Let's illustrate the "value add" experience ladder in terms of birthday cake. Four stages: Raw materials, goods, service and skyscraping experience.

1940. The raw materials economy. Grandma spends about a buck to buy, flour, sugar, butter. Using these "raw materials," Grandma produces a birthday cake. Price $1.
1950. The goods economy. Mom goes down to the local Safeway, spends a couple of bucks, makes a cake from a packaged industrial product. Betty Crocker cake mix Price $2.
1970. The service economy. Bakeries are available to ordinary folks, not just the rich. So Mom heads to the bakery at birthday time for a professionally baked cake. Price $10.
TODAY. The experience economy. Dad is in charge of the kid's birthday now, and the kid lays down the law. "I'm having a birthday party, Dad. It's going to be at Chuck E. Cheese, and I'm bringing my pals." Dad obliges and forks over a C-Note...for the "experience." Price $100.