiences is spreading beyond theatres and theme parks, new
technologies encourage whole new genres of experiences. e.g.

● Intel (1996) had declared their products and services as more than simply personal
computers, they decided to delivery information and lifelike interactive experiences.
● Hard Rock Cafe, Planet Hollywood or the House of Blues are known as
“EATENTERTAINMENT”.
● Niketown, Cabella’s and Recreational Equipment Incorporated offer fun activities and
promotional events “SHOPPERTAINMENT or “ENTERTAILING”
Nevertheless, experiences are not exclusively about entertainment. In the travel business, The
company British Airways uses its base service the “commodity mind-set” - transporting people, the
travel itself, as the stage for a distinctive en route experience.

Experiences also are part of the companies, companies consist of people. Business- to business
settings also present stages for experiences, they create venues where they can sell their goods and
services or provide previous experiences where the customers can know what their products will
look like before manufacturing. Many companies invest in some entertainment companies to turn
ordinary meetings into improvisational events that encourage breakthrough thinking.

Still, companies do not sell experiences itself at least they charges a fee. They use events to create
loyalty with the brand or increase customer preferences for their goods or services. If they charge
admission they would act differently and begin to move forward into the experience economy.
Companies have two options to manage the border on the experimental, one of them, organize
events without admission fees or if they did charge and admission fee, they would force to stage a
better experience to attract paying guests, add demonstrations, showcases, and other attractions to
enhance the customer experience. Charging admission requires customers to pay for the experience.

The characteristics of Experiences

1. Before a company can charge admission. It must design an experience that customers judge
to be worth the price.
2. Design - marketing - Delivery (crucial - as good and services)

The four Realms of an Experience - four broad categories

Two Dimensions
 Customer participation

Passive participation: in which customers don’t affect the performance at all,e.g., who experience
the event as observers or listeners.

Active participation: in which customers play key roles in creating the performance or event that
yields the experiences.

Connection or environmental relationship, that unites customers with the event or performance.

● Absorption
● Immersion

Kinds of experiences

1. Entertainment events: Watching tv,

attending a concert (passive participation-
absorption)
2. Educational events: attending a class,
taking a ski lesson (active participation-
immersion)

3. Escapist experience: can teach

educational events or amuse entertainment but
involve greater customer immersion (active -
immersion)
4. Esthetic: customers or participants are
immersed in an activity or environment but
they themselves have little or no effect on it.
5. SWEET SPOT: Experiences encompass
aspects of all four realms.
Experiences have to meet a customer need, have to work and they have to be deliverable.

Experiences derive from an iterative process of exploration, scripting and staging - capabilities that
aspiring experience merchants will need to master.

Designing Memorable Experiences.

Five key experience-design principles

1. Theme the experience - envisioning a well-defined theme.

● “Eatertainment” restaurant - Hard Rock Cafe, Planet Hollywood or the rainforest cafe, you
know what to expect when you enter the establishment.
First crucial step: envisioning a well-defined theme. (imagination)

An effective theme is concise and compelling. It’s not a corporate mission statement or
marketing tag line.

BUT, the theme must drive all the design elements and staged events of the experience
toward a unified storyline that captivates the customer.

2. Harmonize impressions with positive cues

● Impressions are the “takeaways” of the experiences. To create the desired impressions, it
must introduce cues that affirm the nature of the experience to the guest. It must support
the theme.
● Even the smallest cue can aid the creation of a unique experience. E.G.” your adventure is
about to begin” - It sets the stage for sth especial. the cues make the impressions that create
the experiences in the customer’s mind.

3. Eliminate negative cues Experiences stagers also must eliminate anything that diminishes,
contradicts or distracts from the theme.
● “Overservicing” can also ruin an experience.
● eliminating negative cues creates a more pleasurable customer experiences

4. Mix in memorabilia - goods

Goods have been purchased for the memories they convey.

People spend a lot of money every year on memorabilia. In some cases, the price points are a
function less of the cost of goods than of the value the buyer attaches to remembering the
experience.

5. Engage all five senses. The sensory stimulants that accompany an experience should support
and enhance its theme. The more senses an experience engages, the more effective and
memorable it can be.
 II. Service-dominant logic: reactions, reflections and refinements
Robert F. Lusch and Stephen L. Vargo
1. Why a “Service-dominant” logic:

Vargo and Lusch argued that S-D Logic “services” is a goods-dominant (G-D) logic term. They use
singular “service” in S-D Logic to indicate a process of doing something for someone. On the other
hand, “services” in plural implicate “units of output” and it is consistent with G-D Logic.

S-D logic considers the relationship between service and a good, that means a good is an appliance
used in service provision, it is the common denominator of exchange. There is no good-vs-service
winner or loser. The “services” in S-D Logic recognizes the role of service marketing scholars in kayub
the foundation for a new dominant logic.

efinition of service: “ The application of specialized competences (knowledge and skills) through
deeds, processes and performances for the benefit of another entity or the entity itself”.

The idea of service being the foundational concept of exchange and marketing has some strong and
important normative implications. It implies a very different kind of purpose and processes for
marketing activity and for the firm as a whole:

To provide service to:

- stakeholders
- Customers
- Stockholders
- Employees
It appears almost directly to normative notions of investment in people (operant resources), long-
term relationships, quality service flows, and less notions of symmetric relations, transparency,
ethical approaches to exchange, and sustainability.

2. The resource- integration role of the firm and customers

According to Vargo and Lush they recognized the resource-application and resource-integration
function of firms and households. They added a FP9, that means, a ninth foundational premise: “
Organizations exist to integrate and transform micro-specialized competences into complex services
that are demanded in the marketplace”.

The authors realized that “resource-integration” role of the firm is equally applicable to individuals,
households and all economic entities are resources integrators. This application motivates and
constitutes exchange. S-D Logic’s concept is directly related to the concept of value creation through
resource integration. It matches with Gummensson’s 2006 “Ideas of interactivity and networks”

3. The nested roles of the co-creation of value and co-production

The authors had explained that after their publication about the term “co-production” which was the
focus of FP6 fit with G-D Logic term.

The change FP6 to “The customer is always a co-creator of value”

There are two components of value co-creation.

 ● The co-creation of value. However the authors argues with the concept form G-D Logic and
S-D Logic:
G-D Logic: this concept of value is something that is added to products in the production process and
at point of exchange is captured in value-in-exchange (price)

S-D Logic: Value can only be created with and determined by the user in the “consumption” process
and through use or as value-in-use. It occurs at the intersection of the offeror and the customer,
either in direct interaction. (Goods are distribution mechanisms for service provision).

● Co-production. It involves the participation in the creation of the core offering itself.
Both components make the consumer endogenous.

4. The central role of interactivity in value creation and exchange

Interaction and/or networks play a more central role in value creation and exchange.In S-D Logic
views marketing, the concept of interaction embraces the idea that value creation is a process of
integrating and transforming resources, that means, require interaction and implies networks, and
related to co-creation value is an interactive concept.

