I just took a quick look at a new mass customization player, after @evolvex tweeted me about their offering. Evolvex’s website looks great - they have simple furniture, and you can customize openings, colors, legs and more. Prices seem pretty reasonable, cheaper than US based Inmod.
They asked for advice on Twitter. Check out their site and let them know. What advice would you give them?
I took this photo from an Automotive Shopping Behavior Study from Google. The graph compares what people usually do when they visit the website of an OEM (=original equipment manufacturer and in this case mostly the car company’s website).
It turns out that the most popular activity on those websites is to play with the configurator. In 2010, about 35% of all visitors to a car website ended up building their own car. That’s huge - especially since creating your own dream car seems to be even more popular than looking for offers!
However, keep in mind that this only supports the idea that “creating your own” is fun - something we know from The Customization 500 study. What is also interesting in this chart is that the popularity of “build your own” dropped dramatically - from nearly 45% to approximately 35%. At the same time “search inventory” is the only activity that is stable. Now, we don’t have the data to really understand why that is - it could be that the website visitors are more practical in 2010 compared to 2009 because they are more likely to afford cars now, or maybe there were so many deals that customers just wanted to take advantage of them quickly instead of waiting to receive their custom built car. It’s something to look out for though - how is the interest in design-your-own changing over time?
What do you think?
Mass Customization is a steadily growing trend with more and more companies offering personalized or customized products. But how big is this opportunity really?
After hearing that Spreadshirt nearly doubled its US revenue this year, I decided to do a bit of research to see how much money really is in this market. A lot of customization companies are startups and don’t disclose their revenues, but there are exceptions:
Element Bars, the custom energy bar maker, was on the TV show Shark Tank and as a result is discussing revenues publicly. In 2009, the founder Jonathan Miller estimated yearly revenues to be around $100k.
Another rather young startup, Gemvara, reportedly has revenues around $12 million according to a BostInnovation article. It’s important to keep in mind though that the average order size for the personalized jewelry company are larger than for most customization websites.
I’ve only heard rumors about the revenues My M&Ms generates for Mars, but they should be around $10 million per year, with the majority being earned just before the holidays. Compared to the overall revenues of Mars of about $30 billion, the personalization business must seem like a pet project to them.
Spreadshirt, the company mentioned above that doubled their US revenues, now estimates 2011 revenues in the US at about $20M, with their 2010 global revenues having been $42, of which I’d expect the most to be generated in Germany.
Spreadshirt’s biggest US competitor, Zazzle, reported $20M revenues in 2006. I checked out Zazzle’s website traffic in the past, and they had about 1M visitors every month in 2007, and now get more than 4M visitors per month. That would imply that they quadrupled their revenues to a rough estimate of $80M per year.
One of the surprises in my research was Personal Creations. The aesthetically not very pleasing website generated $50M in 2007 according to Internet Retailer.
Danny Wong reported on NikeiD contributing more than $100M to Nike’s 2009 revenues. While that’s little compared to the $2.5billion Nike makes in a year, it’s quite a chunk of the $260M total web sales revenue of Nike. Keep in mind that those are international revenues, not just for the US market.
The biggest suprise however were Shutterfly’s revenue figures. An article from only three days ago describes their Q3 2011 revenues for personalized products alone to have been $57M, which would imply a yearly revenue of approximately $230M. The revenues were also up 56 percent. Even if we assume that there was already some holiday business in there, that’s an impressive number.
The “So-What”? Mass Customization is a business with both short term (revenue) and long term (growth) potential. Are you going to be part of the trend?
I recently visited in Chicago, and my friends, knowing that I’m all about mass customization, took me to see iCream, a customized ice cream shop. Unfortunately it was already closed, but I was able to take some pictures and the website is super informative - if you want to learn more, watch the Food Network video they have posted on their home page.
iCream is fascinating because so far, we’ve only known ecreamery, which takes your custom ice cream order online, makes it and then ships it to you. iCream uses liquid nitrogen to create your custom order right then and there for you to take. You choose flavors, toppings and even the color you want your ice cream to have, they mix it and then blast the liquid nitrogen over it to turn it into ice cream. With the customization options that iCream offers, you can make 256,00 different ice creams. You can also make customized puddings which come nice and hot - a smart choice for a city like Chicago, where the winters get brutally cold.
