Profiting from Personalization: How Companies are Cashing in on the Demand for Customized Products
By Ginny Mumm – 05/18/2018
Like many consumers throughout the nation, especially Millennials, Becca Malkin likes to purchase products that reflect her own individual tastes and preferences. A 20-year-old college student at Chapman University in Orange, California, she has no intention of conforming to the norm. In fact, for Becca, the last thing in the world she would want is to be just like everyone else. One of the ways she differentiates herself from the crowd is by purchasing “customized” products ― uniquely designed items ranging from apparel, backpacks and buttons to cell phone, tablet and PC covers — that suit her distinct personal style. Things that she considers “uniquely Becca.” This desire for personalized products makes her part of a rapidly growing market segment that manufacturers and retailers are desperately trying to reach and entice.
Mass customization and new business opportunities
Businesses of all sizes are realizing that simply offering high quality, competitively priced products is no longer enough. Customers also want the option of personalizing the products they buy. This overall trend, known as “mass customization,” is becoming an increasingly important to the success of companies around the world. Just as mass production ― the ability to manufacture greater quantities of products faster and more efficiently — dramatically changed the way business is conducted, mass customization is ushering in another transformational paradigm shift.
It’s not just the big players like Nike, Kraft, Coca Cola and Ford that are discovering the importance of mass customization. Small and medium-sized businesses are moving in this direction as well, with consumer interest in product customization already significant. According to a recent Bain survey of more than 1,000 online shoppers, while just under 10 percent have tried customization options, more than a quarter of the shoppers polled ― 25 percent to 30 percent — expressed a desire to do so. And interest is growing. The customization boom is creating some incredibly lucrative opportunities that companies are capitalizing on ― not only for greater margins and profits, but also for increasing customer demand, engagement and loyalty. This is especially true with brick-and-mortar retailers striving to create an experience that gives shoppers a reason to shop off-line.
Perceived value equals real profit
Customization is helping companies differentiate themselves in an increasingly competitive marketplace. Consumers want to purchase products that create the sense of owning a “one-of-a-kind” item. They either expect to have the option to choose from various iterations of the same product, or even play an active role in designing the product they will be buying. “Whether purchasing a cell phone, a pair of shoes or a new car, consumers today desire products that are unique to them,” notes Melissa Donovan, editor ofIndustrial Print magazine. “They expect manufacturers and retailers to provide options and tools that make product personalization not only possible, but easy.”
In addition to allowing companies to meet the additional expectations of today’s consumer, giving consumers the opportunity to customize their products increases perceived value. Customers consider this “added value,” and are willing to pay more for personalized products, allowing the manufacturer or reseller to charge more.
Advanced technologies for mass customization
Fortunately for both businesses and consumers, advanced technologies are making product customization easier, faster and more cost-effective than ever. The study, “Markets of One: Creating Unique Value through Mass Customization,” compiled by B. Joseph Pine II, Bart Victor and Andrew C. Boynton, reinforces this point. “Continuous improvement has enabled thousands of companies to realize lower cost than traditional mass producers and still achieve the distinctive quality of craft producers. Through the use of mass customization, producers appeal to consumers by providing a product that matches or comes close to their ideal product, while allowing producers to utilize improved workflows and technology to maintain high output and obtain cost savings comparable to a mass production environment.”
Innovative technology such as flatbed UV inkjet printers provide creators with unique product customization capabilities, including the ability to print full-color photographic images directly onto three-dimensional objects in one-offs and short-runs, which previously required expensive set-up, large quantities or limited colors. Clear and white inks also open up creative possibilities for previously complicated texture effects and image layering that consumers often take for granted. These state-of-the-art printers use UV lights to dry or “cure” ink as it’s printed, allowing for an immediacy of printing that can be promoted for product personalization.
Cashing in on customization
Equipped with a UV-flatbed printer, a manufacturer or reseller can customize their products, or allow consumers to incorporate personalized designs, quickly and easily. These enhancements include colorful graphic designs as well as unique embossing and textural effects. Benchtop-sized printers fit into behind-the-counter settings, or small manufacturing facilities. Larger flatbed printers can print on larger items or in higher quantities ― virtually any material or object up to six inches thick and weighing up to 220 pounds.
Businesses ranging from start-up shops to Fortune 500 manufacturers are using UV printers to offer customers a wide range of product personalization options while cashing in on the mass customization boom. Take ALTR for example, an Orlando, Florida-based company offering a vast array of custom-clothing button covers. Since founding ALTR in 2012, owner Alexandra Gramatikas says business has taken off. She credits much of her company’s success to the technology developments that made producing a variety of unique designs simple, efficient and cost-effective. Or, consider the growth and success of Pretty in Polka Dots, a retail operation in Madisonville, Kentucky offering customized wooden interior décor pieces, toys, and more. Within six months of acquiring a UV flatbed printer, the company was able to increase revenue by 300 percent.
Product customization looks to be more than just a trend; it has become the new “normal.” As for Becca Malkin, our non-conformist Orange County millennial, next on her list is a custom designed cover for her MacBook laptop. One more thing that will make her stand out from all the other college students cramming for exams at the local Starbucks.
Ginny Mumm is a freelance writer based in Southern CA