Mass Customization & Open Innovation News

Chocri Announces U.S. Launch -- Customized Chocolate Bars from Berlin

Recently I wrote about the move of Zazzle into the German market. Now a German mass customization company moves to the US, chocri (www.chocri.de). The URL for the US site will be http://www.createmychocolate.com.

The company only recently came to my closer awareness when it won an entrepreneurship award by WirtschaftsWoche, a German business weekly, for their concept of personalized chocolate bars. It is one of the ten or more recent start-ups in Germany which were inspired by MyMuesli to enter the market of mass customized food.

The idea behind the chocri chocolate bar is simple: consumers can choose their chocolate base (dark, milk, or white), and then select "toppings" of their choice to personalize their chocolate bar. Toppings include both the traditional (nuts and dried fruit) and the outrageous (coriander and chives)! Upon checkout, customers can then choose to create a personalized name for their chocolate bar as well as select their wrapping paper.

I have to admit that I am still skeptical about the sustainable value of this business concept, but I am more than happy to accept that I am wrong and that this kind of food is a future of mass customization.

For me, it starts to get interesting when the functional or nutrition value of the food can be adopted to a person's nutrition requirements. But in the moment, hedonistic offerings rule the market, many of them in the field of gifts and presents.

Chocri hopes to benefit from the continuous mass customization trend in the U.S. and will start selling customized chocolate to U.S. consumers in January 2010.

In a press release, co-founders Michael Bruck and Franz Duge say, "Since chocri was launched, we always believed in developing a close relationship with our customers, who are the true creators of chocri; and so this award is not only a recognition of our hard work, but also the generous contribution of our early fans and supporters."

By constantly polling its customers for new ideas on toppings and flavors, chocri has established itself as a receptive, engaging brand that encourages its customers to be involved in the company's decision-making process and growth.

The young start-up, based in Berlin, has already sold 120,000 of its bars since launching last year (about 600-2000 a day, for prices between 3 and 8 Euros), and declares its revenue to be in the mid-six digits.

Zazzle Launches in Germany to Continue European Rollout

Yesterday at around midnight, Zazzle.de went online, the Zazzle platform in German language. Being German, I of course were especially appealed (even if the translation at some places still is bumpy, it is difficult to translate the American startup slang in German, I suppose).

In addition to supporting the German market with full German-language translation, www.Zazzle.de will base its transactions in Euros and buyers will not need to pay additional taxes or customs duties beyond the product price. Customers on the www.Zazzle.de website will enjoy fast delivery of their order to any address in Germany at competitive prices. But the zazzle.de website will be a virtual front end, with all information being managed from the US.

But an interesting feature, and one that make's a lot of sense, is the promise of Zazzle to offer localized merchandising featuring German Sellers and content relevant to the German market. In the moment, this is Oktoberfest beerfest stuff.

The also promise a standard delivery across Germany at competitive prices with delivery typically in 5-7 days, with Express delivery in about three days (hence just a bit slower than Spreadshirt or other Germany-based companies).

I am curious to see how zazzle.de will develop and are happy about another strong case close to my home.

In the press release, Zazzle offers some more information about their business development. Zazzle's recent statistics include:

--  Monthly unique visitors to the Zazzle websites now exceed 12 million;
--  140+ percent year-over-year traffic growth;
--  Total number of members is 5 million+;
--  Total items shipped is more than 11 million;
--  Leading on-demand custom products marketplace in terms of traffic
    rank, page views, and other key metrics, according to alexa.com

PS: Zazzle will present at the MCPC 2009 conference in Helsinki about their recent achievements and future plans!

Custom Jewelry: FORBES Video report about Paragon Lake

I wrote earlier that one of the large trends in mass customization is the creation of a network structure where an intermediary brokers between diverse retailers and manufacturers for custom products. Customax.com or Bivolino Services are good examples for this trend in the fashion industry.

As reported before, Paragon Lake wants to bring this model to the retail world. Forbes just published a nice Video report about them (you have to watch a short commercial before it starts!), with interviews with the key persons behind the concept.

Paragon Lake was founded in 2006 by Matt Lauzon while he and fellow students were at Babson College. They were exploring personalization and other new ways that people shop. They soon realized there was an opportunity to drastically improve the way fine jewelry is bought and sold. Their vision led to the creation of Paragon Lake. On a presentation at the Smart Customization Seminar at MIT in November 2008, Matt introduced his company to a larger audience.

The group's focus on fine jewelry was inspired by a friend's search for a present for his girlfriend. The friend thought that jewelry would be the perfect gift, but considered jewelry shopping experience to be intimidating and overwhelming. After visiting a few local jewelers, he was unable to find a piece that was just right. Hearing his story, Matt realized that technology could not only help fix this problem, but also revolutionize an industry.