E.g. literature is Hakansson and Prenkert 2004, their notes indicate that “all exchange activities are
conducted in order to realize services”

The outcome of the business exchange activity is the services and the goal is to actualize the
potential services. The objective is to create value through the release of the services habituated
within resources.

One of the distinguishing features of S-D LOGIC in contrast to G-D Logic is the former’s treatment of
all customers, employees and organizations as operant resources. They are involved in the exchange
and value-creation processes.

● “Service-for-service” implies all parties value-creators and value beneficiaries. But the
implication is the distinction vanishes (offerer/customer and supply/demand).
According to Ballantyne and Varey, they built upon the dialogical prescription which calls for
communication between all network participants to co-create value through trust, learning and
adaptation.

5. The continuing need for refinement of an S-D logic friendly lexicon

Words (and distinctions) like producer and consumer, goods and services, demand and supply, etc.
carry very specific connotations and an implied logic that are often incompatible with emerging
conceptualizations.

1. The connotations of the words are oblique, if not orthogonal to the ideas which are exposed
2. What it is trying to say is misunderstood.
The table below shows how the lexicon of marketing is transitioning:
Clearly, development of a compatible and fully reflective lexicon will be a major challenge in the
advancement of S-D Logic.

The conclusion of this article stated that S-D Logic is not complete. The main objective was to remain
the identification of and participation in an “evolving new dominant logic of marketing”. They
support their concepts apparently in divergent schools of thought that constitute the marketing
literature.

III. Value co-creation and co-destruction in the Airbnb sharing

economy
by Jeannette Camilleri and Barbara Neuhofer
 
About this paper:
 Research paper
 Qualitative online content analysis
 Extract Airbnb data
 Analyse guest reviews and host responses in the context of Malta (Airbnb has considerable
socioeconomic impact there)
 Malta´s Airbnb property reviews were identified in June 2016 (850 review posts)
 Analysed by means of “Nvivo 11 Pro” - used a six-phase coding strategy
 Study aims to adopt a holistic approach by exploring a spectrum of value creation practices
and emerging value formations in the context of the sharing economy
 
 Focus has shifted from products and services to experience economy and experience co-
creation
 Tourists search for emotional experiences; stay at properties which engage them on a
personal level
 Culture of "what´s mine is yours"
 Attracted consumers through convenience and lower prices
 Sharing economy platforms/websites: Airbnb, couchsurfing, HomeExchange, EatWithALocal,
Meal Sharing, Cookening;
  Airbnb symbolises a "collaborative lifestyle" - share and exchange time, space, knowledge,
experiences, culture, skills, money; guests create own personalised experiences with hosts
 Contributors to this development: need to feel a sense of "social connectedness",
environmental pressures and declining economy
 This leads to the development, that consumers favour the access to products and services
over owning these
 Millennials are more interested in authentic experiences
 To attain value, "value propositions" are needed, from one actor to another
 Value resides not in the object of consumption, but in the experience of consumption
 Value co-destruction: incongruence between actors could diminish value (involuntarily or
intentionally), seemed to occur mostly due to negligence from the host´s side;
 Value does not pre-exist, but emerges through distinct social practises, if and when a set of
operant and operand resources are integrated
 Value co-recovery: incongruent practices causing value co-destruction could become
congruent, resulting in a possible outcome of "value co-recovery"
 Value co-reduction: practices starting in congruency and ending in incongruence might
lead to "value co-reduction”
 
Findings:
6 dominant social practices that characterise the Airbnb sharing setting:
 "welcoming" - referring to the first physical encounter; e.g. picking them up, arranging
transport, meet them at accommodation, provide food and drinks, provide local advice;
 "expressing feelings" - positive feelings, emotions and impressions, hoping to return,
complain about being treated as foreigners;
 "evaluating location and accommodation" - convenient location, quiet place for relaxation,
avoid tourist locations, more authentic experience, local´s friendliness, noise, lack of parking
spaces, guests could not find the location, cleanliness, WiFi connection, air conditioners and
heaters;
The accommodation was a value co-creating resource if "all that was needed" was there, if
prior expectations were met or exceeded and if the place fit the description.
 "helping and interacting" - showing guests around, sharing meals;
 "recommending" - good value for money, guests recommend host after their stay;
This shows, how critical electronic WoM is for potential guests and hosts alike.
 "thanking" - demonstrating appreciation towards their hosts, thanking them for everything;

- In some cases, hosts react by trying to clarify misunderstanding or explain that guest´s
expectations were too high
- Value can be created or destroyed during encounters
- Findings demonstrate, that hosts can act as value co-recoverers of problems, issues and
inconveniences
- Airbnb:
o develop a better understanding of how guests and hosts interact
o which practices occur
o how value may be co-created or co-destroyed
o attempt for hosts to recover the situation in case of service errors
- This research:
o Aimed to contribute to a better understanding of value co-creation and co-
destruction within the sharing economy
o Develops a comprehensive theoretical framework of “Airbnb Value Co-Creation
Practises and Value Formation
o Adds several theoretical and practical contributions
o Addresses a major gap in the sharing economy domain
 o Maps out in detail what specific guest-host practices lead to value co-creation, co-
destruction, co-recovery and co-reduction outcomes
o Provides an understanding what guests seek, when choosing to stay at a location
through this platform
o Recommends accommodation providers to implement strategies that foster co-
creation activities with guests and enable a “real” authentic experience

IV. Aspects of a Psychology of the Tourist Experience

by Svein Larsen

- Some of the conceptions (literature on experience and various concepts pertaining to specific
experiences) are too ambiguous
- This paper presents a threefold idea for the phenomenon of the tourist experience
- Experiences:
o Are influenced by expectancies and events
o they remain or are constructed in the individuals´ memory
o they are forming the basis for new preferences and expectancies
- field of tourism experiences is under-researched
- Some claim: “interaction of the individual tourist with the tourism system is fundamental in
the construction of the individual tourists ‘experience”
- In this article: “assumption, that tourist experiences may be considered to be psychological
phenomena, based in and originating form the individual tourist”
- This paper makes an argument for a disciplinary study of one aspect of tourism research –
“the study of the tourist experience”
- Tourism experience is a general psychological process

- “Erlebnis” – tends to signify immediate participation or consciousness related to specific

situation, “here and now” fashion
- “Erfahrung” – connotes the accumulated experiences in the course of a time period, the
individual undertakes, goes through or accumulates
- Tourist experiences concern both of these connotations

3 stages in the travel process:

