Product Customization: What It Is and Benefits

Updated June 24, 2022

Consumers enjoy choice in their purchase of a product or service and customized goods invite them to engage with a sale even more. With the rise in online retail and mass customization in manufacturing, more businesses across nearly every industry offer elements of customization for their goods and services. Learning about product customization and how you can apply it in business can help you in your career, even in a variety of industries or fields. In this article, we explore what product customization is, give examples of it and discover five benefits for companies to offer customized products or services.

Related: The Consumer Decision-Making Process: Definition and Examples

What is customization of a product?

Customization of a product is the manufacturing ability to offer a variety of designs or details for one product, made specifically to a buyer's liking, much in part because of advances in technology and manufacturing production processes. Customization of products means a customer can select features like color, design, functionalities, add-on components or other options to make a more unique item rather than a mass produced one. For example, a shoe company can allow customers to design and order a one-of-a-kind sneakers through their online platform.

Product customization has grown throughout nearly every industry and is often a common element in persuading a buyer to make a purchase.

Related: 20 Common Types of Customer Requirements

What are the benefits of product customization?

Here are five benefits of product customization for marketing and sales:

  • Match customer demand: Increasing popularity for customized products shows how consumers like it. Offering options for customization helps potential customers find added value in choosing your company or business.

  • Increase sales and competitive edge: Customers can pick elements of their purchase, which can sway their decision to buy from one company versus another. You can command higher price points for customized products, too.

  • Engage customers: A customer may have a deeper feeling of ownership when they design and select certain elements of their purchase, like a made-to-order or mix-and-match offering. The more a customer feels engaged, the more brand loyalty you can build.

  • Build brand loyalty: Customer satisfaction ratings are a lead influence in establishing brand loyalty and having access and ability to design a product to their needs and wants can increase customer satisfaction. Lifelong brand loyalty customers also offer a high value benefit to a company, through future sales and word-of-mouth marketing to friends and family.

  • Gain market research: A purchase of a customized product gives you more insight into the likes, preferences and perceptions of your customer base than generic items. You can learn more about your customer and use that data and information for future marketing.

Related: A Guide to Effective Marketing Techniques

What are examples of product customization?

Many industries use product customization to encourage customer sales, the most notably being retail. Some brands primarily focus on customization and others provide it as an element to enhance their offerings and the customer experience.

Here are some example scenarios of product customization:

A furniture manufacturer

A national furniture manufacturer might feature a sectional couch or sofa that has multiple layout configurations to choose from, like having an extended chaise lounge cushion available on the left- or right-hand side. Customers can also pick from a choice of leg styles and sizes, fabrics, colors and cushion shapes to customize the couch to their living space.

A bakery

Small businesses or bakery departments within large grocery or warehouse stores both offer the ability to customize your order, like a birthday cake, for example. While some cakes are ready-made with a blank area for a personal message, like "Happy Birthday, Brenda," they bake other cakes made-to-order where a customer can choose the sponge flavor, a filling choice, frosting flavor and color, cake design elements and a personalized message. In this example, a customized cake likely takes longer to prepare and requires an order in advance.

An aircraft manufacturer

Airplane manufacturers now offer the ability for airlines and private companies to customize the layout, seat configuration, seat material or color, kitchen and galley layouts, bathroom placement and more. Standard specifications are starting points along with pre-approved selections or package bundles to build from for both branding and operational standpoints. For example, an airline might want leather seats, an advanced entertainment system, carpet to match their brand colors and specific bins for overhead luggage storage space. In the cockpit, they may choose certain navigation or communication operation systems.

A lawn care company

A small business owner runs a landscaping company and sells both standard services or customizable offerings. Some customers may choose a seasonal lawn mowing price for standard grass cutting, while others may choose to add hedge trimming, weed whacking, seasonal mulching and pet waste removal. A mix-and-match package deal that allows a client to customize what they need specifically to their lawn care needs can lead to future business, referrals and additional sign-ups for future services offered.

An automobile maker

An auto manufacturer offers standard features or highly customizable available options, depending on the buyer and their price range. The customization of vehicles has grown, once from basic selections like cloth versus leather seats to advanced technology and features and options like heated seats and steering wheels, cruise control, keyless entry, automatic start and hands free liftgates. Some higher end auto brands even feature optional add-ons like leather-trimmed air vents, motorized cup holders, granite trim, drowsiness detectors or a perfume dispenser.

A suit shop

A suit shop might offer a set selection of materials, colors and patterns with some ready-to-wear suits available for immediate purchase. For those who want a custom suite, they can select button, stitching and lining choices before having measurements taken to tailor the suit for them. A satisfied customer likely buys more suits and talks about the experience with family and friends.

An online retailer

An online retailer often saves your browsing and purchase history to make future recommendations on items to purchase that you might not otherwise see. It also promotes certain products for upcoming holidays or special events to encourage browsing. This curated content leads to unplanned purchases and increased revenue for the company.

Related: 10 of the Top E-commerce Companies

A streaming service

A video or music streaming service creates customized user profiles that develop personal taste settings based on songs you listen to or movies and television shows you watch on its platforms. The service then recommends new titles for you to enjoy that are like items within your user history and profile.

A toy store

Some toy company let children create their own teddy bear and other stuffed animals, making it fully customizable at every step, including with apparel and accessories. The customization helps children build a personal connection with the toy throughout the experience, and the company can command a higher retail price point compared to other stuffed animal brands.

A candy manufacturer

Certain candy manufacturers offer specialized orders for certain color combinations of their sweets and you can even personalize the candy with a logo, image or saying to celebrate special occasions like weddings, birthdays, baby showers or bar mitzvahs.

A photo printing service

Several online photo printing sites let customers create photo books, prints, personalized greeting cards, canvas, stationary, gifts and more using their own photographs and digital images. You can select everything from layout, typeface, colors, phrases and wording, designs and quantity. There is even an app feature that pre-selects images from your phone's camera roll to show you what a potential design or purchase can look like to encourage a sale.

A soft drink company

A soft drink company might create personalized labels to engage customers and increase sales or have a unique fountain soda vending machine that lets customers form their own drink mix, combining soda products in whatever proportion they choose.

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