Paragon Lake joins consumers, retailers and designers together to create one of a kind jewelry using a special sales application tool with really cool rendering capabilities. The video explains the concept quite neatly.

A good background report about the company is here.

(Updated) Will New Coca-Cola Vending Machine Allow Ultimate Customization at the Point-of-Sale?

Update: Coca Cola just contacted me and revealed the brand name for this venture: Coca Cola Freestyle(TM), see press release below!

Finally a concept could become reality that Joe Pine has described more than 16 years ago (as a future dream scenario) in his book "Mass Customization": The ultimate soda fountain that offers unlimited choice, as Owen Morris in a newspaper article and Tim Stevens in Engadget.com report. (Note: I could not get more information about this concept. But if you know more, please drop me a line as I am very interested in these kind of localized customization devices).

 Currently, your typical soda fountain in a fast-food joint features perhaps eight to ten standard choices, usually offering nothing more exotic than "peach flavored ice tea." These machines work through syrup bags. The restaurant buys a bag from Coke or Pepsi, hooks it up to a soda (water) line and then the fountain combines the carbonated water with the syrup to create your soda. The machines are limited by soda lines, which tend to gunk up with sugar mold, and by bulky soda bags that weigh 30 pounds or more.

The new Coke machine is completely different. Coca-Cola has announced a new soda fountain that can hold more than 100 sodas. That's ten times more than current soda fountains.

The new fountain is like an ink printer with space for hundreds of cartridges. Each cartridge contains a concentrated formula of ingredients. When you press your choice, say Diet Coke, the machine will tell cartridge 12 to release three squirts, cartridge 81 two squirts and so on, then it combines it with carbonated water and you get the same drink as old machines.

But: The new fountains can hold a lot more of these little cartridges, so they can handle a lot more flavors. Coca-Cola promises 120 different drinks, but there could be even more as the technology gets better and the company gets more confident. You think these are way to many choices for a standard drink like sodas? Think again; Already today, Coca-Cola is listing more than 2,800 beverages on their website! And I personally would love to have a German "Apfelschorle" with still water and a 20:80 mix of juice to water … something even waiters have a problem to bring in a restaurant.

The first new fountains are rolling out in Atlanta and California in this spring. Assuming tests there go well and the public loves its overwhelming choices, the new fountains would come to other US cities next year.

But there may be a downside: How will Coke protects its customers from the paradox of choice, when too many options overwhelm our brains and shuts them down from making a decision. Just think of the lines as "the thirsty yet indecisive ponder 15 different flavors of Diet Coke?" (Tim Stevens).

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Update: Press release from The Coca Cola Company on April 28, 2009:

THE COCA-COLA COMPANY INVITES CONSUMERS TO EXPERIENCE “FREESTYLE”
New Proprietary Fountain Dispenser Gets a Brand Name

ATLANTA, Apr. 28, 2009 – The next generation fountain beverage dispenser has a “stylish” new name.

North America today revealed that “Coca-Cola Freestyle TM” is the brand name and logo for its new proprietary fountain dispenser entering market testing this summer.  The fountain’s brand name captures its ability to deliver unprecedented beverage variety to suit any consumer taste – all packaged in an innovative and interactive fountain experience. 

“Coca-Cola Freestyle brings to life the refreshingly positive outlook that has always been associated with Coca-Cola,” said Chandra Stephens-Albright, Group Director of Marketing and Business Development for the brand. 

“It brings back the magic of the fountain of the past, re-imagines it for the future and then takes it a step farther by celebrating the idea that consumers can truly have their say at fountain – with choices tailored completely for them.”

The new self-serve fountains – which represent a complete departure from equipment The Coca-Cola Company has offered before – have been in development for nearly four years.  The sleek new units being tested are touch screen operated, enabling consumers to select from more than 100 calorie and no-calorie brands – including varieties of waters, juices, teas and sparkling beverages that have never been sold in the United States.

The Coca-Cola Freestyle dispenser uses proprietary PurePour Technology™ to make dozens of branded beverages fresh to order, in the same amount of space as the current eight-valve machine.  It will be tested in select quick-serve restaurants in Orange County, Calif., and Atlanta this summer before a wider introduction currently planned for early next year.

