With the new paradigm of mass customization in business, consumers get to make the decisions, and are therefore more likely to be satisfied with their purchase. It allows for a direct connection between the manufacturers and final consumers, allowing for the final product to better reflect the consumers wants and needs. Years ago when mass production was the dominant, this idea would be unheard of due to the expected increase in costs. But with increasing technology, more specifically the Internet, the needs of the individual consumer can be achieved and still maintain a price compatible to that of mass productions.
Since the days of Henry Fords “any color so long as its black” motto of mass production, products and services have come a long way. Internet technology is a necessity for the success of mass customization. Two important points to emphasize when companies are implementing the new paradigm is the representation of the product and the underlying product attributes. Meaning it is necessary for the individual to feel a connection between themselves and the packaging, positioning, and imagery used to describe the product.
Companies can implement different strategies to achieve mass customization. One being Collaborative Customization with mostly involves B2B ecommerce. It provides consumers with a range of alternatives in the configuration of the product. A popular example of a company that has succeeded in this is Dell. Another form of customization is Cosmetic Customization, which is simply a change to the exterior of a standardized product. The iPod is very popular in this sense, where buyers can choose the color of their iPod and have designs or names picked out to have stamped on the backs. Transparent Customization is slightly more complex, changing the function of the product all together based on the individuals’ behavior, considered to be the complete opposite of cosmetic. And lastly Adaptive Customization, which is found online and is used to narrow down results to more specifically satisfy what the consumer is looking for. A less confusing way to understand this concept is websites like weather.com, where visitors don’t necessarily want the whole nations weather so they enter their specific zip code to narrow it down to the weather in their area.
BagDADDY is another company that is implementing the ideas of mass customization. They emphasize to visitors of their website that “No longer will you be faced with the knowledge that your handbag is but one of many duplicates. No longer will you need to accept conformity,” giving power to the buyers with the ability to design and choose their own bag specifications (Anderson). Also their slogan being “its not your mothers handbag” touching on the one thing women dread, turning into their mothers and further personalizing their company. It is specifically targeted towards women, outside of the obvious that mostly women wear handbags, but also because women appreciate fashion, and having that “one-of-a-kind” accessory.
In an article shown on DesignIntelligence by Tim Crayton, he helps to give a better understanding to the way roles are changing due to mass customization, and further explains the different forms. He describes the consumers as silent designers or non-designers who determine design outcomes. Very much so like BagDADDY consumers. Within the article the importance of the changes within production and consumption was emphasized, terming future consumers as “prosumers.” Meaning they are both involved in consumption and production. The difference between the forms previously explained, of mass customization, he describes is simply at which stage the consumer becomes involved. It is to which extent the process is transparent or collaborative and whether the consumer only has say in design, fabrication, assembly, or post-production. With more design power on the consumers, company’s efforts are shifting from designing a specific unchanging product to designing changeable product platforms.
BagDADDY is implementing the collaborative customization. It is considered to be the most direct use of customer and company interaction. Customers can go onto the BagDADDY website and ultimately pick through a range of possible product choices. They provide flexible manufacturing, which in Craytons article was described as a key aspect, in order to provide their buyers with a one-of-a-kind product. Even on their website they warn, “because each bag is custom made by hand, dimensions may vary slightly.
Once you start looking through the products they offer you can choose the general type of bag your looking for, from a scholar bag to a diaper bag. Then within that type they have further different style options. And when you find the one that fits your needs it shares with you what you as the consumer get to have say in, including the bags fabrics and handles. In addition to what you can choose it also shares what the restrictions are, and whether or not different little accessory options like ribbons and buttons can be added in. They successfully fit into what experts define as mass customization. With their implementation of customer co-design it is considered the “core element that differentiates mass customization from other strategies (cyLEDGE).”
By allowing consumers to pick and choose their specifications, BagDADDY is potentially saving money. It is doing away with the troubles of carrying inventory, when otherwise they wouldn’t know what the exact demand of the consumers is going to be (Flynn). But all the while leaving consumers with a perceived higher value, thanks to the relationship established through customer satisfaction. Studies are showing that the more companies allow consumers to specialize the products, the higher the satisfaction of the buyer.
The way that BagDADDY has executed their customization in bag manufacturing, in my opinion gives them a competitive advantage against other companies. To support this belief, a survey done by the Economist Intelligence Unit [EIU] at the end of 2005, showed that 59% of respondents think that the ability to customize products and services is a crucial source of competitive advantage (Cisco). In addition, complex interpersonal interactions were viewed of high importance towards the performance of customer service to 88% of survey respondents.
Complex interpersonal interactions are another aspect of BagDADDY that I think has been successful. Not only do they allow the women with the power to be able to design their own bags, they can also work with the company to become a rep and or host parties. Being a party host is easy, and provides rewards like $15 towards free merchandise. To become a rep means that ultimately the consumer has the opportunity to work hand in hand with the company as a sales rep at the “bag parties” and be considered as the companies design consultants. In doing so BagDADDY offers a 15 percent commission rate on sales, with the perks of the ability to work from home, set your own hours and many other highlighted benefits described on their website. More importantly on the customization side, allowing them to use their own creativity to be apart of a company whose bags were shown at the DOVE Awards Celebration, ultimately making them feel of importance to the company. BagDADDY is successful in using customer recognition and reward systems, taking them out of the transactional model of business and into the interactional model (Cisco).
Overall I would say that BagDADDY’s strategy has been a successful one, simply by reading how it started on their website. It started with two women who met at church in 2001, and after coming up with a name and slogan they held an open house in their home. Their first “bag party” started with only four bag designs and they ended up selling to the 150 attendants. Over the next year their bags got out into the masses and followers had to have it. So slowly the demand for the bags increased as they spread across states. After renting a space for production the bags have since exceeded the twos expectations, now with design consultants in 35 states. Despite the fact that they are now spread through most of the nation, simply by looking through their website you automatically get a personal feel from the company. They make it a personalized, down to earth company that consumers would be eager to join and support.
Although BagDADDY is still a smaller company, they are successful to the point where they were recognized in an article published in CNN/Money by Gordon T. Anderson. The article discusses the “Method to the Madness” of Nike’s iD project, a store in Manhattan where only the elite is invited and welcome. But it developed such a buzz that people visited their website where all were welcome to design their own sneaker. It also shares that mass customization has been around for a while now, back to the 1990’s when customers could choose their computers hardware and software.
Outside of electronic field however, as shared in the article, customization has been slower to evolve. For example, within the clothing industry years ago, Levis, a well known company, gave collaborative customization a shot. They introduced to consumers their customized jeans, and ultimately failed, along with Proctor & Gambles 60 million-dollar investment into Reflect.com beauty products. Towards the end of the article he shared other smaller companies that are succeeding in the mass customization market (including BagDADDY). It seems as though the smaller, newer companies that don’t have storefronts seem to be doing better in that they have little to lose, and plenty to gain. Perhaps that would explain the hundreds of websites still up and running to make custom T-shirts.
In a global survey conducted by the EIU at the end of 2005, half of the 1,656 executives surveyed expect that the decline in customer loyalty will be the biggest hazard facing their companies over the next 15 years. So many would suggest that companies should shift their efforts from cost reduction to improving the customer’s experience through interaction. Ultimately, the goal being for the customers experience to present information beyond what is required to complete the transaction, and from there be used to further improve later exchanges. The Paradigm is constantly changing and improving. The aspects of personalization will only grow more complex, and companies are trying to keep up with the wants and needs of the consumers. As far as businesses are concerned “the race is on for sellers to provide them with a unique experience (Cisco).”
