Insights

How Product Customization is Revolutionizing Ecommerce

From fashion to food & beverage to technology, customized products are becoming more and more commonplace in brick & mortar and digital selling environments. Forrester declared that mass customization is (finally) the future of products back in 2011, and Bain outlined rules for success in product customization in their 2013 brief. Bain’s survey of more than 1,000 online shoppers that year found that while less than 10% had leveraged customization, 25% to 30% expressed interested in doing so.

While mass product customization can often add to production costs, it is a differentiating tool that can lead to higher profits due to increased customer satisfaction and loyalty. Further, rather than using historic data and industry trends to guide production numbers, businesses can reduce waste by limiting production to the items that customers are seeking.

In many ways, customized products are a new form of old-school luxury and personalization. Just as consumers went to tailors for bespoke fashions in the past, today’s shoppers are looking for custom products that meet their exact specifications and needs. Product customization provides consumers with a sense of exclusivity and importance, while leveraging the technology solutions of today to scale and simplify production to reach the widest market possible.

When implemented correctly, product customization addresses several important psychology concepts, including ‘overchoice,’ ‘analysis paralysis,’ and ‘cognitive dissonance.’ These concepts are linked to the decision-making challenges that occur when a person is presented with too many options. If you’ve ever spent 10 minutes staring at a wall of peanut butters at the grocery store, or have been overwhelmed by the number of toothpaste variations at a drugstore, you’ve experienced ‘analysis paralysis.’

Put simply:

More choices → More outcomes → More risk and opportunities for regret and dissatisfaction

Customization eliminates the stresses and pitfalls associated with too many choices by leaving the consumer with one solution that is tailored specifically and purposefully to their needs and desires.

Today, countless businesses in a number of industries have ventured into the world of custom products. For the purposes of this article, we’ll focus on three specific industries.

  • Apparel
  • Beauty
  • Food & Beverage

For years, retailers and consumers alike have been customizing apparel. Designers have created custom pieces and outfits, and tailors have altered items to meet individual specifications for decades. However, traditionally customized apparel can be cost-prohibitive, and the amount of time it takes to create or alter a custom piece can be a deterrent for shoppers seeking instant (or near-instant) validation from a purchase.

Nike shoe

Ecommerce solutions are beginning to address these issues. For instance, Zazzle is an online marketplace of designers who provide made-to-order customizable products. Shoppers can browse and purchase head-to-toe apparel in styles custom to their tastes using pieces from their network of artists and designers. On a much larger scale, international footwear and apparel brand, Nike, offers custom sneakers, designed performance, fit and style, through their NIKEiD online portal. Shoppers can specify things like color, materials, feature and fit based on a catalog of options.

Matchco 1

Matchco 2

Customization has reached nearly every category of beauty product, including makeup, fragrance and haircare. Matchco is a new digital solution that leverages patented mobile technology to create a foundation shade that perfectly matches a customer’s skin tone. Luxury cosmetic brand Lancôme has created a similar solution, called Le Teint Particulier, that leverages a facial scanner to identify skin tone and guide the foundation formula blending. For haircare, Function of Beauty is a new company specializing in personalized shampoo and conditioner, customized to hair type, goals, and tastes. Each individual bottle of hair product is uniquely labeled and filled, down to the color of the formula itself.

Function of Beauty

Function of Beauty

The food & beverage is a fast-growing segment of the ecommerce industry, and while only select brands have forayed into customization so far, we expect that number to grow as consumers begin to demand that meals and snacks are just as personal as their clothing and personal care. Just as brick & mortar restaurants like Chipotle and sweetgreen have embraced customization as part of their service strategy, ecommerce businesses have begun to adopt the trend online. One such brand that has committed to customization is YouBar, a nutrition bar company that allows customers to create their own product through an interactive online survey with questions ranging from goals and lifestyle to protein type and sweetener used.

YouBar

Product customization is a differentiating tool for businesses that can empower shoppers, boost satisfaction and loyalty, and lead to increased profits. Sellers of everything, from shampoo to sneakers to snacks, are realizing the value in allowing customers to create their own products to drive loyalty and differentiate, and platforms and configurators are enabling scalable mass customization through their advanced technologies.