Customization which enables customers to tailor a product’s appearance, features or content to their own specifications has been the “next big thing” for some time. For many companies, customizing products is one of the most critical tools to deliver true customer value and gain significant competitive advantage. Obviously the real challenge is not to customize products itself – but to do it in a profitable way.
The application of a product customization system, which offers a reduction of the lead time for products and quotations, is among the most effective ways of achieving this in practice. It also enables faster and more qualified responses to customer inquiries, fewer transfers of responsibility and fewer specification mistakes, a reduction of the resources spent for the specification of customized products, and the possibility of optimizing the products according to customer demands.
Several implementations of customization are operational today, such as software product configurations that make it possible to change functionalities of the basic product or to build fully customized solutions from scratch. This degree of customization has so far seen limited adoption. If an enterprise's marketing department offers wide variety of individual products it does not mean that a product is produced individually, but rather that similar variants of the same mass produced item are available.
Companies that have usually succeeded with mass-customization business models supply electronic products. Service companies are also noticing the power of mass customization. Call centers are offering pre-programmed, pre-recorded call flows to handle customers' inquiries. The agent in the call center handles the process, customizing it only as they need to because of something the customer says or needs, as opposed to varying everything, every time.
Today, consumers’ tastes and likes are being shaped by their experiences online. Customization has been playing a large and escalating role in those online experiences, from Facebook to Internet radio to mobile applications like location-aware Google Maps. These rising expectations are being met by three tendencies that promote customized product offerings:
- Supply chain technologies have been enabling more efficient production. The software used by the supply chain supports customers’ design efforts and also the suppliers’ fulfillment on the other side, as Bax packaging products demonstrates.
- Today’s customization technologies are cheaper and more available than before. The cost of developing customization technologies has dropped significantly in the recent few years.
- Tomorrow’s customization technologies will be even more revolutionary. Technologies enabling customers to design their own products will become more capable and more plentiful.
It is true that customized products are not yet widespread but interest in customizable products is growing. More than 35% of online consumers in the US are already interested in customizing products. Consumers enjoy that “I Designed It Myself” experience where they feel a sense of accomplishment from their design efforts. They also achieve additional value from the fact that product features will be exactly what they want. And they also can express themselves with those goods that reflect their unique design. Ultimately, they are willing to pay more for these products and they become loyal customers.
Written by: John Brandenburg