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Experiences, not ads, will bring in the millennials for businesses

Stella Artois’s Sensorium is an interactive dinner that encourages diners to share their experiences on social media.

JENNIFER ROBERTS/The Globe and Mail

Usually, the best promise an airline can make to travellers is to get them where they are going with minimum fuss. But this week, WestJet Airlines Ltd. is all about the fuss.

The company is hard at work on its next stunt, surprising people on one of its flights with an "experience" that will be released as a video in October. Ever since WestJet's "Christmas Miracle" stunt in 2013 – surprising flyers with the gifts they had requested from Santa – proved a hit online, the airline's marketing strategy has shifted.

"In the past, we would have done large-scale brand campaigns, and now we've found this category in which people seem to enjoy sharing the stories we tell," said Corey Evans, WestJet's manager of sponsorship, community investment and experiential marketing. "We always say it's an experience first, and a content piece second."

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People were so touched by the first Christmas video that it had a direct impact on WestJet's bottom line: bookings actually increased at the time. The company has invested in creating experiences such as flying golfers to play on the course that hosts the Canadian Open, and bringing couples to Barbados for their marriage proposals.

The airline is not alone: More and more companies are carving money out of their advertising budgets not to make ads, but to create experiences.

They have a couple of important reasons for this. First, research has shown that young consumers with rapidly growing financial clout – by one estimate, they control $1.3-trillion in annual spending in the United States alone – value experiences more than things. For example, a Harris poll of millennials in the United States found that 78 per cent would prefer to spend money on an event or an experience than a tangible product. Psychological research has shown that consumers of all ages feel more fulfilled after spending money on experiences compared to material things.

That happiness drawn from experiences is only enhanced by the fact that many of us engage in a kind of performance of our lives on social media such as Facebook and Instagram. Part of the enjoyment of paying for experiences is posting pictures to show friends.

The shift in media has also changed people's relationship with advertising: The digital space is a more crowded ad environment than has ever existed before, and resentful people are ignoring ads, or using ad blockers. But by doing something that people may talk about, some advertisers can get around those challenges.

"It's a media problem," said Bertrand Cesvet, chairman of Montreal-based ad agency Sid Lee, which in 2013 created Sid Lee Entertainment to focus on creating events for marketers. "Because young people do not consume a lot of advertising directly, you're forced to pivot your business model. What is advertising going to be? It's going to be about word of mouth. "

Sid Lee has created branded parties for Absolut in New York, Johannesburg, Berlin and Sao Paolo, and is putting on more events this year, including one coming up next month in Los Angeles. The events have no actual sales pitch, but the brand is everywhere (one party featured a door cut into a hedge in the shape of the bottle) and guests cannot order beer.

According to research firm eMarketer, advertising spending on social media worldwide is set to jump 40 per cent this year, and a further 31 per cent next year. Persuading users to do some of that advertising for free can be beneficial.

The agency estimates the media value of these events represented a 30-1 return on investment due to guests sharing their experiences online, media coverage, and videos and other content about the parties.

The current preoccupation with experiences goes beyond just sponsoring concerts or sporting events: The brands want to be seen as creating the experiences.

This week, Stella Artois is holding the last in a month-long series of dinners in Toronto called Sensorium. Taking place inside a dome-shaped tent, the five-course meals have been designed to pair with the beer and were accompanied by image projections on the inside of the dome, music (including tables rigged to make soup dance in time with a drum solo), and other extras that were enough to make you forget you were dining in a parking lot beside a Starbucks. Tickets, at nearly $150 a pop, sold out in two weeks. Toronto was the global premiere: more events are to come.

The total cost to create and promote Sensorium was about comparable to what it would cost to produce a traditional TV ad and to pay for the broadcast time. That investment would make very little sense if the only ones exposed to it were about 2,300 attendees. But those diners' infatuation with baiting friends' envy on social media made the experience go much further.

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