The Hendrix Chord and the Blues
Musically, "Purple Haze" centers on the famous Hendrix chord. That chord, which starts the verse sections of the song, was commonly used by Jimi Hendrix in several songs, particularly on Are You Experienced. Technically speaking, the chord is a modified dominant seventh chord, an E7 #9 (omit 5), but in all likelihood that means next to nothing to you. It didn't mean a thing to Jimi Hendrix either—he knew nothing of music theory. In Jimi Hendrix, Electric Gypsy, Harry Shapiro and Caesar Glebbeek describe the raw, angular sound of the Hendrix Chord as an extension of Jimi's "roots in black music. Much of the pulse of black music is encapsulated in the [dominant] seventh chord and that's how an R&B guitarist would have originally played it. When black sounds became more funky, ninths were added, and what Jimi did was to sharpen those ninths for a different sound again."
The numbers—sevenths, ninths, and fifths—correspond to notes in the scale of the root note. That sharp ninth that the authors mention does not fit the musical scale of the song, and we call it a "blue note." Blue notes are notes played off pitch intentionally for a dissonant effect. That dissonant sound is what characterizes the blues scale; going back through the history of African American work songs, singers and performers would throw these "worried," blues-scale notes in for an emotional effect that often conveyed an ugliness, pain, heartbreak, or loss—in a word, the blues. In tossing this additional blue note into the fray, the chord encapsulates the blues sound and the blues scale almost completely.
The idea that the sharp ninth comes from the blues scale is clear in "Purple Haze" because the blues scale is thrown on top of the E Major throughout the entire song. What that means is despite being in the key of E Major, the song uses blue notes D and G—the sharp ninth—almost exclusively in the song. The chord progression of the verses, for example, is E7#9, G Major—not the standard major scale G# minor—and then A Major. This is a good thing, though, because the interesting thing about the blues scale is that it works best when it collides with another scale. That is to say, Hendrix's use of the blues scale here is particularly successful in part because it competes and meshes with the major scale. This is most obvious in the guitar solos, where Hendrix alternates freely between playing notes in the E Major scale, like G#s (like at 1:19) and C#s (1:33) and playing the blues scale D and G notes (1:10 and 1:15). This dirty, yet oddly beautiful mix of scales in Jimi's music heavily suggests the Hendrix Chord, which aptly summarizes the essence of Hendrix's guitar playing.
Production and Effects
Jimi said that "Purple Haze" was inspired by a dream that he had, in which he was taking a walk under the sea. The production of the song impressively captures this psychedelic, dreamlike vibe that so many assume is drug-inspired.
While the rhythm and guitar (for the most part) are mixed equally in the left and right channels, the vocals are mixed unevenly between channels in the stereo recording. The main vocal is focused in the left channel, and with it also being louder in the mix; it seems to float above the rest of the music in a surreal way. Adding to this is a second layer of vocals in the right channel that uses heavy reverb (an echo effect that you might experience in a large auditorium or gym). Because of the reverb, the vocal sounds distant and hazy and perhaps even imaginary.
"Purple Haze" is also noteworthy for its use of guitar effects. Though other musicians, such as Eric Clapton of Cream, had been experimenting with the use of distortion and other effects for a time, the use of a proto-Octavia pedal in "Purple Haze" in particular was important in influencing guitarists to make larger use of effect pedals. The Octavia pedal, invented by Roger Mayer and first used by Jimi Hendrix in "Purple Haze," is featured in the song's solo and outro. It reproduces the guitar's input sound exactly one octave higher, combining it with the original input to great psychedelic effect.