Mass Customization Program Research Articles

Self-design fun: Should 3D printing be employed in mass customization operations?

Today, in the market with ever-changing consumer preferences, three-dimensional (3D) printing is becoming an overwhelming trend. In this paper, we explore the use of 3D printing in mass customization (MC) programs. We consider the case when 3D printing brings extra self-design fun to consumers, which is highlighted in MC practices of the auto company BMW and the furniture company Poltrona Frau, and also changes the cost formula (i.e., the marginal product variety cost) of the MC product. In addition, the roles played by the risk attitudes of the MC manufacturer and consumers, consumer returns, as well as consumers’ time sensitive behaviors, are also uncovered. We find that under the case with a low consumer's willingness to pay for the traditional “ready-made product variety enjoyment” (RPVE), even the maximized product variety level and the additional self-design fun cannot make the 3D printing based MC more profitable. In addition, compared to the markets with risk-averse and risk-neutral consumers, the 3D printing based MC can increase more MRBs and a higher consumer surplus by simultaneously highlighting the high self-design fun and the high RPVE in a market with risk-seeking consumers. The high flexibility and responsiveness of 3D printing also shows its advantages in remanufacturing the consumer returned MC items and enhancing MC programs’ overall lead-time. Finally, applying 3D printing in creating molds can also help the MC manufacturer tackle demand uncertainties. These findings all provide a good reference to the application of 3D printing in MC operations.

Enhancing consumer value of the co-design experience in mass customization

This research examines the extent to which the consumer’s perceived value of the co-design experience influences satisfaction with that experience and loyalty intentions toward the online mass customization (MC) program, and whether the consumer’s thinking style during the co-design experience affects the perception of value. A total of 178 millennial consumers used Converse’s “Design Your Own” MC program, completing a survey regarding their co-design experience. Results validate the positive (negative) influence of control and enjoyment (complexity) on satisfaction with the co-design experience and the positive impact of satisfaction on loyalty intentions toward the MC program. Additionally, individual thinking style influences perceived value. Experiential thinking during the co-design experience positively (negatively) influences control (complexity) and has no significant effect on enjoyment, whereas rational processing increases complexity and enjoyment, exerting no significant effect on control. Managerial implications of these results can help providers build value-laden, MC co-design experiences.

Influences of supply chain finance on the mass customization program: risk attitudes and cash flow shortage

AbstractIn recent years, to satisfy diversified customer needs in the target market, an increasing number of brands have launched mass customization (MC) programs as one of their core operations strategies. The production process flexibility and personalization degree of customized products (i.e., the MC products) have thus become key to the success of MC schemes. In the meantime, however, considering the high market uncertainty in consumer preferences and the challenges from the production process, there are plenty of risks in MC operations. Hence, in this paper we develop a game‐theoretic model consisting of an MC brand and an upstream manufacturer to identify the influences of supply chain finance (SCF) on MC programs. The influences brought by the risk attitudes of both MC brand and manufacturer are analyzed. Besides, an extra interest rate for raising the working capital for production (e.g., from the bank) at the manufacturing level is also considered in this paper to address the impact of cash flow shortage. We find that when the positive sensitivity of the market demand with respect to the modularity level of the MC product is sufficiently high, the optimal product modularity level of the MC product increases with the MC brand's degree of risk averse. In addition, it can also be observed that when both the market demand's positive sensitivity to the modularity level of the MC product and the MC brand's opportunity cost rate for placing the advance order are sufficiently high, any increase in the risk‐averse degree of the MC brand or the manufacturer will lower the manufacturer's optimal wholesale price of the MC product as well as the MC brand's optimal rate of the advance order. Furthermore, the higher the interest that the manufacturer needs to pay (such as to the bank) for raising the working capital for the MC production process, the lower the optimal wholesale price of each finished MC product will be to help the manufacturer raise more money through the advance order placed by the MC brand. These observations complete the findings in the extant literature and provide important managerial insights into managing MC operations.

Benefits of mass customized products: moderating role of product involvement and fashion innovativeness

The objective of this study was to explore impacts and benefits of mass customized products on emotional product attachment, favorable attitudes toward a mass customization program, and the ongoing effect on loyalty intentions. This study further investigated how benefits, attachment, attitudes, and loyalty intentions differed as a function of involvement and fashion innovativeness. 290 female online shoppers in South Korea participated in an online survey. Results of this study revealed that perceived benefits positively influenced emotional product attachment and attitudes toward a mass customization program. In addition, attachment positively influenced attitudes, which in turn affected loyalty intentions. This study also found that benefits, attachment, attitudes, and loyalty intentions were all higher in highly involved consumers (high fashion innovators) than those in less involved consumers (low fashion innovators). This study concludes with theoretical and practical implications for mass customization programs.

