Mass Customization Is (Finally) The Future Of Products

Mass customization has been the “next big thing” in product strategy for a very long time. Theorists have been talking about it as the future of products since at least 1970, when Alvin Toffler presaged the concept. Important books from 1992 and 2000 further promoted the idea that mass customization was the future of products.

Yet for years, mass customization has disappointed. Some failures were due to execution: Levi Strauss, which sold customized jeans from 1993-2003, never offered consumers choice over a key product feature – color. In other cases, changing market conditions undermined the business model: Dell, once the most prominent practitioner of mass customization, failed spectacularly, reporting that the model had become “too complex and costly.”

Overall, the “next big thing” has remained an elusive strategy in the real world, keeping product strategists away in droves.

This is all about to change. Forrester’s new report, “Mass Customization Is (Finally) The Future Of Products,” makes the call that it’s finally time for mass customized product strategies. As they have done across consumer markets, digital technologies are the disruptors. Current and emerging digital technologies are turbo-charging mass customization, breathing new life into the product strategy:

  • Today’s customer-facing technologies are cheaper and more social. Configurators, which help customers co-design their customized product purchases, are cheaper, better, and more ubiquitous than ever. They can finally be integrated directly into a Facebook site, which will facilitate social sharing and group co-design activities.
  • Tomorrow’s customer-facing technologies will be revolutionary. Technologies empowering customers to design their own products will become richer and more plentiful. For example, Microsoft’s Xbox Kinect shows the pathway towards the ultra-configurator: a device that can measure the contours of your body and allow you to use gestural inputs to design products.  (I draw pin-stripes on a suit I’m co-designing; I size the steering wheel of a car I’m customizing; etc.) The richer the configuration experience, the more appealing mass customized products will become – and these experiences will indeed be much richer.
  • Platforms are promoting discovery, fulfillment, and scale. Back-end systems like supply chain software provider Archetype Solutions offer better production-side IT analytics. And explicit platform providers for products, like Ponoko, Zazzle, or Spreadshirt, are popularizing, syndicating, and empowering an ecosystem of partners to devise their own customized products.

A variety of major brands – like Kraft, Hallmark, M&Ms, Wrigley, Nike, Keds, Ford, and many others – have recently introduced important mass customized product offerings. The time is now for product strategists in all industries to consider adding mass customization – including true build-to-order products – to their product portfolios.

To help product strategists succeed in developing mass customized offerings, Forrester developed a framework, called CURA. (“Cura” is Latin for “care,” and is the root of the word “curator”).  This framework – in simplified form – is depicted in this table:

In the future, mass customized product strategies will deliver individual products with rich, pervasive customization.  These strategies will embrace a number of characteristics, becoming more: Social, Physical (e.g. Kinect as configurator), Mobile, Intimate (i.e. deeply predictive), Embedded (i.e. moving deeper into product features), Platform-based (e.g. Zazzle), and Co-created. These offerings will drive unprecedented loyalty among customers and create powerful market differentiation for product strategists.

We invite clients to read the full report report, and look forward to your feedback. We've also published an article on Mashable, so please check that out as well.

Comments

Transcend mass customization into marketing.

Let's not forget that mass customization doesn't just have to relate to actual products, but the way in which products are marketed and sold.

In as early as 1993, in his book Mass Customization Joe Pine argues that companies need to develop multiple products that meet the multiple needs of multiple consumers, where "variety and customization supplant standardized products", and in 1999, Pine and Gilmore write that e-commerce enables companies to provide consumers with more choices, and that e-commerce applies mass customization principles not to the products but to the presentation in the online store.

Schafer et al (2003) write that one way to truely "customize" the presentation of products in e-commerce is through recommendation engines, and that's what we're doing at PredictiveIntent (www.predictiveintent.com). And this isn't even refined just to the e-commerce store any more. With email marketing, recommendation engines can present relevant personalized recommended products to individuals based on their behaviours - how much more "customized" can marketing be?

More on product variability

Good point, James. I wrote this post on Malcolm Gladwell's TED talk on product variability. Essentially, Mr. Gladwell describes Dr. Moskowitz's research on horizontal segmentation, ie targeting specific customer segments with a breadth of options. The classic marketing mantra still applies: STP - segment, target, position.

http://blog.treehouselogic.com/2011/04/07/malcolm-gladwell-on-variability/

Personalization engines serve this purpose, as you point out. Products are curated and recommended to individual shoppers, ie seamless discovery. Indeed, mass customization is a marketing strategy as well as a business model (and manufacturing technique).

Historical Issues With the Adoption of Mass Customization

I believe one of the historical issues with the adoption of mass customization is the need to change an individuals buying habits, patterns and behaviors. This is sometimes difficult since humans have an inherent reluctance to change. However, much of this reluctance is fading, in my opinion, as consumers are becoming acclimated to an environment where they can get “whatever I want whenever I want it”. Companies like Amazon, Netflix, Pandora, Rhapsody, and iTunes offer consumers virtually unlimited choices in real time. What I think mass customization allows is a company that operates in a physical goods environment (i.e. www.bluewardrobe.com) the ability to offer the customer anything.

Mass customization allows the deployment of a “long tail” strategy without the burden of physical inventory. Companies that can match their product offerings to the true shape of the demand curve (a curve that incorporates both “hits” as well as “niches”) will be able to offset any initial inconvenience that mass customization inherently possesses.

How did we provide mass customization while overcoming reluctance to change? We employed both an online and offline strategy to help customers “bridge the gap”. Customers can order a shirt online or have the unique experience of meeting one of our professional tailors in person. We ensure that an individual’s buying habits, patterns and behaviors are taken seriously. It has been said that an individual will only change their behavior if they are forced to (e.g. lose weight/stop smoking or face a premature death).

Very interesting concept,

Very interesting concept, although it really does make a lot of sense, if you think about it. Many costumers want things that weren't just made in huge mass-production, they want a personal touch. I was thinking and one business that would do very good with this concept would be people that make thank you eCards (ie http://www.rubberchickencards.com) and things like that.