- Planning process (the individuals ‘foreseeing of tourist events through expectancies)
o Principle of reinforcement (tendency of people to repeat enjoyable experiences and
avoid experiences that do not bring enjoyment)
o Study by Wirtz:
 People expected more positive outcomes of the tourist trip than they
actually experienced
 Tourists’ level of expected negative and positive affect were significantly
higher than the online negative and positive affects reported by the same
individuals while on tour
 Respondents predicted higher degrees of negative affects than they
experienced while on trip
 Explain findings with the general tendency in humans to overestimate the
intensity of affect in both directions
o Worry = individual´s attempts to engage in mental problem solving on issues where
the outcome is uncertain but contains a possibility for negative results; type of
thinking related to the future and to future´s uncertain outcomes
 o Subjectively perceived risk connected to visiting, or travelling to various areas will
inform potential tourists about which destinations to choose

- Actual undertaking of the trip (events during the trip)

o Perception
 The use of previous knowledge to gather and interpret the stimuli registered
by the senses
 Influenced by motivational and emotional states
 Conditioned by the individuals ‘personal values, opinions, worldviews,
attitudes and self-perceptions
o Peak and end effect of affective experiences: experiences are evaluated by just a
few moments, namely the peak and the end

- Individual´s remembering of these tourist events

o Tourist experience is an ambiguous social scientific construct
o When tourists are asked about their holidays, they do refer to experiences –
experiences are memories
o Semantic memories – general facts and knowledge
o Episodic memories – referring to personally experienced events
o People can recall events that stand out
o “flashbulb” memories – extremely vivid, long lasting memories for surprising
significant events
o Outstanding events suffer the same memory decay that other events do
o People tend to be more confident in the accuracy of memories of outstanding events

Findings
- A tourist experience is a past personal travel-related event strong enough to have entered
long-term memory
- The tourist experience refers to highly complex psychological processes

V. Conceptualising technology enhanced destination experiences

Currently there are two major paradigm that are drastically changing the nature of experiences,
the understanding of which is crucial for destinations to create successful experiences in the future.
Experiences are transforming as (a) consumers now play an active part in co-creating their own
experiences and (b) technology is increasingly mediating experiences.

In a market where global competition has turned products and services into commodities,
competitive advantage = by reducing the substitutability of offers and providing consumers with
unique and memorable experiences.

Traditionally, experience has been defined as a personal occurrence with highly emotional
significance obtained from the consumption of products and services.
 The individual, emotional, physical, intellectual and spiritual engagement in the experience is
significant enough to be translated into long-term memory.

While commodities are fungible, goods tangible and services intangible, experiences are
memorable. The progression of value is to stage experiences, whereby ‘staging experiences is not
about entertaining customers; it’s about engaging them’.

As a result, companies do not compete in terms of market price but rather in terms of the
distinctive value of an experience provided.

The creation of experiences has also traditionally been treated as a one-directed approach,
meaning that experiences are created by the company for the consumer.

In recent years, society has undergone a transformation towards the centricity of individuals and
their human experiences. Consumers have become increasingly informed, active and powerful which
has induced a major change in the industrial system. This has led to the emergence of a ‘‘ prosumer
society’’, reflecting the notion of consumers being actively involved in both the process of
consumption and production.

Co-creation builds on this very principle and puts the focus back on consumers, their respective
needs and wants and the question of how companies can meet these.

One of the most far-reaching changes to society in the 21st century is the proliferation of information
and communication technologies (ICTs).

ICTs, by accompanying the tourist with any device, anywhere, anytime, are dispersing interactions by
introducing new possibilities to co-create experiences everywhere along the value creation system,
i.e., the whole customer journey.

ICTs support tourists throughout various activities, such as preliminary information search,
comparison, decision making, travel planning, communication, retrieval of information and post-
sharing of experiences. Depending on their respective needs, tourists employ a wide range of tools,
such as websites, travel blogs, recommendation systems, virtual communities or mobile technologies
to facilitate and enhance these actions.

It has fostered the new prosuming tourist, who is more knowledgeable and empowered in the
search for experiences and extraordinary value.
With technology in use, tourists have transformed from passive recipients to connected prosumers
co-creating their experiences in a technology enabled destination environment.

Web 2.0. enables online consumers to become co-marketers, co-producers, and co-designers of their
service experiences by providing them a wide spectrum of value.

For destinations to succeed it is critical to fully understand (a) who is involved in the co-creation of
experiences and value, and (b) where and how experiences can be co-created in the context of a
destination.

Tourists do not experience the destination space in isolation but rather interact with tourism
suppliers, their friends and families and other co-consumers in a dynamic experience co-creation
space. Thereby, co-construction of destination space occurs when tourists are co-creating on a
collective level through tourist practices, performances, events, activities or learning experiences
they are participating in.

The space should constitute an interactive forum for multiple players, with the tourism consumer as
the focal point of the experience, who cocreates with tourism suppliers and co-consumers the
experience, value and space in the specific context of the destination.

The tourism experience has been widely represented as a multi-phase phenomenon in terms of its
chronological or temporal nature. The experience is not restricted to a single service encounter on-
site but consists of a pre, during and post travel stage.

1. Pre travel: virtual experience co-creation,

the pre-phase is characterised as an actively involved and socially intense phase.

Social media, such as Facebook, YouTube or TripAdvisor, allow individuals to experience the
destination and live experiences of other consumers, by engaging with both their own social circles
and unknown co-consumers.

The embodiment through avatars enables tourists to experience the destination in both the pre- or
post-phase of their holiday.

The pre-travel phase is crucial as tourists explore, seek inspiration and interact with the destination.

2. On-site destination: physical and virtual experience cocreation. The actual travel phase, often
referred to as the on-site phase in the physical tourism destination, is determined by the tourist
being on the move. Different technologies come into use while the tourist is on the move, in transit
or at the destination.

3. Post-travel: virtual experience co-creation. In the post-travel stage, technologies help tourists
enhance the experience through recollection and remembering previously undergone travel. Social
media play a critical part in encouraging tourists to interact and share their experiences online.

The post-travel stage is therefore critical for destinations to engage with former tourists in order to
co-create their lived experiences.

While reconstructing past experiences, this stage simultaneously demarcates the beginning of the
dreaming stage of the next travel, where ideas and inspiration for future holiday destinations are
gathered.
The key contribution of this model lies in (a) the recognition of an extended destination experience
co-creation space (pre, during, post travel), (b) the distinction of two levels of co-creation (physical
and virtual co-creation) and (c) multiple levels of engagement, i.e. the destination with the tourism
consumer, tourism suppliers, the social network, and co-consumers.

VI. Toward a Theoretical Foundation for Experience Design in Tourism

There are three different ways how the term design has been approached in recent business
literature:

 design as a unique proposition characterizing products and services,

 design as a state of mind (i.e., design thinking),

 design as a process that governs the creation of new products and services (i.e., designing).

User experience design (UXD) approach in computer and information systems research referring to
user-centered design for a given computing system, which may include user interfaces, graphics,
physical interactions, etc. Typically, UXD involves traditional methods within human–computer
interaction (HCI) research to evaluate experiences with computing technology as perceived by the
users.

