The ‘Experience Economy’ - based on selling experiences rather than products - is booming. As the pandemic brought an uptake on virtual experiences, everything from augmented and virtual reality and the Metaverse to cryptocurrencies are being demanded more by consumers.
The World Economic Forum has even forecasted that the only companies that will exist after the next decade are those that create and nurture human experiences. Offline experiences have become key to people’s happiness.
Even from a business aspect, customer experience has become a key brand differentiator overtaking product and price. The question as to why this happened has many answers, one of which is the phenomenon known as the ‘commoditization of things’.
It is easier to get products from around the world, and many brands offer free shipping, which lowers the perceived value of these products. This is a problem of abundance; when something is not scarce or rare, people are no longer interested in it.
Vacations, concerts, dinner at a restaurant, etc. are placed at a higher level of value, a change driven by millennials. Fifty-five per cent of millennials say they are splurging on events and live experiences more than ever before after years of restrictions. Today’s need to document and post shareable moments has modified what people look for in life experiences. Taken all together, there is tremendous potential.
The MENA region’s entertainment and leisure is witnessing significant expansion post the success of Expo 2020, with new destinations being planned and existing ones updated. The UAE is a prime place for expansion of the industry, as it has years of brilliance to build on.
What FIFA 2022 means for UAE
Keeping what we know about the experience economy in mind, the Middle East is anticipating one of the world’s biggest sporting events. Most of the aspects of any global sporting event revolve around lifestyle and entertainment. Take for example the Super Bowl in the US, where a concert was hosted during half-time at the inaugural event — this ushered in the era of entertaining audiences using the anchor of a sports spectacle.
A global sporting event defines the lifestyle and community engagement of an entire city or country. From themed events at local hangouts to topical sales and offers at malls for the period of the event (and even before it begins), everyone gets involved.
The global sports tourism market size is valued at $323 billion in 2020, projected to cross $1 trillion by 2030 according to a report by Allied Market Research. This includes the sectors of hospitality, airlines, retail, events, entertainment, and the arts. With a projection of 1.2 million to1.5 million visitors set to visit Qatar for the World Cup, opportunities for FIFA to galvanize the local and regional entertainment businesses are many. If one takes only Dubai as an example, Deloitte factors that sponsorships across the major sporting events hosted in and by Dubai result in an estimated $100 million per year.
Dubai, which hasn’t hosted a FIFA World Cup or Olympics yet, saw the restaurant and café business rise by 500 per cent during the 2014 Racing World Cup. For markets like Dubai, there is also a huge potential to host and entertain sports fans with immersive activities that will help them feel engaged during the FIFA event.
We are working on a few such developments with the DIFC district – M2L Market in Dubai. There will be a temporary entertainment area connected to the various fan zones on the roof of Gate Avenue Mall, where audiences will be able to cheer for their teams on giant live screens and participate in a wide range of cultural and education immersive activities.
These could be themed concerts and community sporting activations for all ages, to F&B experiences and business talks to just name a few. The UAE has years of experience enhancing its entertainment industry, FIFA 2022 promises to bring more of these kinds of concepts, only propelling the Experience Economy upwards.