The effects of e-mass customization on consumer perceived value, satisfaction, and loyalty toward luxury brands

As mass customization programs are becoming ever more common among luxury brands, this study seeks to identify the dimensions of consumers' perceived value gained and to examine the relationships between consumer value and satisfaction and between satisfaction and loyalty in an online context. Three hundred and three female online shoppers in South Korea participated in a web-based survey. The findings revealed that hedonic, utilitarian, creative achievement, and social value influenced satisfaction with the customization, which in turn influenced brand loyalty. The relationships between consumer value and satisfaction differed depending on the consumer's past loyalty and need for uniqueness. These results have practical implications for developing effective customization programs for luxury brands in the online retail industry.

THE EFFECTS OF E-MASS CUSTOMIZATION OF LUXURY BRAND: PERCEIVED VALUE, SATISFACTION, AND LOYALTY

Mass customization refers to a strategy whereby online retailers provide individually tailored products and services to their customers and has been implemented by many retailers with the Internet technology. Many luxury brands such as Bottega Venetta, Louis Vuitton, and Salvatore Ferragamo, provide customization programs to better serve their customers, from engraving their initials on a product to creating a new design of a product. However, the expansion of the customization program to the luxury brands raises potential risk, such as loosening the brand identity and inability to satisfy customers. Despite high interests in mass customization programs and popularity of luxury brands, the effect of mass customization in luxury brands has not been explored. Addressing this gap in the literature, this study attempts to investigate how customized products of luxury brands influence perceived value, satisfaction, and loyalty. In addition, this study explores how consumers’ past loyalty toward a luxury brand influences perceived value of the customization.Hypotheses of the study were (1) Perceived value of a mass-customized product has a positive influence on satisfaction with product customization; (2) Satisfaction with product customization has a positive influence on brand loyalty; (3) The influences of perceived value of a mass-customized product on satisfaction and brand loyalty are different as a function of a customer’s past loyalty; (4) The influences of perceived value of a mass-customized product on satisfaction and brand loyalty are different as a function of a customer’s need for uniqueness.The research strategy of this study was survey methodology and the sample of the study was online shopping consumers. Online questionnaires were collected by an online survey firm. After visiting ‘BURBERRY BESPOKE’, a mass-customization program of a luxury brand, survey participants were asked to answer the questionnaire. The instrument tapped perceived value of a mass-customized product, satisfaction with product customization, past/future brand loyalty, and need for uniqueness.A total of 304 female online shoppers participated in the survey. The result of structural equation modeling found the positive effects of hedonic value and utilitarian value on satisfaction with product customization and the positive effect of the satisfaction on brand loyalty. The result of multiple group comparison analyses revealed the moderating roles of past loyalty and need for uniqueness in influencing the effects of perceived value of a mass-customized product on satisfaction. These findings of the study contribute to the literature in luxury brand retailing fields and suggested managerial implications to luxury brand retailers.

Optimal Return Service Charging Policy for a Fashion Mass Customization Program

Mass customization (MC) service is a pertinent industrial practice in the fashion industry. To foster trust and enhance demand, some brands now allow dissatisfied customers to return the MC fashion product for a full refund minus a service charge. The service charge is a measure to avoid the abuse of the return right and to subsidize the operations cost (e.g., shipping) and loss from the return. Motivated by this observed industrial practice, this paper analytically examines the optimal return service charge policy. We separate the study into two cases—those of risk-neutral and those of risk-averse MC companies, respectively. For each case, we derive the closed-form expression of the optimal return service charge, and we conduct analytical sensitivity analysis to illustrate how different important parameters in the model affect the optimal return service charge. In addition, by comparing the two cases, we reveal how the MC service provider's level of risk aversion affects the optimal return service charge policy. Finally, we derive the conditions under which it is optimal to offer a zero return service charge (i.e., free return with a full refund). These conditions provide insight on the real-world practice in which some fashion companies offer free return service to their registered members but not to every customer.

No Refund or Full Refund: When Should a Fashion Brand Offer Full Refund Consumer Return Service for Mass Customization Products?