Ralph and Wand (2009) identify six classes of object in designing:

 physical artifacts (e.g., hotels, resorts),

 processes (e.g., business workflows),

 symbolic systems (e.g., programming language),

 symbolic scripts (e.g., essays, software),

 laws, rules, and policies (e.g., building code),

 and human activity systems (e.g., universities, hospitals, artistic productions).

Three areas of design research as a part of designing:

(1) empirical design research to explore and define users’ needs,

(2) research as part of iterative prototyping of forms and experiences to determine their usefulness
and usability,

(3) research applying theoretical or critical design approaches as interventions into cultural discourse
and practice.
Designing services is a matter of looking into services from the outside-in perspective starting from
the customers.

Experience design is broadly defined as a practice of designing products, services, processes, events,
and environments with a focus on the quality of the user experiences; a deliberate, careful creation
of a total experience for customers.

In the context of tourism, it is argued that designing for tourism experience is not a matter of
creating a tour package or staging a theme park, it is designing the experiences tourists will have with
the tour and at the park, which typically include experiences associated with the senses, cognition,
emotions, affect, and other values and situated in different tourism contexts.

Hence, it is important for designers to empathize with the end users, to identify with their thoughts
and feelings, their motivations, emotional and mental models, values, priorities, preferences, and
inner conflicts, to be able to gain intimate insights and understanding into their experiences.

Human-centered approach in product design typically bases its theoretical underpinnings from
psychology, anthropology, and social and behavioral sciences to understand users’ needs,
behavior, and activities resulting from their use of and interactions with the products.

A comprehensive review of literature in different disciplines as they apply to experience design point
toward these three fundamental approaches:

 the human-centered approach to designing,

 the designing as iterative processes,

 the holistic experience concept as an outcome of designing.

HCD and iterative designing process require participatory design (i.e., codesigning), where every
stage of designing includes an active engagement of end users (i.e., tourists) together with designers
and other stakeholders (i.e., management, employees, locals, etc.). At the intersection of iterative
designing process and holistic experience concept lays the integrative design research where
explorative, generative, and evaluative research processes are essential parts of the entire
experience concept development process.

The designing and design research process:

A meta-concept of tourism experience that include the strategic, meaningrevoking tourism
experience propositions transformed -> core and peripheral experiences, supported by the
storytelling of these experiences (i.e., the meanings and values of these experiences as they are
situated in the society at large).
The operational concept of tourism experience should pay attention to interactivity, which include
interactions between tourists and the physical elements of the destinations (i.e., interactions with
objects and concepts associated with destinations), interactions with the social elements of the
destinations (i.e., interactions with other tourists, locals, tourism employees, and other social
networks associated with destinations) and interactions with the mélange of media associated with
the destinations (i.e., interactions with mass media, marketing materials, etc.)
 VII. What triggers transformative tourism experiences?

Triggering episodes tend to occur at the end of travel, to evoke intense mixed emotions and
heightened cognition, to engender the sense of transiency, demarcation, and connection to
something grand. It furthermore appears that when triggers are co-created by tourists, an
extraordinary experience is a result; transformative experience, however, occurs when
triggers are also made sense of.

Transformative experiences are those special extraordinary events that do not only trigger
highly emotional responses but also lead to self-exploration, serve as a vehicle for profound
intra-personal changes, and are conducive to optimal human functioning. Alternatively,
Kirillova et al. (2017b) found that transformations represent positive and enduring changes
in tourist existential authenticity, or a state of being in which one is true to one’s values that
are driven by an enhanced sensitivity to existential angst, or the dread associated with the
ultimate meaning of life and death.

While travelling, tourists are usually free from routine obligations and are allowed to act
upon their own agency as opposed to following the social order prescribed by the society. A
transformative tourist experience is therefore one that results in enhanced existential
authenticity, sustained even after a trip (Kirillova et al., 2017b).

Important concepts:

 “Peak” experience” - Laski (1962) defined ‘peak’ experiences as an ecstatic moment,

‘characterized by being joyful, transitory, unexpected, rare, and extraordinary to the
point of often seeming as if derived from a preternatural source’. The idea of ‘peak’
experiences was proposed by Maslow (1959) to signify the moments of highest
happiness and fulfillment. Maslow postulated that during these moments, people
experience so-called Cognition of Being, or B-Cognition, that is the state of
consciousness in which one is ‘more acutely and penetratingly perceptive’ to the
outside world, able to attend to the experience in a non-evaluative manner and see it
as encompassing the entire universe. Maslow also thought that ‘peak’ experiences
are characterized by disorientation in time and space and they are always positive
occurrences that suddenly happen to people and cannot be commanded. An
important aspect of the ‘peak’ experiences, according to Maslow, is a complete yet
transient loss of fear and inhibition, allowing an individual to feel ‘being alive’.
  Extraordinary experience - ‘highly memorable, very special, emotionally charged and
potentially life altering’ (p. 38). An empirical study by Arnould and Price (1993) of
white water rafting experiences identified three dimensions of extraordinary
experiences, namely:
 a deeply felt connection with a physical environment;
 a profound connection with fellow travelers;
 personal growth and renewal.
 Transcendent experience - a similar concept described as a moment of the ultimate
subjective awareness, intense happiness, freedom, and a sense of harmony with the
entire world (Williams & Harvey, 2001). Reflecting its etymology, the term also refers
to ‘a perception that human reality extends beyond the physical body and its
psychosocial boundaries’ (Watson, 1991, p. 362). Williams and Harvey (2001)
identified two most significant types of transcendent experience:
 those high in fascination and novelty, termed as Diminutive Experiences;
 those that are highly absorbent and moderate in novelty, called Deep Flow.

Levin and Steele (2005) distinguished between green and mature types of transcendent
experience. The green type is transient, involves pleasure, and is often ecstatic. Green
experiences may vary in the degree of intensity but always involve unusual affective
phenomena. The mature type, on the other hand, is longlasting and associated with more
enduring feelings of serenity and equanimity. It is ‘likely to be experienced as a self-
transformational shift in one’s consciousness or spiritual perception’ (Levin & Steele, 2005,
p. 90).

Triggers of “peak experiences”

Maslow and Laski found that classical music, sexual love, and art were the most frequent
triggers of ‘peak’ experiences. Williams and Harvey’s concluded that the intensity of
transcendence varied according to the dimensions of fascination, novelty, and compatibility
while Jefferies and Lepp found that challenging activities leading to accomplishing one’s
goals, spontaneity, outdoors, cross-cultural experience, and refection played an important
role in facilitating extraordinary experiences.

Maslow similarly proposed that when people are in a state characterized by the sense of
spontaneity, freedom, and naturalness, they are likely to get absorbed in the moment and
immersed in the surroundings. Along these lines, Farber and Hall identified the triggers
novelty, social interaction, solitude, perceived freedom, and the sense of connection with
nature derived from viewing scenic vistas. Encounters with wildlife were found to trigger
‘peak’ experiences in multiple studies therefore wilderness is further associated with
solitude and hardship, which tends to have spiritual significance (Williams & Harvey).