"Niching the niche": Observations from my visit at Zazzle's Silicon Valley HQs

How Zazzle is still growing with mass customization despite -- or just because of -- the economic downturn … and ten other facts that make this platform special

I recently had the opportunity to pay Zazzle an extended visit at their Silicon Valley Headquarters. Here is what I learned during this day:

Zazzle was founded by Bobby and Jeff Beaver as students at Stanford University. The unfulfilled need of a user again was the mother of invention: The two brothers wanted to create a cool t-shirt to advertise a party at their fraternity (in order to "draw in plenty of nice girls"). They realized how difficult it was at that time to get high-quality custom t-shirts without having to order larger quantities at a promotions company or to rely on the low quality of heat-transfer at the local copy store. Well, it didn't work out with the girls at that party, but the rest is history:

Since Zazzle's launch in 2003, its focus always has been on technology. It started with unique digital custom printing technologies that allowed the founders to really get high quality products out at a not known quality (at this time). Today, in every presentation Zazzle stresses the fact that being leading edge in technology is what makes them special.

It may be the proximity to the many technology companies in their area that keeps them emphasizing the technology part – but I do not see Zazzle as a technology company – they are a "market maker". In my opinion, their core capability is to create new markets for products that before could not be exploited in any way.

Sheryl Graham called this "Niching the niche". Sheryl is a Zazzle Proseller, making her living by creating products on the Zazzle platform and selling them to others (http://www.zazzle.com/sagart1952) -- most of them appealing just to a very small audience that traditional companies neither can recognize nor capture.

Starting from the scratch without any ballast or old knowledge or constraints, Zazzle created a mass customization ecosystem that has a number of unique features. Here are my ten points that make Zazzle special:

1.    Niching the niches: The unique vale proposition of Zazzle comes from utilizing the broadest possible scope of needs. Each day, about 50K new products are being created, most addressing a very tiny demand – but in total, this sums up. This also allows them to operate with almost no clear definition of target groups or target customer segments: While the "soccer mom" is the single largest customer of Zazzle, it is by far not its majority. The platform is build to cater to all different groups and clients.

2.    Event driven Marketing: The broad scope of users at Zazzle drives a lot of event-driven business beyond the traditional seasons. There is not just the wedding-season, but their has been Obama-Season, Client-#9-Season, Tax-Day-Season and so on … The core business driver is to enable (local) users with some very specific domain expertise to create products immediately for/after a special event in this domain.

3.    24-hour turnaround for most orders: While most mass customizers need weeks to fulfill an order, Zazzle very early realized that being able to process an order in 24 hours opens many more markets (think of the entire last-minute gift market).

4.    Modular manufacturing system: Their manufacturing system (in San Jose, CA) is build highly automated so that it can balance large spikes in demand without accumulating too high cost. In addition, a highly flexible work force allows to cover different demand cycles.

5.    Real-time rendering and focus on user experience: Zazzle has some impressive rendering capabilities that allow the website to create any product in any specification in very high quality virtualization in real-time. While many other mass customizers still work with pre-fabricated pictures, here everything is rendered just on the spot.

This also enables another signature feature: Showcasing all products in different settings: Most products can be virtually placed on many different models. Zazzle realized that not all designs fit to same style of mannequin. This also caters to the broad scope of clients that utilize the Zazzle platform.

Or consider the "stitching simulation videos" when you choose custom embroidery. This allows the user to see how detailed the self-created pictures will be produced – also contributing to the user experience and quality perception of pro-users of the site.

6.    Allowing clients to focus: Strong focus on creating a flexible platform for different kinds of relationships with different vendors. Their theme: "How to allow our clients to specialize on what they are really good at, and still sell an integrated offering at the same time". So, a traditional company like Pittney Bowes (zazzle.pb.com) can create its own custom goods offering on the same platform as a very design-driven initiative like artsprojekt.com. Compare the sites: They look extremely different, but are based on the same platform and fulfillment system.

7.    Relationships with brands: Zazzle has build some very strong relationships with brands like Disney and the Star Wars Enterprise that allowed these companies to go beyond merchandising and offer real "fan-based content".

8.    Openness and opportunity-driven growth: Zazzle created a platform that is flexible enough (with the help of their great engineers) so that vendors can come in and get (almost) any product they would like to offer customized.  There is no general restriction for new products. New assortment creation is driven by the clients and users.

9.    Generating customer knowledge: Zazzle enables brands and established companies to use Zazzle as a platform for experimentation and testing that even makes money. Disney used Zazzle to allow customization of products with the characters of the movie "Cars", and their large retail clients used the popularity of characters selected by Zazzle users to predict the number of merchandises products in large scale. Creating these aggregated customer knowledge became a large benefit for Disney.

10.    Growing strongly despite the present economic downturn: Although Zazzle realizes the slower economy, they still grow with high double digit figures. Corporate clients use the on-demand opportunities in these times as a more efficient way to create special assortments compared to building large inventories. And consumers that postpone shopping for high-priced items still use the affordable Zazzle products to get a high-touch emotional products ("if I cannot afford the diamond ring for my girlfriend right now, I still can give her a great custom made t-shirt as an emotional gift").

