Demand shift into “soft” products and experiences in well-developed countries

The other day I read an accurate and intriguing quote that went something like, “… we exchanged buying new things for buying new experiences, and are much, much happier.”

In well-developed countries, I believe we are reaching a asymptotic bound on how much further we can improve the efficiency in our lives. We have washing machines, dishwashers, microwaves, toaster ovens, robotic vacuum machines and various other time-saving devices. True, these will only become better and faster, but the leaps and bounds over the last 100 years will be hard to beat.

I thus predict (well, it’s already happened over the last 20 years) a change in demand from “hard” products to “soft” products. Hard products being defined as something tangible that you can hold, and soft being the (mathematical) complement to hard products–things you cannot hold onto, or touch.

Soft products would include watching movies at a movie theater, going skiing, traveling, eating at restaurants, exercising, concerts etc… The list goes on and on. Included in this list could be demand for products such as MySpace or Facebook, which help document these soft product experiences–fittingly, a social network cannot be touched as well.

The shift from hard to soft products is most easily characterized by the shift to a service economy. All of the above soft products are service based–they require a service to function.

Perhaps this has already been defined previous to me (probably 20 years ago!)–but I believe the internet has amplified soft product exposure and availability. Soft products can be easily shared through Web 2.0 services–flickr, YouTube, blogs, and the aforementioned social networking devices.

The coming years, supposing a steady or consistent growth of income will only expedite this adaptation. During the coming decade, I predict the leaps and bounds of health, education, and social equity changes will drive further growth into the soft product industry. There is already strong rebellion against product advocacy–Palahniuk’s Fight Club being the most fitting example off the top of my head–a glorification of experience, and damnation of hard products.

Granted, this is not as much a shift from hard products to soft products, but more of an addition of demand. Because our incomes have far outgrown our demand for hard products (well, at least the marginal happiness we gain from “one more washing machine” is much less), we crave something new–our brains have decided that experiences and soft products are a good thing to add into the mix.