Transformation can be defined as a growth enhancing, irreversible change that is a

fundamental break with the past or current practices that requires new knowledge for
successful implementation. This is in line with Coghlan and Weiler’s definition of
transformation as an individualized process that leads to critical awareness of the old and
the new self, ultimately resulting in a new self-concept. Jointly, these definitions suggest that
intra-personal transformations may not always be obvious to outside observers because
they involve subtle reflection and re-evaluation of the content of knowledge, process and
premise of knowing as well as its relational component.

Transformation mandates a conscious effort on the part of an individual in a form of

meaningmaking. Mezirow further identifies three realms of meaning-making in a
transformative experience, of which psychological, which is related to the way people view
themselves and the world around, is the most critical for a transformational change to occur.

The idea of personal transformation is also related to the notion of epiphany, or a sudden
moment of insight. Such moments are thought to arise from a feeling of internal conflict,
anxiety, and overall emotional turmoil and to result in productive activities that lead to
sustained changes (Jarvis, 1996). Epiphany has also been described as a quantum change, or
the moment of transformation that feels sudden, distinct from everyday life, and
benevolent.

Miller and C’de Baca delineated two types of quantum changes:

 the mystical (epiphany) type is a transient state of consciousness experienced

without a person’s will and is joyful occurrence, colored by a sudden knowledge of a
new truth;
 The insightful type of quantum change centers on an insight. The effect tends to be a
‘reorganization of one’s perceptions of self and reality, usually accompanied by
intense emotions and a cathartic, even ecstatic, sense of relief and release’

Kirillova et al. (2017b) concluded that transformative changes are marked by increased
existential authenticity and anxiety which, although triggered during the course of travel,
usually manifest themselves after tourists return home.

The results of the study suggest that the triggering episodes tend to occur at the end of a
trip, strike as a surprise, evoke intense, often ‘bittersweet’, emotions, an acute realization of
transiency of the moment, and a sense of connection to something grand.

Participants reported that the moments of ‘epiphany’ occurred suddenly and usually close to
the end of their travels when they were involved in routine meaningmaking of their on-going
travel experiences. For example, Erica described her triggering episode as occurring at the
end of her three-month backpacking trip, in a food court of ‘a nondescript movie theater’ of
an unfamiliar Australian town where she found herself engaged in a very banal activity:
chatting with a person and ‘just connecting with a person that I realized that I could try to do
all these exciting things but what I really wanted was to be back with this guy [her
boyfriend]’. In such a way, It was not an impressive spectacle that left a mark on the
participants; rather it was a succession of seemingly random events that led to the moment
being experienced as a triggering point.

Considering that, in existentialism, emotions are considered as an equally valid mode to

understand the world as is cognition (Sartre, 1962), the affective aspect of the
transformative tourism experience represents an essential means of making sense of the
triggering episode. ‘Bittersweet’ emotions derived from discovering something new, a
feeling of being at a loss with this revelation, and intense longing to understand its meaning
were commonly depicted in the results. The sense of bittersweetness reflects more of an
emotional intensity than emotional ambivalence.

The main aspects of transformational experiences triggers obtained from the research:

 Emotional valence
 Emotion intensity
 Heightened cognition
 Transiency and demarcation
 Connection to something grand
 Circumstantial environment

In conclusion, the research showed that triggering episodes tend to happen unexpectedly
and closer to the end of one’s travels when participants firstly begin to doubt authenticity of
their of being. Kottler (2001) argues that propensity to such thinking necessities a certain
level of tolerance and openness to uncomfortableness and requires a qualitative
advancement in one’s receptivity to the new. Maslow (1959) also posits that individuals are
particularly mindful and perceptive when they experience the sense of spontaneity and
freedom. If we view tourism experience as a gradual process of liberation during which one
becomes attuned to his or her sensations, natural dispositions, desires, and emotions (Wang,
1999), it is thus a natural outcome that this degree of ‘readiness’ is likely to be achieved at
the end of one’s journey.

Factors that facilitate the occurrence of triggering episodes include awe-inspiring scenery,
novel culture, and connection to others. The first two were also identified by Kirillova et al.
(2017a) who showed that natural scenery and places with unfamiliar cultural cues were
linked to enhanced existential authenticity. Awe is known to encourage individuals to
discover and appreciate their sense of ‘self’ as well as to advance people’s capacity for self-
reflection and self-awareness (Leitner, 2007). Connection to others (either fellow travelers or
destination residents) were also previously identified as an essential ingredient of tourism
experiences leading to personal growth (e.g. Arnould & Price, 1993) yet in our research it
merely acts as a circumstantial element.

Mechanisms of transformative experience

Explanation: It appears that the transformative potential of an experience lies not in the
nature of its triggers or environmental settings per se but in the way tourists interpret these
serendipitous moments. In other words, a transformative experiences occurs when a trigger
as placed in a suitable environment is not only experienced but also is made sense of. The
researches argue that a transformative experience is an extended and enhanced version of
a ‘peak’ experience. Both experiences are contextualized in similar tourism environment,
with triggering episodes of comparable nature. The process of co-creation accompanies the
experiences as tourists’ bring their own perspectives and resources (e.g. pre-trip position in
the existential predicament, moods, personalities) to the co-creation process, which could
result in ‘peak’ (or extraordinary, transcendent) experiences and the formation of value. Yet,
co-creation by itself may not lead to transformations of identities, perspectives, or
worldviews, as documented in existing tourism research. A ‘peak’ tourism experience can
become transformative when triggering episodes are also made sense of in a way that is
personally meaningful to a tourist. Transformations may range from subtle to overt as they
are outcomes of an individualized process, which was illustrated through the existential
lenses in this research but can take on a variety of forms.

VIII. Exploring the essence of the memorable tourism experiences

This paper discussed what constitutes an experience that is especially memorable, and to
ultimately consider the difficult, yet highly important issue of how to facilitate MEs
(memorable experiences).

Tourism experience – “an individual’s subjective evaluation and undergoing (i.e., affective,
cognitive, and behavioural) of events related to his/her tourist activities which begins before
(i.e., planning and preparation), during (i.e., at the destination), and after the trip (i.e.,
recollection).’’

The central role of tourism planners is to ‘‘facilitate the development of an environment

(i.e., the destination) that enhances the likelihood that tourists can create their own
memorable tourism experiences.’’

Destination managers cannot directly deliver MEs to tourists since individuals recall
experiences subjectively and uniquely even though tourism planners may have provided
objectively equivalent services, events, and activities. Thus, it is our goal to understand the
underlying essence of MEs so that tourism planners can enhance the probability of
delivering to tourists those experiences that are special, cherished and truly memorable.

