Executive Summary
Increasingly, firms adopt mass customization, which allows consumers to customize products by self-selecting their most preferred composition of a product for a predefined set of modules. For example, personal computer vendors, such as Dell, allow customers to customize their personal comuter by choosing the type of processor, memory size, monitor, and so forth. However, how such firms configure the mass customization process determines the utility that a consumer may obtain or the complexity a consumer may perceive in the mass customization task.
Mass customization configurations may differ in four important ways: First, a firm may offer few or many product modules that can be mass customized and few or many levels among which to choose per mass customizable module. Second, a firm may offer the consumer a choice between very similar module levels or between very different module levels. Third, a firm may individually price the modules within a mass customization configuration along with pricing the total product, or the firm may show only the total product price. Fourth, the firm may show a default version, which consumers may then customize, or the firm may not show a default version and let consumers begin from scratch in composing the product.
The authors find that the choices that firms make in configuring the mass customization process affect the product utility that consumers can achieve in mass customization as well as consumers’ perception of the complexity of mass customization. Ultimately, both product utility and complexity determine the utility that consumers derive from using a certain mass customization configuration.
The study offers good news for those who wish to provide many mass customization options to consumers, because the authors find that within the rather large range of modules and module levels that are manipulated in this study, consumers did not perceive significant increases in complexity, and they were indeed able to achieve higher product utility. Second, the results imply that when firms increase the number of module levels, they should typically offer consumers more additional options in the most popular range of a module and fewer additional options at the extremes. Third, firms should present the price only at the total product level rather than at the module and product level. This approach reduces complexity and increases product utility. Fourth, firms should offer a default version that consumers can use as a beginning point for mass customization, because this minimizes the complexity to consumers. The best default version to begin with is a base default version; which enables the consumer to most closely approach his or her ideal product because when consumers are presented with an advanced default, they may buy a product that is more advanced than they actually need.
The authors also found that expert consumers are excellent targets for mass customization offerings. Expert consumers experience lower complexity in mass customization, and complexity has a less negative influence on the obtained product utility in the mass customization process than it does for novice consumers. In general, reducing complexity in the mass customization configuration is a promising strategy for firms, because it not only increases the utility of the entire process for consumers but also enables them to compose products that more closely fit consumers’ ideal product.
Biography
Benedict G.C. Dellaert is Meteor Research Chair and Professor at the Department of Marketing at Maastricht University, the Netherlands. Previously, he was Associate and Assistant Professor of Marketing at Tilburg University, the Netherlands, and a senior lecturer in the Department of Marketing at the University of Sydney, Australia. He holds a masters degree in technology management and a doctoral degree in technical sciences (urban planning), both from Eindhoven University of Technology, the Netherlands. His research interests are consumer decision making, consumer–producer interaction, and retailing and tourism. His work has appeared in Journal of Interactive Marketing, Journal of Marketing Research, International Journal of Research in Marketing, and Marketing Letters. He has also published in the field of tourism in journals such as Annals of Tourism Research and Leisure Sciences.
Stefan Stremersch obtained a doctoral degree in economics and business administration from Tilburg University in 2001, after which he joined Erasmus University Rotterdam, the Netherlands, as Assistant Professor of Marketing. In 2004, he was promoted to Professor of Marketing at Erasmus University Rotterdam and was appointed Visiting Associate Professor of Marketing at Goizueta Business School, Emory University. He is also Fellow of the Tinbergen Insitute and the Erasmus Research Institute for Management (both in the Netherlands). At Erasmus, he recently received the Research Award, which is given yearly to the most productive researcher across all schools and programs (approximately 800 faculty members are eligible for this award). His current research interest is in marketing high-tech products, innovation, and new product growth. His work has appeared in Journal of Marketing, Journal of Marketing Research, Marketing Science, and International Journal of Research in Marketing. His research on international new product growth was widely covered by the national and international press. He has won major awards, such as the Harold H. Maynard Best Paper Award of Journal of Marketing (2002), and major research competitions, such as the MSI & IJRM competition on global marketing. He was also granted prestigious fellowships, such as the Marie Curie Individual Fellowship of the European Union.
J Marketing Research, Volume 42, Number 2, May 2005
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