But Zazzle also has to focus on a number of challenges:

• Create a site and corporate image that appeals to many different stakeholders, from brand managers at Disney to freelance independent designers in the Gothic Scene, all using the same platform to distribute their products.
• Manage client conflicts: Zazzle enables its corporate clients to extend their assortment into the custom product line, but at the same time, Zazzle also creates competing assortments by other vendors in the same category. This can lead to channel conflict.
• Educate their customers: Being ahead in technology and mass-customization-thinking, Zazzle has to educate it different kinds of users what it is able to do – and what they are able to do with Zazzle.
• To keep technology leadership, continuous investments in the technology platform is required, also including more and more complex integration of new technologies into the current platform.
• How to grow really big: While Zazzle had remarkable growth in the past, it still has to become the Google of products. What is their strategy to put all the existing amazing technologies and market knowledge together and to create really scalable growth beyond the niches?

So I think we should stay tuned what Zazzle (and their equally strong competitors like Cafepress and Spreadshirt) are turning out in the next months … these are some of the most interesting players in the mass customization market out there in the moment.

Context: Zazzle Blog

Prosumer Revisited - A Brief Conference Report and Links to Summaries of Most Talks

Update: In case you speak German, there is a great comprehensive summary of the event here: "Ich bin ein Prosumer - Brigitte Holzhauer berichtet von der Tagung "Prosumer Revisited" in the Magazin Change X."

This week, at the Goethe University in Frankfurt/M, Germany, an interesting conference took place. Organized by Birgit Blättel-Mink and Kai-Uwe Hellmann, two professors of sociology, the event wanted to review the long school of academic thought on prosumers and co-creating customers. The organizers gathered a diverse and interesting crowd of participants that provided insight from many different perspectives. Overall, it was an interesting event, even when I realized that in sociology, the majority of scholars still focused on mapping that the phenomenon of co-creation or prosuming customers exists, while in the management literature, the state of the discussion has moved one step forward in explaining the structures, methods, and contingencies of user participation in value creation.

Axel Brun, a scholar from Australia who participated in the conference, has written a very comprehensive report, summarizing all keynotes and many of the paper presentation in his blog. Axel is a Senior Lecturer in the Creative Industries Faculty at Queensland University of Technology in Brisbane. He has coined the term "produsage" to better describe the current paradigm shift towards user-led forms of collaborative content creation which are proving to have an increasing impact on media, economy, law, social practices, and democracy itself. For more information, have a look at his website, http://snurb.info.

Here are a few direct links to Axel's summaries of the conference keynote presentations:

• My opening keynote of the conference: http://snurb.info/node/970. This is a nice summary of parts of the talk and of my basic argument why user participation in the innovation process is important: to get access to sticky need information of customers.
• Holm Friebe, co-author of my favorite book "Marke Eigenbau". The book is a great summary of all topics I am writing about in this blog, and so was Holm's presentation: http://snurb.info/node/973
  
  
• Kerstin Rieder is the co-author of a rather critical book on the "working customer", that, when it appeared in 2006, seemed to me like a critical and pessimistic review of the self-service society. Missing many of the more recent developments of voluntarily co-creating customers- So I was glad to hear that in her talk, Ms. Rieder did extend the concept and also focused on the opportunities and advantages of co-creation for firms and, equally, customers: http://snurb.info/node/980
  
  
• Johann Füller from Hyve talked about the creation of brands by users. I have heard this talk before, but it again was fascinating to see how user-created brands challenge the marketing thinking of many decades: http://snurb.info/node/977
  
  
• The honorary keynote speaker of the conference was the famous sociologist and scholar of cultural studies, George Ritzer from the University of Maryland. He provided a nice historical overview of the prosuming customer, but -- as most speakers at the conference -- stopped when it got interesting, i.e. when new forms of co-creation emerge. But overall, it was a great experience to listen to Prof. Ritzer live: http://snurb.info/node/976

For summaries of many more talks, go to http://snurb.info/taxonomy/term/104

Using Mass Customization to tune-up standard products: MyTego

In a press report, I read this interesting success story of mass customization provider MyTego. While the numbers reported have to valued based on their low starting point, it nevertheless is a great further example that mass customization makes sense and that the standardization of many products creates a growing after-sales "tuning" market for additional customization. The website is well done. The configurator is rather simple but it worked well and did its job, even if it does not reach the visualization qualities of a Zazzle or Nike toolkit. The main think that was missing on the site is a gallery with examples or staring points. For me, it was rather difficult to imagine how the final device would be look alike and what other designs previous customers made.