According to MacCanel, tourists are not easily satisfied by explicitly contrived events, but
rather, were in a ‘‘search for authenticity of experiences’’ by pointing out that ‘‘the concerns
of moderns for the shallowness of their lives and inauthenticity of their experiences parallels
concerns for the sacred in primitive society’. Cohen, although supportive of MacCannell’s
main position towards authentic experiences, argued that authenticity is fluid, or
emergenat, as cultures and societies change over time unlike the static, primitive state that
MacCannell implied. Cohen took another approach to understanding the tourism experience
using a phenomenology perspective and explained that travel motivations in and of itself do
not fully describe the experience-seeking behaviours of tourists. He defined a tourism
experience as the relationship between people and their total world-view dependent on the
location of their centre with respect to the society to which they belonged.
Cutler and Carmichael argued that ‘‘authenticity is understood as only being involved in the
tourist experience if this is what is being sought from the experience’’.

Satifactory experiences

A satisfactory experience can be perceived as ‘‘the congruence of need and performance’’

while dissatisfaction may be expressed as ‘‘the gap between expectation and experience’’.
According to Ryan, tourism planners must moderate the level of risk at a destination through
risk avoidance or enhancement policies in an attempt to satisfy tourists’ motivations.

Csikszentmihalyi introduces the concept of flow which emphasizes the balance between the
perceived challenges and risk of the task, and an individual’s perceived level of skill for the
task. An optimal level of flow will bring intense satisfaction marked by ‘‘a sense of
exhilaration, a deep sense of enjoyment that is long cherished and that becomes a landmark
in memory for what life should be like’’.

Many models that measure and predict tourist satisfaction is founded on the early work of
Noe based on the concepts of expressive and instrumental attributes. Expressive indicators
involve the act of the experience itself (e.g., swimming) while instrumental indicators act as
facilitators towards achieving that experience (e.g., pool). Instrumental factors, which are
related to cognitive attributes, create dissatisfaction if they are absent while expressive
factors, which are more related to emotions, contribute to satisfaction as they reflect the
importance of emotions in memory and event recollection. In this sense, satisfaction is an
attitude which embraces affective, cognitive and behavioural elements.

In a recent study by Uysal and Noe (2003), the authors investigated the indicators of
satisfaction in an outdoor setting, and concluded that both instrumental and expressive
factors collectively, as well as independently, contribute to overall tourist satisfaction.

Many scholars examined satisfaction of tourism service experiences and asserted that
different levels of overall satisfaction was due to subjective, emotional and highly personal
responses to various aspects of the service delivery.

Arnould and Price (1993) in their research of white water rafting experience, revealed three
key dimensions of an extraordinary experience:

 communion with nature

  communitas with friends, family and even strangers
 personal growth and renewal of self.

These three themes are together significant in explaining overall, positive satisfaction.

Managing Memorable Experiences

Pine and Gilmore defined four realms of experiences:

 entertainment
 educational
 esthetic
 escapist.

Escapist experiences involve ‘‘greater customer immersion...both active participation and

immersion in the experience’’. This coincides with Csikszentmihalyi’s (1990) concept of the
flow experience as well as Cary’s (2004) description of the serendipitous moment as the
moment ‘‘that simultaneously produces and erases the tourist-as-subject’’. Once this
moment passes and tourists ‘‘feel that they themselves have little or no effect on their
experience...like a tourist who merely views the Grand Canyon from its rim’’, the escapist
moment will transform into an esthetic experience.

Pine and Gilmore (1998) provided five key points for which they called experience-design
principles:

 theme the experience

 harmonize impressions with positive cues
 eliminate negative cues
 mix in memorabilia
 engage all five senses

Link between memories and experiences

Many studies have centered on the interpretation of experiences through the concept of
narratives. Narratives, defined as ‘‘knowledge structures that consist of a sequence of
thematically and temporally related events’’ subsume storytelling, the ‘‘anecdotes that have
a beginning, a plot and an end’’. Storytelling has emerged as a prominent type of narrative
designed to directly analyze consumers’ memories of their experiences.
In the tourism literature, storytelling has been used to analyze stories and themes in an
interpretative setting. For instance, researchers often prompt participants to recall specific
types of experiences (e.g., backpacking) in order to investigate the effects of the experience
on self-identity, or on the role of tourism developments such as service quality.

Advantages of storytelling in understanding tourist experiences can be attributed to several

factors:

 tourists create stories during their experiences and then present these stories to
others as memories of their trip
 stories told by others (e.g., service staff that tourists interact with) affect the overall
destination’s brand
 storytelling shapes memories and impressions of events over time (stories are stored
in and retrieved from one’s episodic memory and specific indices of stories such as
the location and individuals involved in the experience are not only the ‘touch points’
of narratives but they are also the event-specific knowledge of episodic memories
which are the basic elements of memory formation)

Storytelling acts to both consolidate and recover experiences from memory, and an
appreciation of storytelling provides listeners with a deeper understanding of the intricate
lives of storytellers and truly empowers researchers with a heightened sense

Memory work is now generally used to examine and identify consumers’ patterns of
experiences. Memory-work uses memories as the initial data as ‘‘the underlying theory is
that subjective significant events, events which are remembered, and the way they are
subsequently constructed, play an important part in the construction of self’’. This
qualitative method stresses the active participation of the individual, the collapse of the
barriers between subject and object of research, and the elimination of the hierarchy
between experimenter and subject such that the researcher becomes a member of the
research group and involves participants as co-researchers.

Mindlessness-Mindfulness

Mindlessness is ‘‘a single-minded reliance on information without an active awareness of

alternative perspectives or alternative uses to which the information could be put’’. When
mindless, individuals ‘‘act like automatons who have been programmed to act according to
the sense our behaviour made in the past, rather than the present’’. Familiarity and
repetition, as well as premature cognitive commitments (e.g., stereotypes) substantiate
mindlessness and impede individuals from paying attention to their experiences. Thus, a
mindless individual will not see the surrounding situation as a new source of information.

In contrast, mindfulness is ‘‘a state of mind that results from drawing novel distinctions,
examining information from new perspectives, and being sensitive to context...[recognition]
that there is not a single optimal perspective, but many possible perspectives on the same
situation’. Mindfulness is a function of novelty, surprise, and variety, and gives individuals
power over their behaviours especially in situations where they feel that they have an
opportunity to learn, control and exert influence. Mindfulness is associated with greater
learning and satisfaction within a recreation-based setting; for example, visitors in the
museum are more satisfied from an educational experience if they are presented
information. Overall, cues such as new or existing objects or sources of information (e.g.,
signs, brochures, displays, and pamphlets) must be present in an environment in order to
induce a mindful experience.

Memory Formation and Retention

Autobiographical memory is defined as the recollection of experiences from one’s own life
(Piolino, Desgranges, Benali, & Eustache, 2002). There is an important distinction between
the more general classification, episodic memory, and autobiographical memory.
Autobiographical memory is considered a specialized subset of episodic memory due to the
amount of self-referencing involved; that is, while general episodic memory can have a large
proportion of referencing that involves others, autobiographical memory primarily concerns
knowledge of the self in the past.