On a personal basis, what I also liked a lot about iCream was that it was started by two Chicago Booth graduates (which is where I went to business school before launching chocri in the USA). Maybe there’s a link between Chicago Booth and customization?
Awesome to see another big company push their customization efforts. Coca-Cola invested 100 million into customization last year. Although I’m not convinced about the product yet - which sodas could I possibly want to mix to get something tasty?
(Image from Mashable, see link)
Ralph Lauren has offered custom polo shirts for a while now, but they launched the “Design Your Own Collection” in one of the largest department stores in Europe (the prestigious KaDeWe in Berlin) with a huge show. The show in itself isn’t directly related to customized products, in fact it is a refitted 4D video mapping show Ralph Lauren has used in New York and London before (video mapping is a projection technique that lets you turn uneven surfaces into a video display).
What I think is tremendously interesting about this is that Ralph Lauren decided it was worth a lot of money to launch their customized product with a bang in Germany. It tells you that the US company sees a lot of potential in the German market in respect to customized polo shirts, a fact that doesn’t surprise me as Germany is still a leader in the customization arena.
In Spain, design your own clothing via 3D simulator
Design-your-own initiatives have regularly featured on Springwise over the years, and recently we came upon another interesting example. Set in Spain, Crearmoda allows users to design their own clothing and then offer up those designs for voting and incorporation by others. READ MORE…
The next mass customization conference, MCPC 2011, is rapidly approaching - it is scheduled for November 16-19 in San Francisco (official info here).
The motto of the conference is “Bridging Mass Customization and Open Innovation”, and as always, it is organized by Professor Piller and his fellow scholars.
The conference will be a great opportunity to meet other entrepreneurs and thought leaders in the field of mass customization, and over 45 sessions and 130 different presentations allow for a focused interaction. What I also particularly enjoyed at the last conference at MIT and what is bound to return are discussions of the newest research from scholars such as Prof. Piller about mass customization and open innovation.
Check out this flyer for all the important info.
Personalized coffee blends, shipped weekly to the door
The combination of personalization and home delivery is an irresistible one in virtually any product category, and coffee is no exception. Aiming to provide java lovers with an alternative to the mass-market brands that dominate most supermarket shelves, EightPointNine is a UK company that lets consumers create their own custom blends and then have them shipped each week directly to their door. READ MORE…
As you know, I’ve been wondering a lot why mass customization is so much bigger in Germany than in the US, and my blog post (see link) tries to answer that question. Recently, another idea came to my head: Could it be that Germans are culturally more interested in creating their own?
What brought this idea to mind was that I had noticed for quite a while now that Americans and Germans have very different ways of building houses. In the US, houses are built by companies, who plan the houses and then sell them during and after the construction. It’s quite efficient, and the producers have all sorts of data on what the majority likes, which they use when they build many and many of these houses.
In Germany, people tend to buy a piece of land and then proceed to build the houses themselves - sometimes with similar companies in a turnkey project, sometimes with many different contractors. What’s different about the German approach is that the house buyers/ builders are very involved in the creation and its details: Even if it’s a turnkey construction, they usually pick everything from floor tiles to door handles.
Now, to throw this crazy idea out: Could it be that Germans just like to be more involved in the the creation of the “stuff” they consume? Could it be that Germans experience a form of co-creation in several aspects of their lives and are thus more likely to (a) get excited when a design-your-own website launches and (b) more likely to launch such a business themselves?
How much of the proliferance (at least relatively) of mass customization in Germany is due to
?
Would love your thoughts!
This weekend I was told a story which, although I’m kind of ashamed to admit it, because holy shit is it ever obvious, is kind of blowing my mind.
A friend of a friend won a free consultation with Clinton Kelly of What Not To Wear, and she was very excited, because she has a plus-size body, and…
… had to take this down because they’re in “stealth mode”. Sorry. Email me (carmen.magar at gmail) or Dave Sloan if you’re looking for a job in the mass customization world!
2 Questions for Peter Weijmarshausen from Shapeways.
Shapeways recently moved to New York from the Netherlands to build their marketplace of 3D printed objects. Just as Makerbot is revolutionizing 3D printing by making the printers themselves more accessible, Shapeways is really groundbreaking in allowing normal people like you and me to design something and have it printed by them. I met with Pete last week, and asked him these two questions:
1) Tell us a bit more about how you can make your own 3D object with Shapeways
Peter talks about how you can completely design your own object, create one with a bit of help and personalize an existing piece with Shapeways
2) What are the differences between European and American consumers?