The following text is taken form the press release:

MyTego has increased sales an astonishing 311 percent over the short time frame of three years. MyTego.com provides customers with the unique opportunity to custom design vinyl Tego skins online, to place on any and all of their portable electronic devices.  The company has developed a complete patented production system that allows for individual manufacturing with infinite customer choices, with similar economies of traditional mass production.  As portable electronic devices become more and more common with very few customization choices, customers increasingly are looking for custom skins to place on their iPod or iPhone, BlackBerry, Motorola, Nintendo or any other portable electronic device they may own to make them unique.

The man behind this success is Doyle Buehler. He started the parent company, Imbibo, in 2002 in Winnipeg, Canada and licensed the technology to produce the personalized vinyl skins to MyTego Inc, also based in Winnipeg, in 2005.  The following year, 2006, MyTego licensed a European operation based out of Paris, France to start producing Tego skins for the European market.  MyTego reports that approximately 60 percent of their sales are orders from the United States, 20 percent from Canada, and 20 percent from the rest of the world.  Worldwide distribution of Tego skins is accomplished through a unique, patented online design studio that operates in more than seven languages.

Tego Skins are low-profile, protective, printed adhesive vinyl "stick-ons" that are applied to the surfaces of portable gadgets to make them stand out among the many identical devices surrounding them.  Customers can create Tego skins for any and all portable electronic devices including the majority of cell phone models, laptops, video game consoles, ebook readers, skateboard decks and much more. All devices with Tego skins remain fully functional with specific cut-outs for screens, buttons, keys, as well as cutouts allowing access to the device’s battery.

MyTego’s website, www.MyTego.com makes mass customization possible with online design tools allowing customers to create skins with no limitations except for their imaginations.  After the customer has designed a striking Tego skin, it is then manufactured individually to the exact specifications of the customer and shipped direct to the customer.  Tego skins go on easy and come off clean without leaving a residue so that they can be replaced regularly to remain up to date with fast changing trends.

Customization of Music: SongMap helps you to create custom songs

Church music may be one of the most standardized products in the world. Since hundreds of years, church goers use the same songs and rhythms which often become part of the cultural tradition of a society.

Not any more. Last week, LifeWayWorship unveiled the latest innovation in digital music: SongMap, a web-based application that allows users to create custom arrangements of songs and produce corresponding audio files and sheet music.

Lifeway is a service company supporting the Southern Baptist Convention and one of the world’s largest providers of Christian products and services. But despite its religious mission, it uses latest technology and has invented really a world's first-of-a-kind product with its customizable music offering

Well, old-time readers of my blog my remember a similar offering of cutomizable music, but not in this scale and scope.

SongMap is the first web-based technology that allows users to choose specific sections of songs: verses, choruses, transitions, and more ... and then download sheet music and audio files that correspond to the custom arrangement. The technology was developed specifically to meet the needs of worship leaders who want more flexibility arranging songs for church services. At the same time, SongMap has broader implications throughout the mainstream music world.

“SongMap is the first technology that gives users the ability to change songs on the Internet to meet their own tastes,” said Mike Harland, director of LifeWay Worship.

“Some churches need sheet music for a full rock band each week, while others rely solely on accompaniment tracks. We set out to find a way to help these churches create music that suits their congregations. In doing so, we created a new music technology that does what none other has done before.”

Very similar applications could be used by schools, theaters, local choirs, and so on ... however, I don't know whether the creators of this technology would love to see their product used for some raunchy song by 50Cent.

Three years in development, SongMap was created by a team of software engineers and music industry professionals. It involved the largest known recording project in Nashville history. Nearly 1,000 songs and 8,000 mixes were recorded in just 10 months by over 150 professional musicians, vocalists and engineers. The production team then divided the arrangements into more than 500,000 individual segments. From these segments, the SongMap technology allows users to “map” custom mixes of individual songs.

The cost to map a song ranges from $ 1.49 to $1.99 per part. Once a song is purchased, the user has immediate access to the corresponding MP3 file and sheet music. I am curious to learn how this technology is accepted and how it will develop in the next years. I could imagine a Zazzle or Spreadshirt-kind of business model: Some creative people create new songs to address, e.g., a recent trends, and then share their creation with others in their own online song store. 

Context Information:

• SongMap Website
• Springwise on SongMap
• Earlier Posting on similar offering
• More on customized music
• Mass customization seems to be the concept of the year at US Christian enterprises, as also this news article reports

The Top 20 of Mass Customization: A closer view on the agenda of the MIT Smart Customization Seminar

The upcoming Smart Customization Seminar at MIT will gather a great group of individuals representing some of the most advanced and interesting businesses in mass customization today. The seminar is targeting executives in the mass customization market and companies interested in launching a mass customization business or applying some of its principles to boost an established business.