We analytically explore in this paper the consumer return policy under fashion mass customization (MC) program. To be specific, we model the stochastic fashion MC program with the consideration of consumer demand uncertainty. If a consumer return policy is implemented, we further consider return uncertainty. By modeling the optimization objective of the risk averse MC fashion brand via a mean-variance approach, we derive the closed-form optimal solution under each case. We then conduct both analytical and numerical sensitivity analyses. For the scenario with full refund and return, we reveal the analytical conditions under which the optimal retail price and the optimal number of options available for customization (called the “optimal modularity level”) vary monotonically with respect to the salvage value and the return service charge. For the scenario when there is no refund and return, we show that the optimal retail price and the optimal modularity level are decreasing in the MC fashion brand's degree of risk aversion, the demand uncertainty, and the price-demand sensitivity coefficient. In addition, our numerical analysis indicates that whether the risk averse MC fashion brand would prefer offering consumer return with full refund to no return depends heavily on the demand-return correlation (DRC) parameter.

Using distributed search methods for balancing mixed-model assembly lines in the automotive industry

Currently, modern companywide PC networks usually possess significant unused calculation capacity. Since the connected personal computers are mainly used for office applications, considerable off-peak times occur. Consequently, in order to solve planning problems more efficiently, it is promising to apply distributed search procedures that make use of those available off-peak times. This applies in particular to complex problems where insights into the structure of the solution space are lacking. The paper at hand illustrates the application of distributed search methods to automotive assembly line balancing. Modern mass customization programs in the automotive industry frequently comprise more than a billion theoretical variants. Since this causes an oscillating capacity demand at the line, deliberately designing the layout of a mixed-model assembly line is of significant importance. The paper at hand provides a new mixed-model assembly line balancing approach that integrates specific aspects relevant for the automotive industry. However, by integrating several $${{\mathcal NP}}$$ -hard subproblems like a detailed personnel planning or a flexible process planning of each task, the resulting model has significant complexity. Consequently, in order to find appropriate line layouts in reasonable time, specifically designed distributed solution approaches are provided and evaluated. Among these approaches, particularly the use of a specific clustered Tabu Search algorithm attains promising results. By making use of an adaptive dynamic load balancer, substantial improvements of the solution quality can be obtained even under unfavorable circumstances like oscillating background loads in the PC network.

Customized Products: A Competitive Analysis

This paper investigates the competitive market for mass-customized products. Competition leads to surprising conclusions: Manufacturers customize only one of a product's two attributes, and each manufacturer chooses the same attribute. Customization of both attributes cannot persist in an equilibrium where firms first choose customization and then choose price, because effort to capture market with customization makes a rival desperate, putting downward pressure on prices. Equilibrium involves partial or no customization. In partial customization, rival firms do not differentiate their mass-customization programs: If firms customize different attributes, many more consumers are indifferent between the two firms. The elasticity of demand is increased and the resulting price war makes differentiated customization unprofitable. If firms customize the same attribute of a two-attribute product, they should concentrate on the attribute with the smaller heterogeneity in consumers' preferences. We incorporate consumers’ effort in portraying their preferences as a cost of interaction and provide public policy findings on the well-being of these consumers: When this cost is low, consumers are better off with customization than with standard goods, but firms choose too little customization. The loss in consumer surplus is sometimes captured by the firms, but for low interaction costs, firms' profit-driven behavior is economically inefficient.

Acceptance of Mass Customization of Apparel: Merchandising Issues Associated With Preference for Product, Process, and Place

The purpose of our research was to examine apparel merchandising issues associated with mass customization. A questionnaire was developed to explore preferences for mass customization product, process, and place that have the potential of affecting success of a mass customization program. The questionnaire was administered to a convenience sample of 131 college students. Data were analyzed using descriptive statistics, t-tests, McNemar tests, within-subject ANOVA, and Bonferroni multiple comparisons. Successful mass customization of apparel at retail is dependent on identification of appropriate dimensions of product, process, and place. Our implications address merchandising issues associated with customer involvement in customizing design and fit of apparel products in retail store settings.

Mass customization – needs to go beyond technology

In recent time, mass customization strategy is considered in some industries as those trends, if not taken up, that might make firms lose their markets to the competitors. Thus, managers concerned with strategic issues might adopt new technology as the only means of implementing this strategy. Often they might make an error in doing so. Mass customization is a completely discontinuous leap from mass production and requires a major paradigm shift and breakthrough thinking. Understanding customers is the starting point, not the dizzying possibilities of technology to produce variety that nobody wants. Mass customization requires careful preparation in every stage of the supply chain and also enriching buying experience of customers. Innovation, quality improvement, time, flexibility, and cost management in every stage are essential pre-requisite of mass customization program. This paper critically analyses some of the issues of mass customization program and suggests measures for successful implementation of a mass customization strategy.