I like the topic of customization because it is fun with colorful components. And it combines well my technical background with my love of creative matter. Yet to understand the challenge of customization it must pass through the theory. Laying the foundations of that « mass customization » beginning with its definition:
The objective of mass customization is to deliver goods and services that meet individual customer’s needs with near mass production efficiency
Engineers Tseng and Jiao were the first in 2001 to lay the foundations of this industrial strategy which involves proposing to consumers an usual product with the characteristics and preferences of each buyer. This method involving an effective production tool connected to a process of making command to specify the desired characteristics and measures. Mass customization in the definition phase of the needs or desires is therefore closely linked to the Internet. At an intersection between breathlessness model of mass production and advances of on-line configuration software which made say Nike founder a good morning at the beginning of the century « do something useful with the internet!” … before creating the most famous mass customization model: Nike ID… Nike ID.
Since the model has spread in all sectors: from personalization of casual goods with zazzle.com or CafePress.com, to the food industry with customization of the sweets round MyMM’s until the automotive industry where the Toyota’s Scion is customizable to requirements.
What are the main advantages for those companies which have joined the mass customization in their sales strategy ? :
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Differentiation through « individuality ».
By allowing its customers to personalize its products, a company is different from its competitors and slows logic of running after lower prices and cheapest labor costs characteristic of mass production.
Indeed, the customization implies a perfect control of its information flow, production flexibility and geographical proximity to its customer to meet deadlines despite this requirement for one to one. The logic of economy of scale is substituted for the value of customer satisfaction: The client is more accurate and the rate of claims is reduced since it is himself involved in the finishing of his good. -
Reduce the cost of stock and overproduction.
The production is controlled by the need not the forecasts that manage stock. Forget the sales or special reduction that low margins … And as most of these companies are selling on the Internet, they save the margins of costly intermediaries … -
Better knowledge of your customers.
Custom’ products are primarily adopted by lead users, especially the « influencers » who will communicate on their purchases to many (marketing theory of von Hippel). Getting their inputs is a warranty to better serve main stream.
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Higher customer loyalty
The brand knows its customers individually. It is therefore easier for them to interact directly with them and establish a strong relationship: Offer promotions, give appointments to events, bring fun with applications they will share with their networks & friends. Actually create a community. -
Shopping becomes an « Experience »
Take control of the product design is an exciting stage. Becoming a designer … chose color or shapes…. As many positive experiences that strengthens identification with the brand…
Of course, given this list of advantages, it is clear that the Internet « Pure Players” are favorites. Not only because they have the knowledge of web ergonomics and data mining, but because the service mentality of the teams is already focused on clients. Plus the organization of these structures is made to ensure that the information flows between all divisions of the business. Go and explain to a « traditional » marketing department that the client knows better than him what he wants for him… To the communication department that “influencers” are spreading more rapidly and massively than him its good news … That the production of tomorrow will be different from those of today…
But there are many companies that have already passed this change of industrial vision. We will see a lot of BtoC examples through this blog,but there are also successes in the field of BtoB. For example, the provider automated conveyor Montech already sells its conveyors on-demand …
mass customisation model for BtoB
Hera luminaries, founded in 1934, does offer architects to configure their installation on-line. The manufacturer of electrical cabinet Lampertz gives the choice of configuration to electricians? …
For those companies for which the mass customization is synonymous with success, it was noted 3 main challenges:
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Establish dialogue and interaction with customers.
Combining the efficiency of small modular units of production with the ability to command in unit calling absolute necessity of putting the customer at the heart of the creation of value. The interface between them is located at level of the configuration tool products. A configuration at the same time suitable to the logic of the users and opened to their remarks and sources of improvements (I will detail the characteristics of configuration software in a future posts). -
Define the limits of personalization
Answering the question « what is possible and what is not?” and establish the perimeter of the customization that respects the core know-how of the company. -
Modularity
Do not forget that the various customizable modules must work together … at the end … This means configure and model the different possible combinations. Both functional and aesthetic…
These are all challenges that may be difficult or heavy to implement for a company alone. But is probably organizations role to study the basis and benchmarks for this industrial revision. As the Centre Scientifique et Technique de l’industrie Textile belge (CENTEXBEL) ) who sees personalization and mass customization (CPM) as a source of innovation (and salvation) for its member companies, and has launched a large study project over 3 years which may well lead to a profound reorientation of Belgium textiles sector. The findings of the major academic centers could well help the most motivated companies.
Led by the MIT Smart Customization Group for the United States, and European national institutes like in Poland,Germany, Ostreich, or Hong Kong where research groups are formed with regular dissemination of valuable recommendations for the deployment of customization and mass personalisation.
Interest in their work or subscribe to my blog. I will keep you posted …
