Why mass customization

The consumer and optician next collaborate to adjust the shape and size of the lenses until both are pleased with the look. In similar fashion, consumers select from a number of options for the nose bridge, hinges, and arms in order to complete the design.

Then they receive a photo-quality picture of themselves with the proposed eyeglasses. Finally, a technician grinds the lenses and assembles the eyeglasses in the store in as little as an hour. The adaptive approach is appropriate for businesses whose customers want the product to perform in different ways on different occasions, and available technology makes it possible for them to customize the product easily on their own.

Rather than repeatedly having to adjust separate light switches until the right combination is found, the customer can quickly achieve the desired effect merely by punching in the programmed settings.

The cosmetic approach is appropriate when customers use a product the same way and differ only in how they want it presented. Rather than being customized or customizable, the standard offering is packaged specially for each customer. Although personalizing a product in this way is, frankly, cosmetic, it is still of real value to many customers.

Witness the billions of dollars that consumers spend each year on such products as embellished T-shirts and sweatshirts. The Planters Company, a unit of Nabisco, chose cosmetic customization when it retooled its old plant in Suffolk, Virginia, in order to satisfy the increasingly diverse merchandising demands of its retail customers. In the past, Planters could produce only long batches of small, medium, and large cans; as a result, customers had to choose from a few standard packages to find the one that most closely met their requirements.

Consider ChemStation of Dayton, Ohio, which mass-customizes a product that most of its competitors treat as a commodity: industrial soap for such commercial uses as car washes and cleaning factory floors.

This practice eliminates the need for customers to spend time creating or reviewing orders. They do not know which soap formulation they have, how much is in inventory, or when the soap was delivered. They only know—and care—that the soap works and is always there when they need it. Although each of the four companies has implemented a strikingly different customization strategy, all share an orientation that challenges the conventional concept of markets and products.

As mass production took hold in the hearts and minds of managers during the past century, the definition of a market shifted from a gathering of people for the sale and purchase of goods at a fixed time and place to an unknown aggregation of potential customers.

Today as markets disaggregate, the definition is changing again: customers can no longer be thought of as members of a homogeneous market grouping. In fact, the concept of markets needs to be redefined still further as customization becomes more commonplace.

Economies of scale in manufacturing and distribution brought down the price of mass-produced goods so much that all but the most well-to-do customers were often willing to forgo their individuality and settle for standardized—but very affordable—goods.

Still, the uniqueness of individual customers never went away; it was just subsumed in the averages of countless bell curves in every market-research study ever performed. The concept began coming back into view when companies discovered segmentation in the s and niche marketing in the s.

And so it seems that we have come to the end of a year progression. Or have we? In fact, the journey does not end with every customer being his or her own market. The next step, a widespread recognition that multiple markets reside within individual customers, will turn the entire notion of markets and customers completely inside out. The idea that every customer is in different markets at different times and different places is not as heretical as it initially might sound.

For instance, newspaper publishers have long recognized that most of their customers have more leisure time on Sundays to read the paper and accordingly have filled that edition with a greater number and wider variety of stories. Similarly, airlines, hotels, and car-rental companies find that the desires of their clients differ greatly depending on whether they are traveling for business or for leisure—and differ yet again when they combine the two.

Only those companies that take their approach to customization down to this level will gain access to the multiple markets within each of us. How can companies tackle this task? If the technological wherewithal exists, the easiest approach would be to design a product that could adapt to whatever market its user happened to be in—such as a car transmission that can be sporty for tooling down the coast or smooth for taking the in-laws out to dinner.

For frequently purchased goods and services, a company could work with individual customers first to identify the markets they potentially could be in at different times and in different circumstances and then to maintain a distinct profile for each possibility.

A real opportunity arises here because even the customers themselves may not realize these distinctions. Many people in many situations will discover things about themselves only in a collaborative dialogue with a trusted supplier. Together, customer and supplier will create the multiple markets within. Instead of focusing on homogeneous markets and average offerings, mass customizers have identified the dimensions along which their customers differ in their needs.

These points of common uniqueness reveal where every customer is not the same. Adept mass customizers have identified the dimensions along which their customers differ in their needs.

To be effective, mass customizers must let the nature of these sacrifice gaps drive their individual approaches to customization. Paris Miki understood that consumers rarely have the expertise to determine which eyeglass design best fits their facial structure, desired look, and coloring, and therefore chose to collaborate with customers to help identify their largely unarticulated needs.

Lutron adopted adaptive customization because it knew that no two rooms have the same lighting characteristics and that both individuals and groups use any given room in multiple ways. Planters realized that each of its retail customers varied in how it wanted to receive and merchandise standard peanuts, so cosmetic customization was its favored choice.

And ChemStation understood that although each of its customers had unique formulation and delivery needs, none of them wanted to be bothered with either the day-to-day procedures or the formulation of such a mundane part of its business as soap.