According to the models describing the features of autobiographical memories suggested by

Conway and Pleydell-Pearce, autobiographical memories have three main components:

 lifetime periods
 general events
 eventspecific knowledge
Lifetime periods form the basis of time with identifiable beginnings and endings albeit these
periods are often vague rather than discrete. For instance, individuals may reflect on their
memories as ‘‘when I was five years old’’ or ‘‘during the time when I was in England.’’

General events encompass both single (e.g. trip to Mexico) and repeated (e.g. daily strolls in
the park) events linked together by a common theme. Often referred to as mini-histories of
activities, general events represent vivid memories where an initial recollection of a memory
can cue the recall of a second, third, etc. memory forming an event cluster.

The indexing of these general event clusters form ESK (eventspecific knowledge) which is
based upon the recollection of highly specific single details. For example, precise details
could entail the actual words spoken by a tourist during a service encounter. Storing
numerous ESKs is cognitively demanding and links to general event structures are lost rapidly
unless they are rehearsed.

According to the results of the study, 4 dimensions were identified which represents aspects
of experiences that enable them to be particularly memorable:

 affect
 expectations
 consequentiality
 recollection.

With regards to affect, positive emotions and feelings associated with the experiences (such
as ‘‘happy/happiness’’ and ‘‘excited/excitement’’) were described by the majority of the
respondents as a critical component of their ME. Research has shown that positive affect
widens the scope of attention and increases happiness as well as psychological growth. It
also broadens exploratory behaviour and creates learning opportunities that confirm or
correct initial expectations. Furthermore, positivity produces more accurate knowledge
which becomes a lasting personal resource (Fredrickson & Losada, 2005).

Expectations were reflected in responses made specifically about the fulfillment of

intentions and/or descriptions of surprises encountered during the trip that was above and
beyond tourists’ planned agendas. Many respondents conveyed planning for the trip prior to
departure and explained that their expectations were often influenced by information from
third parties such as tour operators, and family and friends who have told them stories
about their experiences at the destination. Still, other respondents simply suggested that
their expectations were personally envisaged; that is, based on a basic understanding of the
destination, they imagined the mix of activities they would participate in and the level of
comfort at the accommodation, for example.

Consequentiality refers to responses that suggested some sort of personally perceived

importance from the outcome of the trip. This dimension includes four main sub-
dimensions:

 enhancing social relationships

 intellectual development
 self-discovery
 overcoming physical challenges.

In the first sub-dimension, social development, respondents noted that it was the outcome
of the interaction with others during the trip that was a significant factor in their MEs. This
included improvements in current friendships, development of new friendships, and
increased appreciation of family and relatives.

The second sub-dimension, intellectual development, represents the acquisition of new

knowledge of the destination. It involved many references such as learning the history, local
culture, way-of-life, natural physiography, and language of the destination. Intellectual
development at a novel destination was particularly frequent because almost every aspect
of the trip was a ‘‘fresh’’ and ‘‘an eye-opening, learning experience.’’

The third sub-dimension, self-discovery, represents permanent changes in respondents’

state of mind as a result of their tourism experience. They explained that their ME was: ‘‘an
eye opening experience that you learn more about the world and expand your perspective in
life. The memories of the experience will not disappear and will change the way you live
your life’’. Also, it was ‘‘an experience that emotionally affects your way of life that is a
catalyst for change and a transformation in beliefs.’’

The fourth sub-dimension was overcoming physical challenges. Respondents focused on a

progression in physical abilities by developing the skills and expertise needed to accomplish
challenges during the trip. Others described experiences that challenged them physically
such as ‘‘a tour to a place called Semuc Champey which included caving, tubing, hiking, cliff
diving and swimming. It was physically stimulating, basically crazy [and] allowed me to do
things I never have done before.’’

Recollection refers to statements made specifically about the efforts made and actions taken
by respondents to remember the tourism experience and/or reflect back on the trip.
Responses contained numerous references to ‘‘telling stories,’’ ‘‘showing photographs,’’ and
‘‘purchasing souvenirs.’’ Additionally, respondents explained that they want to ‘‘re-
experience the trip,’’ and ‘‘go back and rebuild the memory.’’ More interesting however, is
that these respondents often described their intention to revisit with individuals who did not
accompany them on their first trip; for example, many stated intentions to revisit with close
friends or their significant other since they experienced their original ME with family.

In such a way, recollection influences mediation which exists throughout the experiential
process and begins before, during, and after the trip. Meditation refers to the people and
processes that facilitate the tourism experiences of other individuals. When respondents
recollect their experiences through storytelling to family and friends, they will influence the
expectations of those who may be in the planning stage. Similarly, if respondents actually
revisit the destination with others, it is likely that they will become on-site mediators who
will directly impact everyone’s overall experience.

IX. Ways of Conceptualizing the Tourist Experience A Review of Literature – RYAN

People wish to relax, learn, see new places, or see places made familiar to them by television
and Internet.
If people were to view their holiday- taking behaviour as involving anti-social actions, then
the holiday and travel related industries as we know them would be forced to change.
 The general non-acceptance of smoking in a public place is today very different to
what it was in the 1960s. Social consumption patterns can and do change.

Importance-Evaluation Approaches – the reasoned behaviour, multi-attribute approach.

these theories may not necessarily lead to high coefficients of determination in quantitative
models that postulate a given behaviour as the determined variable – perhaps because of
the role of intervening or moderating variables that impinge upon the conative aspects of
such models

Involvement Theory – the degrees to which the visitor becomes involved and the extent to
which this involvement is enduring or situational. Holidays thus become extensions of life
interests and not escapes from life.
The Destination Image – how it attracts, holds and establishes the criteria against which a
visitor can evaluate their experience. While some of the concepts are derived from
marketing theory, the subject links with all of the above perspectives.

Theories of Liminality – the tourist is perceived as a person engaged in transitions from the
ordinary to the extra ordinary, and then back again to the ordinary – the stages marked by
different formalities, ceremonies, and roles

Role Play Approaches – that is, the roles that tourists can adopt, and the degree to which
these roles are motivated by a sense of role play

The Theory of the Gaze – the tourists’ desire for the visually impressive (framed by the
tourist’s camera) means that the tourist industry shapes and directs the participant’s gaze,
that the gaze is framed within parameters that make sense to the gazer while others act
roles as ‘gazees’ – or alternatively selective truths are presented that may not be truths as
understood by people local to the visited place

The Search for the Back Stage and Authenticity - visitors do search for authenticity and
want to penetrate the tourist veil – a view put forward to counter the earlier views who
wrote of a death of travel and the emergence of a pastiche of experiences made ready for
the hedonistic mind.