Here is a more detailed look on the program with some comments. Participate at this unique event and register today!

For the full program, go the the seminar's web site at MIT.

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MONDAY, NOV 10, 2008 (starting at 2pm)

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Introduction & opening addresses: Frank Piller & B. Joseph Pine II, MIT Smart Customization Group: Joe Pine and I will start the seminar with two short keynotes highlighting key aspects of matters today in mass customization. We also want to provide a framework how to navigate the two days during the seminar.

Mass Customization Leaders: Adidas, Alison Page, Director, Mass Customization: Adidas' mass customization offering mi adidas is the premier example of custom sports wear since 2001, combining customization in all three dimensions: fit, style, and functionality (performance). Alison Page will talk about the learning of establishing the customization business unit within a global corporation.

Mass Customization Leaders: Business-to-Business Leader
We are talking to one of the most advaced examples of BtoB customization. Come back to see who will be speaking in this slot.

Mass Customization Next Generation: Spreadshirt, Inc. Jana Eggers, CEO
Spreadshirt represents a new breed of mass customization, combining personal creativity with the power of the social web. Spreadshirt has recently made it into the Top 5 European Growth list "Europe's 500". CEO Jana Eggers will share her experiences with leading a major customization brand, connecting average consumers, artists and corporations like Samsung, Coca Cola, or Chuck Norris.

Open Space discussion: Defining your mass customization strategy
Meet with a smaller group of peers to discuss your mass customization challenges and experiences. Groups will be facilitated by a leading professor in the field, providing also first-hand insight into the latest research to master your challenges.

Reception and networking dinner in the MIT Faculty Club

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Tuesday, NOV 11, 2008

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Opening address: William Mitchell, MIT Smart Customization Group, is a Professor of Architecture and Media Arts and Sciences at MIT and directs the Media Lab's Smart Cities research group. Before coming to MIT, he was Professor of Architecture and Director of the Master in Design Studies Program at the Harvard Graduate School of Design. He also taught at Yale, UCLA, Carnegie-Mellon, and Cambridge Universities. He holds a BArch from the University of Melbourne, MED from Yale University, and MA from Cambridge. He is a recipient of honorary doctorates from the University of Melbourne and the New Jersey Institute of Technology. In 1997 he was awarded the annual Appreciation Prize of the Architectural Institute of Japan for his "achievements in the development of architectural design theory in the information age as well as worldwide promotion of CAD education."Mitchell is currently chair of The National Academies Committee on Information Technology and Creativity.

Mass Customization Leaders: Masters in Configuration, Lars Hvam and Niels Henrik Mortensen, DTU and Co-authors of "Product Customization": Lars Hvam and Niels Henrik Mortensen are co-authors of the 2008 book "Product Customization: Designing Configuration Systems". Configuration is a key capability for mass customization. But setting up a configuration system is a holistic task that demands much more than just dealing with IT. Lars and Niels developed a methodology to implement a configuration system that helped pump manufacturer Grundfos to react on customer orders in 3 minutes instead of 3 days. American Power Conversion (APC), an infrastructure provider for data centers, could reduce its delivery time from 400 to 16 days. Learn from these and other examples how the latest methods for designing modular product architectures and configuration toolkits can improve the efficiency and customer satisfaction in your mass customization business.

Mass Customization Supply Chain Enablers: CustoMax.com, Bas Possen, Founder & CEO: "In general, too little use is made of the advantage, that all people are different." That's the credo of Bas Possen who manages Europe's largest network of retailers for mass customization, combining multiple vendors of custom goods and retailers on one single platform, both online and offline. Bas Possen brings more than a decade of experience in mass customization to the meeting, having established a number of successful companies in the field.

Mass Customization Entrepreneurs: Meet the next generation of mass customization: Following MIT's entrepreneurial spirit, we proudly present some of the best upcoming new ventures in mass customization. Learn from the founders what motivated them to invest in a mass customization business and get the latest insights from their research and experiences.

Paragon Lake just secured more than $7 million of additional financing, demonstrating ist leadership in the custom jewelry industry. Tikatok is an award-winning idea that empowers children to create their own books and get them produced in large or small quantities. MyFactory and Proper Cloth are start-ups of resent MIT Sloan School graduates in the field of custom fashion and apparel. Look for their latest ideas how they want to differentiate their sites in a crowded market. Sole Envie targets to become the first company in the US selling custom made footwear to women with a high design appeal.

All companies will be presented by their founders and CEOs and will provide a great opportunity to learn about what's hot in the customization market today and what market & technology trends are coming up.