Peter emphasizes that differences between users are diminishing as the service becomes more and more global, but that Europeans are more enticed by the freedom of creating something with Shapeways, whereas Americans are more excited about making money with their own creations.
Apologies for the background noise.
—
An article in the New York Times from 1982, titled: “Study Says Technology Could Transform Society” about this time when every home might have a two-way videotex (computer terminal with internet connection), predicting mass customization.
Pretty cool.
I went to SXSW this year but happened to miss a really cool panel on Recommendation Engines. Luckily, it was recorded here. I figure that most of you have companies that allow for an endless number of combinations, so I think that some of the lessons from this panel might be interesting to you, too.
What I had in mind when I took notes from the recording is that MyCereal.com, before it shut down, didn’t ask consumers to pick the different ingredients for their cereal, but rather asked them questions such as “Do you like nuts?” or “Do you want to lose weight”, and then gave the users recommendations based on that. This is a new twist on the idea of a configurator: Rather than letting the consumer really design their own, you create a product for them that they can then alter. That is also one of the reasons why NikeiD is so successful: People start customizing when they find something in the standard catalog that they kind of like - with NikeiD they can make it truly perfect.
So, here are the lessons from the panel:
LESSON ONE: Make it simple
Pandora realized that the radio is an inherently simple experience: You press a button, and you get music. They had a lot of ideas for features and more control for the user over time, but found that it was important to keep the experience simple and accessible to all users. I think that translates into customization - don’t ask your consumers to do too much “work” before giving them anything (or at least try to make it really seamless and fun!)
LESSON TWO: Offer both broad and close matches
Not everyone knows yet what exactly they want. YouTube found that most of the searches on the site are broad, and so in their recommendations on what to “watch next”, they both give close matches to the content of the video as well as broad matches to the overall thematic cluster or the type of video. So as I’m thinking of cereal recommendations, I imagine a cereal that exactly matches your preferences, as well as one that has maybe been created by a nutritionist, that’s very delicious but maybe doesn’t have all the ingredients you indicated beforehand.
LESSON THREE: Provide users context why you recommend what
You could have a black box (as in: a complicated algorithm) that spits out recommendations that you want your users to eat without asking questions. Both Pandora and StumbleUpon however recommend to keep it comprehensible to the user why you recommend what - not only because users like that more, but also because they found it easier to innovate and keep making it better by keeping it traceable. All of the companies found a way to measure how successful their recommendations were.
LESSON FOUR: Make it social, but not too social
Social recommendations are for example when you connect to Facebook, and now the cereal mix that you see has been liked by a friend. Or the cereals mixed by friends just rank higher on the list of recommendations that the user gets. This is a great marketing tool: Not only does it build trust in the product (it’s easy to show data that people are more likely to click on something they friends “liked”), it’s also a starting point for a conversation with a friend, enforcing the connection to the brand or product. Also, in a weird way, influencers are turned on by the fact that no one has liked something yet - they feel that they discovered something valuable that they can share with their friends.
At the same time, the panelists stressed the importance of serendipity, and they suggested not getting all recommendations from a social graph - because then users won’t get the “really wacky things” as often.
LESSON FIVE: Tom Conrad is funny and insightful
Tom Conrad, the CTO of Pandora, is hilarious. He’s also extremely insightful, and one of the thought leaders in personalization. Follow him at @tconrad on Twitter and go to a panel if he’s talking - I first met him at the Mass Customization Conference at MIT in 2010, where he was a fellow presenter.
Want to get started?
All the panelist companies are building their own native recommendation engines, but if you want to plug into an existing taste graph, they recommend Hunch.
What could be simpler than a white tank and jeans, this outfit is perfect.
Now I just have to find an excuse for the rest of the year.
Merci Κοnstantina!
RT @ThirdEye3 Oh, yes! via @helena_chari ...
h/t @andrewburnett
large custom laptop messenger bag
vinyl shine bright blue / white / bright blue
created by TB2 in Singapore, Singapore
customize this bag
This is how you look polished in jeans! We love this look.
Quirky, founded by Ben Kauffman in 2008, is one of my favorite examples of mass customization and user-generated...
Birthday mini-cupcakes! From Baked by Melissa in SoHo. (Taken with instagram)
I just made and named (I love that you can) several chocolate bars on Chocri, which is an amazing custom chocolate bar company, but I just wish...
