There is an assumption that has guided much of the investment in technology over the last decade: that digital, when becoming good enough, would replace physical in almost everything. Streaming would kill cinemas. Social networks would kill events. Course platforms would kill conferences. What happened was the opposite. The better digital became, the more expensive and valued physical presence became. Not because people are irrational or nostalgic — but because the economic logic of attention works exactly that way.
The economy of scarcity in the world of digital abundance
In economics, the value of something is closely linked to its scarcity. When digital content becomes abundant to the point of ubiquity — when any movie, song, course or conversation is just a click away — what becomes scarce is the opposite: the experience that cannot be compressed into pixels, that requires physical presence and that, by definition, cannot be infinitely scaled.
The Taylor Swift concert in 2023 and 2024 is the most cited example because the numbers are hard to ignore: billions of dollars in revenue, secondary ticket markets with stratospheric prices, economic impact on entire cities. But the phenomenon is not exclusive to megastars. Restaurants with months-long waiting lists, meditation retreats that cost more than an international trip, conferences where admission costs ten times more than access to online content — all are capturing the same logic. Physical presence has become a marker of seriousness, belonging and status precisely because it is difficult to replicate and scale.
For brands, what this means is a strategy reversal that not everyone has realized yet. For years, the effort was to digitize—put everything online, scale without friction, reach the most people with the least marginal cost. The next frontier is deliberate selectivity: creating in-person experiences that only work in person, and that justify prices that digital would never bear.
What defines a premium in-person experience
Not every in-person experience is premium. What differentiates those that create lasting loyalty from those that are just events is a specific combination of elements that digital cannot deliver: serendipity, corporeality and perceived scarcity.
Serendipity is the unexpected encounter with someone who will change something — a business partner, a new perspective, a friendship that defines a phase in life. Well-designed physical events are serendipity machines. The networking that happens in the hallway of a conference, in the coffee line at a retreat or at dinner after a show is not replicable because it depends on uncontrolled variables that digital, by design, does not accommodate.
Corporeality is the most underestimated component. Being physically present somewhere — feeling the volume of an arena, the temperature of an environment, live sound without compression, food that cannot be delivered — activates parts of the human experience that the screen cannot reach. This explains why tasting dinners at restaurants with years-long waiting lists continue to sell out even with the rise of virtual dining experiences. Flavor does not travel through the cable.
Perceived scarcity is the mechanism that converts the previous two into economic value. A ticket to an event with 200 seats costs more — and is worth more psychologically — than access to a livestream with 20,000 viewers, even if the content is identical. Brands that understood this stopped maximizing capacity and started optimizing exclusivity.
What this means for hospitality, events and physical retail
The sectors most affected by this dynamic are experiencing clear polarization: the middle is dying, but the extremes are thriving. In hospitality, 20-room boutique hotels and artisanal experiences are growing while midsize chains face margin pressure. At events, big festivals and small exclusive retreats are full, while generic corporate conferences face declining attendance. In retail, concept stores and flagship stores as brand showcases are experiencing a renaissance while commodity retail definitively migrates to digital.
The logic is the same in all cases: when consumers have digital access to almost everything, what they decide to visit physically needs to justify the effort, time and cost with something that simply does not exist in an online version. This puts enormous pressure on experience design — not just how the space looks, but how it makes people feel and what they report afterward.
For brands that build community, the in-person experience has become the point of consolidation of relationships that begin online. The logic of reading clubs, product groups, academies that build tribes — they all converge on the same insight: digital creates knowledge, face-to-face creates bonds. And bonding is what sustains recurring revenue.
How a leader should look at this
The most common strategic mistake is to treat the in-person experience as an alternative to digital — a kind of plan B for those who don't know how to scale. In-person is the top of the relationship funnel, the place where long-term loyalty is forged. Treating it as an operational cost is measuring the wrong thing.
Brands that have built in-person events as an extension of the digital community — like Notion with its meetups, Figma with its Config, Stripe with Stripe Sessions — aren't just generating leads. They are creating passionate advocates who will convince others within their organizations with an intensity that no marketing campaign can match. The ROI of a well-executed event does not appear in the cost per lead — it appears in the lifetime value of the customers who participated.
For those operating in hospitality, retail or events, the question that defines the strategy is: what will the person who came here feel that could only have happened here? If the answer is vague, the experience is not yet at the premium level. If it's specific, memorable and impossible to replicate digitally, you have a product that the market will price much higher than you imagine — and will seek you back.
The scarcity you create does not diminish your audience. It defines who your audience is.
Also read
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- Brand events as a strategy: from logistics to legacy
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