Matt Lauzon, Co-Founder & CEO, Paragon Lake (Jewelry)
Sharon Kan, President & CEO, Tikatok, Inc. (Children books)
Sasha Revankar, Founder, MyFactory (Fashion)
Seph Skerritt, Founder, Proper Cloth (Shirts)
Monika Desai, Founder, Sole Envie (Women's footwear)

Mass Customization Integrators: Zazzle Inside: How Zazzle's infrastructure enabled Keds to offer custom sneakers rapidly, Zazzle, Inc., and Keds Corporation: Zazzle is the only on-demand retail platform for consumers and major brands, offering billions of one-of-a-kind products shipped within 24hours. Users can instantly create, customize to fit their personal style, purchase, and sell a near infinite array of products online. In an exclusive partnership with sportswear icon Keds, the inventor of the "sneaker", Zazzle created its first line of fully customizable sports shoes. The presentation will share the creation of a new customization assortment for Keds.

Mass Customization Leaders: Swarovski: How a leading international brand co-creates products with their customers, tba, Swarovski, Inc. & Johann Fueller, CEO, Hyve AG:  Swarovski is the luxury brand name for crystals around the world. With sales of more than $3 billion, the Swarovski group is one of the largest players in its industry. Still, Swarovski's organization is very customer-centric. Recently, the company explored a number of co-creation and customization initiatives which will be presented in this talk. The co-presenter of this talk will be Johann Fueller, who was responsible for the realization and implementation of several customer co-design toolkits at Swarovski.

Mass Customization Next Generation: Desktop Factory, Inc., Cathy Lewis, CEO: The goal of Desktop Factory is to make 3D printing as common in offices, factories, schools and homes as laser printers are today. Just as laser printers became ubiquitous in the last decade, so too will new uses for 3D printing emerge as devices become inexpensive and widely available. Customization and personalization is the main driver behind this trend. Started in 2004, Desktop Factory is the leading company to build a manufacturing system for each customer for less than $5000.

Changing the Game: How Video Games Are Transforming the Future of Mass Customization, Ethan Mollick, MIT Sloan School: Some of the world's best configuration toolkits today are not being developed to sell automotives or complex machine tools, but videogames. In his presentation, Ethan Mollick will share the latest insights on configuration toolkit development in this industry and what you can learn from this to develop state-of-the-art toolkits for your business. With David Edery, Ethan Mollick is the co-author of "Changing the Game: How Videogames are Transforming the Business World" (2008, Pearson Education/Financial Times Press).

Mass Customization Next Generation: i-Fashion: The Future of Personalization Today. Chang Kyu Park, Director, i-Fashion Technology Center, Korea and Yongsoo Park, CEO, i-Omni Co. Ltd., Korea: Virtual representations of products and customers are a key capacity of successful mass customization & personalization. They match customers' preferences to products and configurations. The i-Fashion Consortium in Korea operates one of the world's most advanced set-ups of virtual reality. Using virtual models based on an Intellifit body scan, consumers get personalized recommendations of products they may like. At the same time, vendors' efficiency increases due to the virtual -- and not physical -- representation of products for most stages of the value chain. Chang Kyu Park will discuss present achievements if i-Fashion and provide recommendations on using virtual models in your organization.

Open Space discussion: Implementing Mass Customization: Meet with a smaller group of peers to discuss your mass customization challenges and experiences. Groups will be facilitated by a leading professor in the field, providing also first-hand insight into the latest research to master your challenges.

Closing comments by Frank Piller & B. Joseph Pine II, MIT Smart Customization Group

For the full program and registration, go the the seminar's web site at MIT.

MIT Seminar on Mass Customization - Meet the Thoughtleaders in the Field

MIT Faculty Club, MIT Sloan School of Management, Cambridge, MA, November 10-11, 2008

Another event ... but one that we believe will matter and create value: We are inaugurating the MIT Annual Smart Customization Seminar. Its foremost idea is to connect managers in peer-to-peer interaction to foster an intense discussion, facilitated by presentations from industry leaders and the Smart Customization Group faculty. The seminar's core faculty consists of Mass Customization guru B. Joseph Pine II, MIT Design Lab Director William Mitchell, and myself (Frank Piller).

The seminar provides a unique opportunity everyone working on, implementing, or considering mass customization and personalization strategies and technologies (note: it is organized in the style of the MIT Executive Education, so there are no student discounts, etc.).

The MIT Smart Customization Seminar is the only event of its kind in North America and provides an in-depth coverage of one of today's most important business trends. The objective of the 2008 seminar is to take an intensive look on the success factors and "how to do it” aspects of mass customization and personalization.

For more information, the preliminary agenda, and registration please refer to the agenda in the attachment and our seminar web site: http://stellar.mit.edu/S/project/smartcustomization/

Space in the seminar is limited, so reserve your seat today, and also enjoy the early registration discount until October 24, 2008.

