Study: Customization becoming more commonplace

Discussion
Photo: Nike
Jun 22, 2018
Tom Ryan

According to a YouGov survey, 26 percent of Americans have purchased a personalized product, also known as customization, either for themselves or someone else.

That compares to one in six who bought a personalized product or service in 2015, cited in a Deloitte study. According to YouGov, the five core personalization categories are apparel and footwear, food and beverages, technology products, vacation and travel experiences and household goods.

The YouGov study found:

  • A subset of consumers is dissatisfied with one-size fits all products: Consumers who have customized product tend to be younger, tech-savvy and more outgoing than those who haven’t.
  • Consumers will pay a premium for customization. Nearly half (46 percent) of those who have customized product would be willing to pay more for a personalized product. Of those who have customized apparel or footwear, 67 percent would pay more.
  • The reasons to customize vary by product: For sneakers, the reasons to customize include “to demonstrate creativity,” “standing out,” “feeling pride in creating something,” and “designing something just for fun.” For technology items, “To identify a product as belonging to me” and “to demonstrate creativity” were the two reasons. For food and beverages, the reasons were “to design something just for fun” and “to demonstrate creativity.”

According to A Gift Personalized, an online seller of personalized special occasion merchandise, commonly engraved gifts include pocket knives, lighters, money clips, cufflinks, wine openers, key chains, picture frames, jewelry, tote bags, bedding and apparel.

Customization’s growth appears to be driven by ease of finding monogramming services on the internet and advanced technologies that enable items to be adorned with graphics and digital images.

Many flagship stores have added customization in recent years to add an experiential element to the in-store experience. At Nike’s SoHo New York flagship, the first floor is dedicated to customized Air Force 1 shoes and apparel that may include modifications to the silhouette and the addition of pearl, stud and feather detailing.

The next step for the trend seems to be 3-D modeling and 3-D printing, which some see leading one day to mass customization.

DISCUSSION QUESTIONS: Do you see customization reaching another level in the years ahead or will it likely remain a niche offering for many retailers? Will customization be critical for a few categories and irrelevant for most?

Please practice The RetailWire Golden Rule when submitting your comments.
Braintrust
"Confident and creative consumerism is on the rise, which will help drive a continued interest in personalized products. "
"This is a premium offering and will carry a premium price as it adds complexity and cost to the operation..."
"I think customization and personalization are going to grow within the retail mix but it’s not yet clear exactly what form that will take."

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13 Comments on "Study: Customization becoming more commonplace"


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Nir Manor
BrainTrust

Customization will certainly grow in the coming years due to the maturity of enabling technologies such as 3-D printing, computer vision and AI coupled with increased consumer interest in customization from Millennials. Whether or not it will become mainstream for retailers is still unclear. It depends on the category and is subject to the capability of the retailers/brands to customize. Retailers and brands have the motivation to customize because it can justify additional margin and create a competitive advantage.

Categories in which customization will become a significant factor will be teen fashion, toys, baby games/clothes/accessories and sports accessories.

Lyle Bunn (Ph.D. Hon)
Guest

Customization is still not widely available and can be both time consuming and costly for consumers. Fashion, furnishings and electronics are the natural spaces for product customization to succeed. Each offers the opportunity for new service-type revenue and consumer connection for brands and retailers.

Bob Amster
BrainTrust

I agree with Nir Manor. Customization will grow somewhat because of enabling technologies. However, customization is relevant in certain product categories and not in others. It will increase the cost in some cases and it may take up more space in stores and dedicated production areas in fulfillment centers. The open question is striking the balance between the cost of and the demand for customization.

Anne Howe
BrainTrust

Confident and creative consumerism is on the rise, which will help drive a continued interest in personalized products. A willingness to pay more correlates to the ego satisfying, dopamine producing “I am unique” feeling that justifies the “I am worth it” driver. But at some point, mass production will neutralize the trend and it will morph into something else.

Gene Detroyer
BrainTrust

Absolutely! And don’t discount a future where customized products are delivered to your home via 3-D printing, which, of course will be as ubiquitous as home printing is today.

Ralph Jacobson
BrainTrust

With 7 billion people on this rock, many are yearning for ways to be noticed. Personalization via customized products is one very lucrative path. Technologies are there to make this happen, and many manufacturers have done this successfully for more than a decade.

