Scientific research has shown that people who spend their money on experiences, rather than things, tend to be the happiest.
8 Minute Read
As a society, it’s advice we seem to be taking, as more people are investing in the experience economy.
In this Trends snapshot, we’re going to highlight a handful of businesses that are satisfying consumers’ thirst for interesting outings and experiences––and making millions in the process. We’ll also show you how you can capitalize on this growing market.
To begin, let me introduce you to the YouTube channel the Best Ever Food Review Show.
I wouldn’t call myself much of a cook, but I love this channel, which is approaching 3m subscribers because they know how to make viewers think they’re worthy of a Michelin star.
One recent episode that caught my attention was the plight of a restaurant owner in Louisiana who showed how he cooks Crawfish in the thousands.
Viewers would later learn that the chef in question had not attracted an especially large customer base. But how he plans to pivot his business is what I found the most interesting.
He wants to take visitors through a full cajun cooking experience, giving people a behind-the-scenes look at the history of southern Louisiana and its charming way of life.
Over the last few months I’ve been obsessed with finding similar stories: Business owners who see an opportunity to give the generation that seems to have everything a new way to look at (or interact with) their local surroundings.
Let’s dive in…
MuseumHack: The One That Started It All
If you’re not familiar with Nick Gray’s MuseumHack, you’re in for a treat.
Not only has Nick publicly shared the revenue numbers his unique museum tours are generating, but he’s shared them consistently for years.
From that you can see how the business has evolved and how he’s reacting to the opportunities (and challenges) he’s seen along the way.
Nick first had the spotlight shined on his venture back in 2013, with a post on Lifehacker that’s currently sitting at over 37,000 pageviews.
Back then he described his company as being in “total bootstrap mode.”
He didn’t have any revenue numbers to share but could reveal the entire operation was being run on his 13” Apple Macbook Air, sitting atop a standing desk.
It’s a humble, almost movie-like beginning to a successful startup story.
With first year revenues coming in at a modest $60,000, just two years later his annual revenue would reach $1.3M.
Revealing his specifics in a podcast interview, that year he sold over 10k museum tours at an average cost of $75 per ticket.
Now a featured ZenDesk success story, he revealed the company was on track to hit $4M in revenue for 2017.
Nick recently revealed he’s hit a plateau at around the $3m revenue range for the last two years, though I’m sure he would have been delighted with those numbers if you predicted his future during his earlier days.
It’s All in a Name: Under30Experiences Is Taking Off
It’s always nice when a business you’re interested in has already publicly submitted their revenue numbers for verification to the Inc. 5000, a list of the fastest growing private companies in the US.
That’s the case with Under30Experiences, revealing their income for 2017 hit $2.5M, with three-year growth of 627%.
As the name alludes to, Under30Experiences is focused on offering group travel deals for young adults, featuring destinations such as New Zealand, Vietnam and Costa Rica on their homepage.
So what’s the allure of booking through U30E compared to, say, Expedia or Booking.com?
Through the personal connections the founder made, they get “access to places you couldn’t see as a tourist,” according to this YouTube video.
With travel being one of the biggest industries on the planet, it’s a compelling argument to set your sights on places you might not be able to experience in any other way.
Diving into public SimilarWeb data we can see that organic search is undoubtedly the top driver of traffic to the business, accounting for an estimated 82.72% of all visitors.
Thanks to top rankings for terms like “millennial travel” and “packing for Thailand,” it’s likely the case that people come across their unique take almost by accident.
The Newcomer That Helped Over 1m People Recharge in 2018
Running my own SEO agency, I’m privileged to constantly work alongside interesting companies looking to get more attention on their unique offering.
One company I advised last year was BookRetreats, founded by friends Ron Piron and Sean Kelly.
When I asked why they started the company, Sean replied, “We saw that too many people in the world are living unsustainable lives. People are deeply stressed, are overwhelmed by daily life, and simply need some time to recharge.”
It’s a compelling mission in a social-media obsessed age, with Sean adding that he’s “found yoga and meditation retreats can work wonders for people’s mental and physical health.”
Though I’m not here to add any more competition to a duo of founders I admire, I am wildly obsessed with how our current reliance on technology is affecting us mentally.
I see a huge opportunity for businesses with a similar, detox-like focus to thrive in 2020 and beyond.
Paint. Drink. Have Fun. (And For Entrepreneurs: Make Money)
That’s the slogan (minus the brackets) for Pinot’s Palette, founded a decade ago as a franchise business, introducing people to the idea of painting and drinking wine at the same time.
Co-Founder and CEO Crag Ceccanti led the business to revenues of $7.2m for the year 2017, with three-year growth of 102%.
This five-year Google Trends chart suggests there’s still a lot of growing left in the “paint and sip” business, likely due to the low costs involved to get set up.
That said, they’re not taking on the market alone, with Wine and Design, Bottle & Bottega and Painting With a Twist all offering similar, franchise opportunities.
The latter made it on to Entrepreneur Magazine’s Franchise 500 list, coming in at number #163.