The Theories of Consumerism and the concept of the tourist as a collector of experiences –
Many tourist experiences are constructed by profit-motivated organizations

what of the issue of authenticity?

place may be constructed, there remains an existential authenticity – that is, while there
may be little historic or cultural integrity to a place – tourists can still genuinely enjoy social
interaction, have fun, reinforce social bonds including those of family, or indeed perhaps
have a moment of catharsis

studies of well being - the sense of well-being requires culturally authentic places.

Theories of Mindlessness - how habitual so many of our actions can be, and there are
many aspects of the holiday experience that are notable for their ordinariness.

concept of the critical incident - has attracted attention as has the search for the ‘golden
moment’ e.g. Disney formalizes the ‘golden moment’ by seemingly scheduling ‘unscheduled’
appearances by Mickey Mouse and his friends so that encounters with the characters are
the more ‘treasured’ for their very unexpectedness.

the career ladder based on Maslow’s hierarchy of needs

how we experience time on holiday - as we grow older, so our experience of time changes –
that as we age time seems to pass more quickly.

theories of intimacy - while the spatial and architectural aspects of a site or destination may
remain unchanged, the experience of being there can differ significantly dependent upon
with whom you share the place. Experiences of places change as one moves through life
stages, and the place of one’s youth can become a new place when being a parent with
one’s own children.

Theories of Flow and Arousal - that levels of arousal could initially evoke better levels of
performance, but that too high a level of arousal created feelings of anxiety that frustrated
abilities to perform well. Modification of this approach indicates different sets of reactions,
initially perhaps characterized by anger but then declining to frustration and then apathy if
the participant feels unable to manage a situation. Those who may have experienced flight
delays by package holiday companies, being deserted by newly bankrupted airlines or
frustrated by air traffic control delays or strikes may recognize this aspect of holiday
experiences, and that they are better avoided.

Risk - its perception by holiday maker. Additionally, for the industry itself, there is the means
by which operators, airlines and attraction owners manage risk and discharge the duty to
take care. While dangers have been persistently present when undertaking and while
holidays generally remain safe, for those adversely affected the outcomes can be potentially
fatal.
 Lower levels of holiday risk-taking may also be associated with digesting unfamiliar
foods, engaging in risky sexual behavior, or being the victim of fraud or theft.

The antecedents lie in a combination of motives, past experiences, personality and socio-
demographics along with marketing messages. Between these antecedents and actual
behavior at the destination lie the intervening variables of the actual travel experience, the
accommodation and features of the destination. Behavior is an adaptive outcome based on
gaps between expectation and the perceived reality of the destination and the nature of
social interaction with residents at the destination, tourism intermediaries and other
tourists.

X. CO-CREATION EXPERIENCES: THE NEXT PRACTICE IN VALUE CREATION –

Prahalad (Chris)

Consumers today have more choices of products and services than ever.
Firms invest in greater product variety but are less able to differentiate
themselves. Growth and value creation have become the dominant themes for
managers.

Consumers now seek to exercise their influence in every part of the business system. Armed
with new tools and dissatisfied with available choices, consumers want to interact with firms
and thereby “co-create” value
- interactions between companies and customers are not seen as a source of value
creation.

Consumers are now subjecting the industry’s value creation process to scrutiny, analysis, and
evaluation. Consumer-to-consumer communication -> alternative information &perspective.

Armed with knowledge drawn from today’s increasingly transparent business environment,
customers are much more willing than in the past to negotiate prices and other transaction
terms with companies

globalization, deregulation, outsourcing, and the convergence of industries and technologies

are making it much harder for managers to differentiate their offerings.
 if consumers do not see any differentiation they will buy smart and cheap.
 “Walmartization” of everything, from clothes to DVD players
From managers is require to escape their product-centered thinking and instead
focus on the experiences that customers will seek to co-create.

Managers have found ways to partition some of the work done by the firm and pass it on to
their consumers -> self-checkout (e.g., gas pumps, ATMs, supermarket checkout)
WHAT CO-CREATION IS NOT WHAT CO-CREATION IS
• Customer focus • Co-creation is about joint creation of value by
• Customer is king or customer is always right the company and the customer. It is not the
• Delivering good customer service or firm trying to please the customer
pampering the customer with lavish customer • Allowing the customer to co-construct the
service service experience to suit her context
• Mass customization of offerings that suit the • Joint problem definition and problem solving
industry’s supply chain • Creating an experience environment in which
• Transfer of activities from the firm to the consumers can have active dialogue and co-
customer as construct personalized experiences; product
in self-service may be the same (e.g., Lego Mindstorms) but
• Customer as product manager or co- customers can construct different experiences
designing products and services • Experience variety
• Product variety • Experience of one
• Segment of one • Experiencing the business as consumers do
• Meticulous Market research in real time
• Staging experiences • Continuous dialogue
• Demand-side innovation for new products • Co-constructing personalized experiences
and services • Innovating experience environments for new
 co-creation experiences

 Disney and Ritz Carlton have found interesting ways to stage an experience for
consumers

cell phones and the proliferation of PCs around the world are creating ubiquitous
connectivity.
Example: more than 70 million Americans have visited www.WebMD.com. More than 500
chat rooms exist on just cancer alone. A visit to the doctor today is qualitatively different
than it was 10 years ago. Patients want to engage in dialogue. They want to understand the
risk-benefits of alternate modalities of treatment. They have access to more information
than ever before,

BUILDING BLOCKS OF INTERACTIONS: DIALOGUE, ACCESS, RISK-

BENEFITS, AND TRANSPARENCY

Dialog implies interactivity and willingness to act on both sides. Difficult between two
unequal partners.

More importantly, dialog, access, and transparency can lead to a clear assessment by the
consumer of the risk-benefits of a course of action and decision.
Ebay and Amazon are further examples of this trend—both facilitate the process of
personalized experiences, both involve communities, both facilitate dialogue.

company and the consumer are opportunities for both value creation and extraction.
ultimate concept in customer segmentation is one-to-one marketing.

In co-creation, direct interactions with consumers and consumer communities are critical.
Firms must learn as much as possible about the customer through rich dialogue that evolves
with the sophistication of consumers. The information infrastructure must be centered on
the consumer and encourage active participation in all aspects of the co-creation experience,
including information search, configuration of products and services, fulfillment,
and consumption.
Co-creation converts the market into a forum where dialogue among the consumer, the
firm, consumer communities, and networks of firms can take place.

Co-creation of value fundamentally challenges the traditional distinction between supply

and demand. the firm may still produce a physical product. But the focus shifts to the
characteristics of the total experience environment. Now demand is contextual.
While the building of new capabilities is critical, it is less difficult than changing one’s
dominant logic.
Finally, firms must recognize that the more educated the consumer, the more likely it is that
she will make an intelligent choice and make tradeoffs that are appropriate to hercontext.

Consumers have to also learn that co-creation is a two-way street. The risks cannot be one
sided. The tobacco company has the obligation to educate consumers on the risks of
smoking and develop cessation programs. But if a consumer persists in smoking, he must
take responsibility for his own actions.