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Should Your Business Customize Its Products?

Kiely Kuligowski
Kiely Kuligowski

As customer data becomes widely available, many companies are customizing products.

Some companies will put your name on things. Others will tailor their suggestions to your specific desires. Should you?

  • Customization is a fresh trend that is popular with customers and can add an edge to your business.
  • Small businesses, however, should carefully review if customization can fit into their business plan.
  • A well-thought-out plan is key if your business wants to add customized products.

Branding and marketing are changing rapidly to suit an ever-evolving market. Among the latest trends is a growing interest in customization, a response to customers increasingly wanting new ways to feel special and "seen" by big companies.

Coca-Cola made a big splash when it came to personalization in 2014 with the launch of its Share a Coke campaign, which features bottles with popular names and colloquial sayings to inspire customers to seek out bottles with their own name or the names of loved ones. There has been a veritable onslaught of personalized products since then – shampoo, vitamins, meal kits, clothing and more.

Part of the impetus for this new trend, dubbed the "market of one" by Michigan State University, is increased competition. Much of the modern marketplace has become optimized to the point where companies are constantly seeking out new ways to stand out from the crowd, and offering custom products is an easy, profitable way to do that.

"If you don't customize your product, at the end of the day, there isn't much that separates you from your competitors," said Cameron Zoub, co-founder and head of growth at Varfaj Partners.  

Allowing your customers a hand in creating exactly the product they are looking for adds significant value to the product and the customer's time. It also has an enormous psychological effect in that it creates a personal connection between the customer and the product, and, by extension, between the customer and your business.

Personalization also brings you closer to your customers by making your business seem more human and authentic.

"Personalization adds a human element to any brand by making it all about the consumer, as opposed to the product," said Jason Brown, CEO of Persona Nutrition.

Because personalization has a big impact by making your product stand out and hold more meaning for your customer, it can be tempting to jump in and start offering customization right away. But before you do make the leap, there are a few things you should consider.

What's the difference between personalization and customization?

While personalization and customization might seem identical at first glance, there are a few fine distinctions between the two.

In the book Future Perfect by Stan Davis, "customization" is defined as "the process of delivering wide-market goods and services that are modified to satisfy a specific customer need," while "personalization" is defined as a marketing strategy that "aims to create personalized or one-to-one communication with a single consumer or consumer segment."

Think of personalization as receiving a marketing email that uses your name in the salutation, or Amazon suggesting items for you based on your previous purchases. Customization is more like receiving a box of products chosen specifically for you, based on your expressed interests or needs.

What value can personalized or customized products add?

One of the first things you should do when considering personalizing your business is to determine your 'why.' Whatever the reason, it should be something that adds value to your business. It could be that it increases customer satisfaction or attracts new customers, or offers your business an opportunity to grow. It should not be forced, because then you run the risk of disrupting your mission and confusing your customers by offering a service that doesn't make sense for your business.

Customized or personalized products or services should attract new customers, add something that entices existing customers to stay, or collect useful data about your customers that can help you better deliver what they are looking for.

"[Businesses should customize] as long as the customization represents high value that the customer is willing to pay for," said Susan Trivers, founder of Trivers Consulting Group. "The company has an extraordinary opportunity to increase profitable revenue at a low risk."

Do customized products make sense for your business?

The next thing you should do is determine whether or not personalization/customization makes sense for your business.

"If it takes substantial resources and distracts from the core business, or if it's not feasible financially, then it may not be beneficial," said Antonella Pisani, founder and CEO of FACT Goods.

Not all businesses or products lend themselves to personalization or customization as an option. Think about what your business offers and whether that product or service can be tailored to individual customers, as well as whether your business has the capacity – both financial and human – to support it.

While personalization and customization have become popular, a recent study by Bynder found that a majority of businesses reported wanting to personalize their marketing. Yet 50% of respondents were only somewhat confident or not confident at all about their ability to create personalized or customized experiences, and 90% were unsure about what technology they could use to support the goal.

Many companies, such as Persona Nutrition and Stitch Fix, use detailed quizzes coupled with data collection and AI to create custom shipments that fit each customer's needs. Others use more traditional personalization methods, like printing names or sayings based on direct customer requests on physical products.

If you do choose to try personalization or customization, make sure you know your customers well. The key to successful personalization or customization is having as much data as you can about your audience to make sure your products are fulfilling your customers' expectations. Provide plenty of opportunities for customers to contribute information – like surveys, questionnaires and feedback forms – and make sure that you have a system to analyze and use that data.

Do you have a strategy in place?

The customization/personalization trend is heavily rooted in human psychology. People love to feel special, talk about and identify aspects of themselves, and receive products made specifically for them.

"Once a customer [has personalized a product], they're more likely to see it as a representation of themselves and thus are often more content with the product," said Michael Anderson, marketing specialist at GeoJango Maps.

It is vital to have a plan for how you will execute your personalization or customization, however, or you run the risk of annoying your customers – for example, if they spend too much time inputting information into a quiz or survey without getting the product or service they're looking for.

Because most modern customers have limited attention spans and do not want to spend too much time on a quiz or inputting information, make sure your setup – whether it's a form, quiz or block of information – takes less than five minutes to complete and that you have access to technology that can accurately and effectively analyze the data.

A combination of human touch and AI is an effective way to make sure you are fulfilling your customers' expectations. The AI can quickly analyze the data, and you can ensure that the details are correct.

Customization or personalization can bring significant value to your business and add a new level of connection for your customers, but it should not be forced. Take the time to carefully consider if and how you should implement customization or personalization.

Image Credit: Antonio Guillem / Shutterstock
Kiely Kuligowski
Kiely Kuligowski Staff
Kiely Kuligowski is a and Business News Daily writer and has written more than 200 B2B-related articles on topics designed to help small businesses market and grow their companies. Kiely spent hundreds of hours researching, analyzing and writing about the best marketing services for small businesses, including email marketing and text message marketing software. Additionally, Kiely writes on topics that help small business owners and entrepreneurs boost their social media engagement on platforms like Facebook, Twitter and Instagram.