Altering the product itself for individual customers provides the most clear-cut means of customization. But adept mass customizers realize that customizing the actual product is only one way to create customer-unique value. Customizing the representation of the product—or how it is presented or portrayed to the customer—can be effective as well.

In fact, separating the product from its representation can provide a useful framework for considering which forms of customization are most appropriate for a given business. A cosmetic customizer changes only the representation of the product—the packaging in the case of Planters.

Collaborative customizers change the product itself in addition to changing some aspect of the representation. A transparent customizer uses a standard representation to mask the customization of the product.

Each Lutron customer programs a lighting effect by adjusting bars that represent the intensity of each light in the room; the customer then can label the particular lighting effect. The following components also can change the form of an offering for individual customers:. The four companies that we focus on identified the critical customer sacrifice gaps in their businesses and then carefully identified not only what but also when to customize in an effort to create the greatest customer-unique value at the lowest possible cost.

Instead of taking a hit-or-miss approach, these four companies customized only where it counted. Instead of taking a hit-or-miss approach, successful companies customize their goods and services only where it counts. Customers in these industries have to make onetime decisions based on difficult and multidimensional trade-offs—trade-offs such as length for width, comfort for fit, or complexity for functionality.

Customizing the representation permits customers to participate in the design stage and play with the possibilities available to them. At Paris Miki, customizing the representation of the eyeglasses permits customers to participate in the design stage. Paris Miki decided that the best way to help customers discover their unknown needs and resolve the inherent trade-offs associated with buying glasses was to allow each one to explore and manipulate a digitized representation of the potential final product.

With this sophisticated design tool, trained opticians now assist customers in discovering the perfect, unique look that they would not otherwise have identified or found. With the mass data, or first handed feedback gathered the customization process, brands are now able to implement any necessary amendments at the initial level according to real time market demands and therefore saves money and time.

To get the most out of it, marketers need to know the different versions of mass customization and the methodologies behind so to apply to their businesses:. Gilmore and B. Examples include the 3D watch configurator by the luxury brand Baume , allowing consumers to use a 3D configurator to personalize every detail of their desired watch, as shown above.

Those are only a few examples of collaborative customization that have delivered proven results. Source: Guerlain 3d perfume configurator in cooperation with Hapticmedia. Customization is not only about the product itself, but the identity and the message it passes to different audience segments. Cosmetic customization means that an item is presented and packaged differently to adjust to consumer desires or to create a tailored and high-end experience that allows shoppers to leave their mark on the final results.

An excellent example of this category is the customizable parfum by Guerlain in cooperation with Hapticmedia. The brand has implemented a 3D product configurator which makes it possible for website users to design their own perfume bottles , to choose from a range of sizes, colors and accessories, as well as to add personalized texts to the labels. Although it has only been launched for a few months, this new feature is already gaining huge popularity from media and customers, who enjoy having their favorite Guerlain fragrance packaged in a unique bottle that expresses their own personality and sense of style.

Adaptive customization offers consumers a series of standard products that can be utilized differently by end-users according to their own demands and occasions. A brand that implements such a tactic needs a basis, a standard package of services or products that might be specifically targeted at certain groups, and resources to monitor and extract data from their consumers.

A top-of-mind example of transparent customization is what Netflix does with its recommendation lists, where the company suggests movies and shows that might be interesting to certain users. Ritz Carlton Hotel Group, too, manages to surprise its guests with their favorite drinks and food, each time they check-in. Mass customization is having a great impact on the productivity of industries. This learning relationship explains how the producer and the customer manage to have a continuous connection with each other , which is strengthened through interaction and various forms of collaborations designed to meet the specific needs of consumers.

The goal of mass customization is to provide the possibility to create, anticipate and cater to specific consumer demands in a transparent, engaging and mutually beneficial relationship for both the company and the client.

Therefore, for industries or companies that aim to offer highly satisfying or even surprising products and services to clients, based on innovation and creativity, such as luxury, mass customization serves as a critical strategy in the long run.

Garner, S. Finding the Luxury in Mass Customization. Business of Fashion. Muehlbauer, P. Mass Customization the Global Mega-Trend. Linked In. Consumer Barometer. Jackson, L. Gaffney, S. Alcimed digs into four key benefits of mass customization to show you how it can improve the competitiveness of your company. Mass customization requires three main actions from companies: — Distinguishing the product attributes along which customer needs can vary the aspects of the product that are customizable — Reusing or reorganizing existing production adapting the production to customization — And helping customers recognize or create solutions to their own demands leave some space for customer feedback to learn about their needs.

These actions allow companies to differentiate themselves from their competitors, in their internal organization as well as in their external image to the customers. Mass customization benefits companies by ensuring cost advantages obtained due to their scale of operation, with cost per unit of output decreasing with increasing scale.

Companies can produce in mass while keeping costs low. Indeed, costs related to customization operations must be considered but can be optimized. This will not significantly impact the time of delivery of the product to the customer. Customized labels on Coca-Cola bottles. Photo credit: photo from Coca-Cola company website.