Adrian Weidmann
BrainTrust

Being digital has also brought a broad spectrum of new innovations and production technologies to the manufacturing and supply chain industries making product and service personalization possible. Retailers and brands should embrace these capabilities to develop new business workflows. Personalization of products — from shoes to automobiles — is not only possible but can improve efficiencies in the entire supply chain due to the made-to-order process.

Ricardo Belmar
BrainTrust

Customization will certainly keep growing in the years to come, fueled no doubt by increasing low-cost availability of 3-D printing. This will have a greater impact on certain product categories more so than others. Consumers who purchase customized products feel better about their decision because the item is now uniquely designed for them personally. The emotional response results in very little buyer’s remorse and much greater customer satisfaction! The issues overall that keep the growth from exploding are cost and time. Higher cost to produce, and greater time to purchase when you’re waiting for customization. Again, this will vary based on product category but expect to see significant progress in this area in the near future as production costs for 3-D printing continue to decrease and the speed at which these products can be produced and modified improves.

Brandon Rael
BrainTrust

Customization and personalization play so well across all retail segments. It has become such a big differentiator for retailers, particularly in companies seeking innovative ways of engaging with existing and new customers. It has become such a value-added service to turn what was once a tedious shopping experience into something that is personal, memorable and experiential.

Monograms and personalization have become key retail trends, and provide a way for engaging with customers on a whole new level. According to The State of Fashion 2018 report, developed by Business of Fashion and McKinsey & Company, personalization is expected to be one of the major themes in the fashion industry in 2018.

Customers are always looking for ways to be unique and make a piece of clothing or accessory theirs. What better way of doing that than a monogrammed handbag or sneaker?

Cate Trotter
BrainTrust

I think customization and personalization are going to grow within the retail mix but it’s not yet clear exactly what form that will take. I’m not sure how much customers really want a tea towel with their initials on it or an engraved wine opener. I think customization will come into its own with the ability to change products to suit your needs or even design something of your own. Love the dress but hate the neckline? In the future you might be able to change it.

Andrew Blatherwick
BrainTrust
Customization used to be the domain of the rich; handmade bespoke tailoring for suits, designer dresses and then, of course, Rolls Royce, Aston Martin and other millionaires’ toys. However, technology has brought about more mass-market customization which is fun, creative and makes the customer feel good. This is something that can only grow and retailers online and in-store can offer customers something different, gain closer relationships with them and therefore build loyalty. From a supply chain point of view, this can create some headaches and increase costs but if this is built into the offering then it is a great challenge to have. It could make it very difficult to manage if mass customization results in very significant volumes of customized products in the chain. Technology in the supply chain will need to develop rapidly to cope with this. 3-D printing is one way of managing the production and will add a new dimension to getting the right product in the right place at the right time! This is a premium offering and will carry… Read more »
Ken Morris
BrainTrust
Ken Morris
Retail industry thought leader
1 year 3 months ago

Personalization and customization will continue to become more pervasive and may one day be ubiquitous. Two factors are driving this trend: increased desire for customers to feel special or unique and the fact that it is becoming easier and more cost-effective to create customized products. One day mass customization will be the norm. Today’s 3-D printing will morph into customer product made for you on a one-off basis — it is only a matter of time!

In addition to the examples above, Nike’s customized sneakers and A Gift Personalized, some retailers are designing brands that built on a 100 percent customized model. Indochino, a men’s clothing retailer, offers made-to-measure shirts and suits that are customized for every customer’s preference in material and style, and are sized perfectly for them. As the research shows, consumers are willing to pay more for customization and we will see more companies like Indochino that focus on other segments and products to give customers what they want — personalization.

Shep Hyken
BrainTrust

When a customer customizes a product, it gives them a sense of pride and even a higher level of “ownership,” which could be a product or an experience. Pride is an emotion, and anytime you can connect a positive emotion with a brand, the brand and the customer win.

wpDiscuz
Braintrust
"Confident and creative consumerism is on the rise, which will help drive a continued interest in personalized products. "
"This is a premium offering and will carry a premium price as it adds complexity and cost to the operation..."
"I think customization and personalization are going to grow within the retail mix but it’s not yet clear exactly what form that will take."

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