Emotional Economy

1. Emotional Economy

2. Emotional Economy • The book ”Emotional Economy” by Peter Horn and Bo Bache, management advisor and IT-director respectively, is focusing on emotional values as the hardest currency in future markets.

3. Emotional Economy • ”Emotional Economy” is written on a basis of: • General observation of human behaviour. • Societal and technological developments. • Future challenges for man and mankind.

4. The market in the Emotional Economy • ”Still more people want to live several lives within the frame-work of the one, they have got.” • ”The nummer of different types of lifestyles will grow drastically. It will cause a change in the market and its composition”

5. The dream of several lives • ”Most of us have already dreamt of living several lives… wearing a distinct mask in each. • This is what’s good and bad - easy and hard, when you want to change track. From one existence to another…”

6. Capitalization: Life wage • Is the sum of your capitalizable value, measured by • Personal characteristics • Education • Business potential • Prognosticated behaviour

7. A life wage is not for all • World population will grow with 3 billion people to nine billion people in 2050. • Only the few will be prosperous from our standards. • Obvious global segmentation - including in developing countries. • More regional and global unrest. • The hegemony of the USA is diminishing. • A new political order is emerging.

8. Lifestyle beats products • Every customer wants to be the main character in her or his own reality show. • Providing the means of staging every customers individuality will be the largest business in the world. • 75% of consumption in the West is not of vital necessity. • The individual desire the emotional attention, that disappeared along with consecutive family life. • Companies that are able to be family and create realtions, will acquire the bulk of the customers.

9. Mass marketing will survive - with a new mission • Forget everything you learned about mass marketing - the customers want 1:1. • The target is constantly moving, and its no longer feasible to use bow and arrow - only the auto-guided missile, that automatically adjusts the course. • The customers couldn’t care less about your or your product or service, unless… • Maybe the lesson is, that a successful corporate strategy in the future is a reflection of the market - not an attempt to influence it for own gain.

10. Women will take charge • The female part of the Danish population is 50,5%. • In the business community 3% of executive and board directors are women and 97% are men. • According to an American survey of Fortune 500 companies, businesses with female executives have a 20-70% higher yield on net capital compared to other businesses in the same industry (see http://www.fremtidensledelse.dk). • The Norwegian government has decided that by 2005 all companies on the stock exchange are required to have at least a 40% representation of both sexes. • Danish companies could make an estimated 20 billion DKK higher profit, and tax revenue would increase with 13,5 billion DKK p.a. with more equality in boards and managements. • Women will take charge: Men will pursue new barrier-breaking goals - and women will acquire more competence in general management. • Market relevance: Marketing will be on the conditions of each individual customer - no matter the sex of the client. Marketing is not a gender-related issue - it’s about competence.

11. The new challenge to companies • How do you make family with 4 million customers? • How do you build up enough trust to be able to get direct access to customers pockets ? • How do you gather the mental fingerprints of your customers - and with it their history and future? • How du you surmount practical obstacles?

12. Customer capital value • Is defined as the customer capital value of a given company, measued from: • Customers emotional bond through lifetime value multiplied with lifestyle time.

13. A new estimation of value • Can emotions be converted into an economic measurement? Once the debate was, whether the Earth was flat or round… • In a few years corporate value will be measured from the ability to acquire, retain and extend emotional relations with customers. • Customers will invest in relations-based companies that are best at dealing with ethical, moral and financial demands and expectations on a 1:1 basis. • Remember - that customers will buy solutions or solution models in the future - not finished products. And - emotions may be at stake, but the brain is still working.

14. Be the target: The customer is the hunter • New marketing is about making the customer use her instinct for hunting - instead of feeling like a moving target. • The blind shall walk and the lame shall see. • The shift in roles is significant, and more marketing will focus on Marcus Antonius: ” I’ve come to bury Ceasar, not to avenge him…” • For that reason: Who’ll have a say over the future developments in the market? The market itself or marketers? And who’s what when?

15. Winners and losers in an emotional economy • Strong brands with extended 1:1 customer relations will gain, because.... • Traditional brands are necessary in order to gain access to the marketplace. • New forms of marketing based on surprising and abstract thinking rather than graphic design will set the agenda. • It’s always the past that catches up with you, never the future!

16. Get the full picture (in Danish):http://www.foelelsesoekonomien.dk