For a long time, many companies in various industries have recognized the potential of individualizable consumer goods for example by a 3D configurator. Retailers use Big Data to present their customers with a personalized range of products – it is the driving force behind Amazon`s success. Now brands are taking a big step forwards towards mass customization with personalization. They discover that they can increase customer loyalty and commitment – and use their customer base as a driving force for potential buyers.

Product customization helps companies increase sales in their own websites. For example, Pepperidge Farm customers are now designing Goldfish crackers and Jawbone customers are configuring their own jambox speakers. trek allows cyclists to build a bike from scratch. And Brooks Brooks Brothers allows men to design their own suits.

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A Bain survey of more than 1.000 online shoppers found that less than 10% of respondents had tried customization options, but 25% to 30% were interested. Experts estimate the market potential of product customization in the USA at approcimately $ 2 billion.

Beyond the sheer size of the opportunity, our survey showed that customers who individualized a product online were more interested in the company. They visited the website more often, stayed on the site longer and were more loyal to the brand. For example, the survey found that customers who designed their own shoes gave companies a 50 % higher Net Promoter ScoreSM (NPS®) – as standard method of measuring customer loyalty – than customers who bought regular products from the same manufacturer. Higher NPS typically means higher sales, referral rates, and customer value. Ken Seiff, Executive Vice President of Direct and Omni-Channel Marketing at Brooks Brothers, says: “In general, customers who buy customized products are more satisfied and valueable, By automating customization over the Web, companies can more easily reduce a customer segment to a factor of 1. In five years` time, consumers will expect this.

By providing customization capabilities, brands increase loyalty at a time when it`s more important than ever: In a recent Bain survey of more than 1.200 executives across different industries, 67% said their customers are less and less loyal to their brand. At the same time, companies can differentiate themselves from their competitors by customizing their products, while the internet quickly creates high price transparency and makes it easier for customers to compare products with standard feature. According to Google, 49% of mobile phone owners use their device to compare prices, and the number of mobile phone owners using price comparison apps is increasing. We`ve found that our customers are willing to pay 20% more than standard prices for customized products – and many companies are succesfully charging higher premiums.

Adaptation also helps companies reach specific consumers – such as the unpredictable buyers of the millennium generation, a group known for their fast-moving preferences. As a growing consumer force, young shoppers demand more individualized products than their older counterparts – they are nor one size fits all, but if every generation. With the spread of social media and online publishing, styles and trends are changing faster than ever before, forcing sellers to keep pace with changing preferences. Companies that offer bespoke solutions can use consumers as merchants – they continuously gain insights from custom designs and fine-tuning products in a feedback cycle that helps companies stay ahead of the competition. With each design choice, customers share shopper preferences in real time that go far beyond what they would say in a focus group. For example, what Brooks Brothers learns from its customers in one season is systematically used to deliver the next season`s product line.

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All these activities point to rapid growth in mass customization offerings across all categories. Early pioneers such as Oakley have shown that consumer demand for customized products in high, and successful programs provide positive ROI and customer engagement.” said Kent Deverell, CEO of Fluid, a digital agency and software service provider that helps companies introduce customization offerings.

Customers are becoming more and more accustomed to the possibilities of product customization, just as the framework conditions are evolving to serve the market. The technology has evolved to enable flexible, digitally controlled manufacturing processes and to integrate customer-initiated design processes into supply chains. Computing power and bandwidth are now sufficient to enable customer design processes without losing sight of the user experience. Companies like Fluid act as a one-stop shop for eCommerce retailers and brands who want to offer their customers tailor-made solutions. Ultimately, companies need to make adjustments, especially in the materials supply chain, to ensure the profitability of customization – but these challenges are increasingly being met.

What companies offer depends on what consumer want. We originally focused on the fitness issues that some competitive athletes face, but we found that people are not so interested in fit and size online,” said Harm Ohlmeyer, Chief eCommerce Officer at Adidas. Consumer preferences vary from category to category. Bains` survey showed that shoe customers want to wait three to four weeks for a product to be delivered, but that interest in tailor-made men`s shirts has declined after two weeks of waiting. All customers seem to want one thing: the ability to return the gods within a reasonable period, usually 30 days. Our survey showed that demand for custom products decreases rapidly when consumers think they might be dealing with something they don`t like – even if the response rates for early adopters of product customizations are lower than for standard products.

In addition to adapting the offer to the customer, success also requires that you decide in advance what a company wants to get out of the game. Some companies use it to improve customer acquisition and retention, while others turn it into an independent company. The knowledge of the objective helps to determine a second big consideration: How much customization do we offer you?

All successful companies follow five rules.

Know what you want. Before companies test the new possibilities, they must be aware of the strategic value they expect from product visualization. If the goal is to increase customer loyalty, the costs for product customization will be as high as in PR, advertising, market research or social media. According to the digital agency Fluid, Pepperridge Farm`s investment in customizable goldfish trackers will result in significantly higher costs. For other companies, on the other hand, the profit potential is the main reason for dealing with product customization. According to Fluid, this was the motivation for Longchamps to develop self-designed versions of its legendary Le Pliage carrier bags. At the extreme end of the  spectrum are companies where product customization is the core business. One example is Wild Things, which offers customizable Insulight jackets.

Know how much customization you really need to offer. Some brands allow consumers to design a unique product that is customized after the order is made and allows a number of customized functions. This is exactly what Indochino does with its tailor-made suits that are only available online. Other companies, on the other hand, offer smaller customization options such as adding a monogram to a standard shirt or engraving names on briefcases. And still others, like Serena & Lily offer the so-called “consumer-choice bundling”, where customers can, for example, combine their own bed linen from an appropriate selection. The process may feel personal, but it is not about product customization. Customers buy existing products, which are then picked up from a warehouse and shipped to them. For most retailersm it is the option that makes the most sense – they can sell from a standard product line. Serena & Lily`s average order value is 88% higher for customers who order bundles than for customers who buy items for items.

Make it simple. The visualizations used for product customization must be easy for the customer to use. If the customization processes are too complicated, many users will cancel the design process and ultimately the purchase process. Too large a selection also has a negative effect on the ordering process. In the case of shoes, for example, this could be achieved by limiting the individualization options to 7 to 10 design variants, which are important and easy to implement for the customer.

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Let people share. Many people would also like to share their individually designed products with friends and relatives. The social aspect helps companies to retain existing customers and win new ones at the same time. Longchamp offers a Facebook application with which users can share their handbag creations online. Other companies offer their customers the opportunity to create a virtual catalogue with all their creations. There are many more good ideas.

Enhance the customer experience and don`t disappoint. If companies opt for product customization, they must make the processes of product customization as pleasant as possible. As more and more retailers and brands offer their customers the Design-it-Yourself option, they should be able to increase profits, stay in touch with their best customers and reduce costs. Winners will be those who know their goals, understand how much personalization they really need, keep things simple and create a repeatable model to keep customers excited.