Mass Customisation

Why is this now an issue?

End of a mass production era (supply)

The post war period was a time of economic growth when customers would clamour for whatever goods were available. To-day, mass production has in many cases produced an over supply of very similar goods and, in particular, services. And in a global information based society, ideas can easily be replicated by competitors; price wars are common and deadly. Customers are smarter and are wary of blandish marketing phrases such as "new", and "enhanced formula".

Individualism (demand)

Peoples lives today are more turbulent and diversified. The "one size fits all" model is out-of-date. Individuals now want to be seen and treated as individuals and many are prepared to pay for this. They are better educated and informed; able and willing to make their own decisions.

Competition (demand)

All companies are promoting value for money, quality, durability, etc.. It is difficult to differentiate products. To make matters worse, in many industries there is a variety of new entrants, for example, Tesco, Safeway, Sainsbury (all food retailers) and Marks and Spencer and Virgin into financial services. Their strong brands can displace established leaders, especially when their products seem identical.

Profitability (demand)

In many businesses, 20% of the customers provide 80% of the profits but in many cases these profitable customers are discriminating. They want to have products and services that meet their particular needs.

Technological progress (supply)

The new interactive technologies provide a new delivery vehicle whereby customer can participate in the product design to create their own unique custom products or services. Gateway and Dell in personal computers, Acumin Corp. in vitamin pills, and Chubb & Sons and USAA in insurance. All these interactions can be captured into customer databases. Database mining then allows individual profiles to be compiled and then analysed for new market opportunities to specific customers, both current and new.

Follow the link for a more fuller discussion of these environmental factors.

Managing Change is building a Strategic Interactive Marketing framework and a complementary database of example companies that are achieving mass customisation.

Next is Much more than Mass Production or Mass Personalisation

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