If you have any experience at all with paid ads on platforms like Facebook and Instagram, it’s something you could try on a small scale before deciding whether it’s the next venture for you.
Speaking of Alcohol: Wine’s Not the Only Thing on the Menu.
You drink. We drive.
You won’t come across a much more compelling slogan than that.
City Brew Tours, describing themselves as North America’s “Best and Oldest Brewery Tours”, pulled in $2M for 2017 with three-year growth of 187%.
Focused on daily tours in nine locations, including New York, Boston and Cleveland, founder Chad Brodsky has made his arrival in each new city an event, picking up local press as he goes.
Focused on launching in cities with an already thriving beer scene, one tour guide for the company spoke to the Baltimore Sun about how receptive breweries have been to the idea.
“We actually pay the breweries for samples, and we bring them people” he said. “All we really require is that we’re able to provide that VIP experience.”
This is one business model I could also see thriving outside of the US, especially in big cities like London and Berlin, where the tours could entice locals and tourists.
Wellness Becomes Experiential: Zeel Is One to Watch
Raising $13.2m in 9 separate funding rounds, Zeel is taking a new angle with the wellness craze, offering same-day massages at home.
Fortunately we don’t just know how much money they’ve raised, but we’ve also got some insights on how much they’re making: revenue came in at $22.6m for 2017. That’s a lot of back rubs, even if margins are likely small due to the money they pay their “vetted therapists.”
Search traffic is undoubtedly going to be a focus of theirs going forward with the site ranking for popular terms such as:
- Lymphatic massage (12,000 monthly US searches)
- Plantar fasciitis massage (3,700 monthly US searches)
- Mobile massage (2,300 monthly US searches)
- Home massage (1,200 monthly US searches)
Zeel isn’t founder Samer Hamadeh’s first startup rodeo — he’s also the founder of Vault.com, a platform for career advice and company reviews.
Experiences, Delivered: Joymode is Combining Two Hot Trends
Subscription boxes started out as a novel idea but now they’ve taken over almost every niche out there.
From Harry’s with their monthly razor blades and Ipsy with their monthly “beauty in a box,” Joymode has become a platform for introducing you to new things.
If you sign up for their introductory plan at $29/month (for three months) you can expect to receive items like a Theragun massager, a Nintendo switch and even a Vitamix blender in their quest to introduce you to something new.
You don’t get to keep the items, of course––a Nintendo Switch alone could run up a year’s membership––but you do get to try things that may have otherwise ended up collecting dust after their first month’s use anyway.
Joymode’s founder, Joe Fernandez, is the founder of Klout, a business he sold for $200m. I’d keep your eye on this company, which has already raised $16.7m in total funding.
Want in on the Action? Here’s A Goldmine of Public Market Data
Experiential gifts are gaining in popularity as well, including unforgettable experiences you can do with family members.
Take my friend, Damon. He and his son recently forged knives out of horseshoes together.
Not that Damon is sucked into the Instagram generation, but it’s also the kind of activity that looks great on social media for those who are inclined to share.
One of the best examples and sources of inspiration from this undoubtedly comes from Airbnb.
With public ratings counts––and the date associated with each review––you can instantly see:
- What experiences are popular in any area
- Which experiences do best at certain times of the year (looking at review dates)
- Pricing that works, even when giving Airbnb a cut
It’s an incredible source of market intelligence.
Don’t be mistaken, these are not just $50 wine tastings walking around the street.
Airbnb experiences can go for thousands of dollars, such as this six-day slow food safari in the Galapagos which starts at $3,600 at the time of this writing.
In the Arts and Culture category alone you can get inspired for similar businesses you might be able to get into. Some of the most popular that stood out to me include:
- San Juan Walking Tour – 938 reviews ($26 per person)
- Copenhagen Culture Walk – 285 reviews ($74 per person)
- Berlin Beer History Walk – 544 reviews ($22 per person)
- Edinburg Harry Potter Walking Tour – 1,480 reviews ($19.55)
You can also get the numbers directly from the source, as Airbnb shared the 10 most booked experiences on their entire site back in August of 2018.
My favorite is a toss up between hiking with rescue dogs in LA and going on a bike ride through Mexico to find the best tacos.
Keep in mind that these numbers above only represent those who took the time to leave a review, and only people who purchased the offering via Airbnb.
Sure, there are some activities on the site you likely couldn’t get involved in yourself, unless you have a few tame wolves or foxes hanging around.
But…neither can Airbnb. There’s a lot of money to be made in being the middleman.
- And if you want to go all-out, remember that just one single idea can explode into a huge thing.
- Museum Hacks was a one-man operation in New York before it really started to take off.
- City Brew Tours perfected its business model in Burlington, Vermont, and then later rolled that model out to more cities.
- Zeel only focuses on offering massages and nothing else.
- BookRetreats is in the travel space but is primarily focused on your mental health.
If you have skills with online marketing, there’s a planet full of people waiting to be delighted offline.