Joe Du Bey, CEO of Eden helps navigate The Experience Era and how the nature of experiences are transforming industries across the US. This talk showcases how different demographics of people value experiences and how that value is fundamentally shifting the business of entire industries. With real estate taking center stage, Du Bey brings forth examples from industries such as fitness, music, retail, coffee, enterprise offices & more.
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VIDEO TRANSCRIPT:
Hey my name is Joe Du Bey and I'm going to talk today about the experience era and how it's affecting commercial real estate. So what is the experience era? The main thing to take away is that the world is changing. It went from before being where it was something that you know you served any one industry and maybe sold a specific product and service. Today we're all actually in the experience business to think about commercial real estate today versus what's going to happen. It's a largely offline world. And that's it's something that is focused on the space and less on the people and the experience of them.
And that's something that's about to dramatically change. So what is causing the experience era in one word millennials today. Millennials are the biggest cohort of any population. This is a really substantial shift. And this is something that is affecting the preferences of the workforce itself. And the reason why that's so is because millennials are different. They actually value experiences over products. And this is a critical thing to understand once this is grasped. It all starts to make sense.
But the majority of one else would rather spend money on an experience than a thing. They're wired differently even when it comes to work. The majority of millennials would take less money. If they're able to have a better experience at the office if they felt the experience reflected themselves. In contrast in case you don't think that's different. Only 9 percent of baby boomers would do the same. They are wired a bit differently and we need to adjust to their preferences. So what makes something fit the experience area we've discovered there are six hallmarks to this new time.
Specifically you can see involves enabling technology. It's at least made more efficient through technology. Any one of the major experiences that consumers in enterprises are going through in the experience area users are empowered they have voice they're able to customize their experience. This is critical. It shows up in amenities. It shows up in services inexperience error people care about community and they're building community around these experiences that were previously about a service or product. It's really the community that wrap around it. Things have meaning. It's not just about the coffee for instance it's about why it's ethical inexperience era quality matters a lot especially because these millennials are investing in the experience so it makes sense that their since they're shifting money to that they'll care more about the quality of it.
And the last thing is design inexperience error. You'll notice that if it starts to feel to you like more and more things look like the inside of an Apple store it's because more more things do look like the inside of an Apple store. Millennials care a lot about design and it's showing up everywhere. So let's talk about a few industries and how they've been transformed already in the US. There's the music scene if you remember from 20 years ago when you show up to a concert there were a few people playing music and that's what a concert was. Now when you go to a music event it's really much more about the experience. You walk in and it's a crowd of people who are seeking like minded folks.
It's immersive. There are lights there's artisanal food. Yes someone's playing music somewhere but that's not actually the primary thing. You might take away from being at a music event these days and is popping up across the US. Now let's talk about retail. When you used to go to a mattress store it was a roomful of bunch of mattresses. Now you go in and it's actually limited minority might be a mattress. We're walking into is a place that's beautifully designed full of narrative really speaks to millennials. When you used to walk to a gym it was a place full of heavy weights. Now it's if you walk just like Soul Cycle what Barry's Bootcamp.
It's a group of people who are building community. They might feel even you might send something almost religious around the dedication to this specific group. This room and it's beautifully designed. If you think about consumer coffee it's again something where you know it's the kind of thing where people use to go and literally just get coffee from a diner. Now it's a beautifully designed room. Starbucks even calls itself your third place. Recognizing that there is a different kind of feeling that comes in to a coffee shop today and now you can start to see it in commercial real estate just that just starting to.
And that's something because in the past it was really a place where you got work done. If you look at this market leaders Historical Office now with Google there's a climbing wall. They care about customization choice services and they know this is critical for them to actually hire the very best talent. And what is an overheated talent war. The thing to keep in mind is that 99 percent of commercial real estate is offline. This is just starting to happen. And over the next couple of years you'll feel this in a really big way. This beginning it's experience matters because in the first couple of years whenever there's a tectonic shift those who adapt early those are the ones who get to have outsized influence and kind of pain in the future whereas we fast forward or in five years.
The folks who haven't become the laggards they're the ones who threaten the actual performance of whatever their underlying asset is. How will this change commercial real estate. What tactically do you need to do to enter the experience era. Well specifically think about your building across a bunch different dimensions. A big primary one is how do you think about lease terms. It's something where in the future people want to have duration of lease that reflects their actual needs which isn't decreasingly two to 10 years and much more let's say nimble outside of that space controls today it's something where people have almost no control almost no voice that is changing rapidly through technology email to enter from from accessing the building itself to requesting services.
You can now actually have control over almost anything. Tenant feedback historically ignored with a landlord or building and you're really thinking of it places us as a space as opposed to thinking of the people inside of it as customers in the future and experience first building. It actually solicits feedback. It cares how its customers are doing outside of that the brand of the building itself. This is something that's critical in the past people might not even know really what kind of building they're in who the owner is who's managing it. The future is a much more white labeled experience where the building itself has a brand that people care about outside of that something that's really critical is what do you provide in terms of services.
In the past nothing going forward amenity rich people should be able to get any kind of service they want from food to any sort of wellness and like yoga or whatever they might want they need to be able to access through their building. And the final one community. Right now buildings are a missed opportunity everyone in it could feel something. It could build loyalty. Instead today it's mostly a box that has no connectivity the experience era has arrived and there's no turning back at this point.
Over the next couple of years everything will change. Commercial real estate and it will no longer be about the space it's providing an experience with space attached. Eden is ushering that in for all of the commercial key stakeholders from the occupiers and the companies to the landlords and the property managers and we're enabling you to provide an experience first building for your tenants