Toward Mass Customized Product Deployment in E-Commerce: The Modularization Function and Postponement Strategy

Abstract

Strategically deploying customized products in an e-commerce environment not only helps businesses respond with greater agility to customer needs and strengthen their market position, but also helps businesses gain competitive edge and increase profitability. Underlying successful mass customization within the digital marketplace, a firm needs a methodology for striking a balance between the degree of customization and product pricing and delivery time—a critical supply chain issue. Providing either too much or too little customization can negatively impact both the business and the customer. This study introduces a decision-making method for product customization. This method takes into account the level of customization, production costs, and the product delivery time and applies the concept of postponement strategy to the product supply chain to boost overall supply chain effectiveness and customer satisfaction. Bicycle customization is used as an example to demonstrate the feasibility of the new approach to determine the optimal level of customization in product deployment.