Archetype Solutions Launches Indi. New Custom Apparel Company Supplements their BtoB and Consumer Offerings

Indi is the newest spin-off of Archetype Solutions, a company known to many insiders in the field of customized apparel as a premier enabler of mass customization for large fashion brands. Archetype Solutions has spent years studying human bodies and fit to develop an innovative technology that enables the company to determine an individual’s body shape and create a unique pattern to fit their shape. Previously, they used this capability in a BtoB environment to enable fashion brands to create an own mass customization offering.

 In a first business-to-consumer venture, Zafu.com, Archetype then utilized their knowledge to provide an innovative matching service for jeans (see my earlier posting on Zafu, one of the most innovative companies in the customization & personalization domain).

Now they went one step further by founding a custom apparel company, indi, based in Emeryville, California, just across the Bay from San Francisco.

indi enables customers to create apparel which reflects their individual style and preferences. In the moment, indi markets and sells its custom apparel under two brands addressing two of the most common customized products in the apparel segment: indiDenim provides custom jeans for women and men, and indiTailored custom dress shirts for men. All apparel is made using Archteype's proprietary fit technology. Both customization offers went live during the last week.

Configurator and co-design process

Both the jeans and the shirt offering are based on a good, state-of-the art configurator. However, nothing new and noteworthy here, both toolkits are designed to make their job simple and with less complexity for the consumer. What differentiates the two offerings from their competition is the scope of customization offerings, and, hopefully, the better fit due to Archetype's long experience in the field.

Shirts begin at an affordable $79, custom jeans are starting at $130, so the price point of mass customization is truly met. What I liked is the strong focus on customer satisfaction: indi guarantees each and every order. Customers not completely satisfied can return garments for a full refund.

Denims are produced in a dedicated high-tech factory in Mexico, and shirts in Honduras.

Closing the learning cycle of mass customization

The company also offers an innovative reorder option that allows a customer of shirt to refine the fit of their garment by making adjustments to the neck, sleeve, arm, cuff and body length. These adjustments are used to alter the customer’s unique pattern which indiTailored keeps on file, so the customer can always find a new customized fit in more fabrics and styles (the selection of fabrics for the shirts is very limited in the moment):

 "One thing that is quite innovative about our technology is the ability for a customer to make fit adjustments to a garment that they have received.", CEO Marybeth Luber explains. "We recognize that fit is a very personal thing and sometimes we do not nail it on the first attempt.  Our “re-order” process allows a customer to tweak the fit of their pattern – say take the waist in an inch or lengthen the inseam.

 We, then, make the garment and store that pattern on the customer’s file for future orders.  With indi Wholesale, we are looking to partner with boutiques to carry standard size indi garments while also offering the custom ordering process.  So many people try things on and wish they could change one or two things about the garment.  This model enables this. "

 This is an old, but very powerful idea of mass customization finally in place!

 indi CEO Marybeth Luber on what's coming next

 I met indi CEO Marybeth Luber on the MCPC 2007 conference where she already mentioned the start-up. She is a former banker turned apparel executive, and joined Archetype Solutions in 2004 and took the helm in 2007. She has since been steering the company toward its vision of introducing a portfolio of brands leveraging the company’s custom technology.

 In an e-mail conversation, I asked her what's next to expect from Archetype and indi. She told me that the company intends to expand the portfolio of products available for customers. Next for indiTailored will be a fashion style with more contemporary fabrics and expanded customization options. And there will be even more, as Marybeth explains.

 "Next up for us is a low rise jean for men to add to the men’s Potrero Classic and Relaxed fits we currently offer.  We have design-your-own denim jackets in the works for women where women will get to choose details such as pockets, finishing, embroidery and screen-printing. Additionally, we absolutely need to expand our size range to cover Plus and Big&Tall.  This is important to us, because we want to offer garments for all consumers.  These sizes require different fit blocks so it is also in the pipeline of future product rollout."

One further idea will be a wholesale business for indi that the company considers to be quite compelling for bringing mass customization for apparel to retail (http://www.indidenim.com/wholesale/).

The wholesale program enables a retail partner to choose the fabrics, styles and sizes that are best suited for their store's clientele. And if customers still can't find what they're looking for, retailers can place custom orders for them. What I found very innovative is the option for retailers to create their own designs, choosing from the hundreds of custom style options. This utilizes the customization options of indi even further, offering retailers the opportunity to create their own assortment.

 Marybeth Luber: "Of course, our B2B business [with Archtetype] continues to be very important to us.  We have positioned indi in a slightly more premium space and offer an expanded selection of styles and options with higher price points so we are not in direct competition with our B2B business.  Many consumers still do not know the option for affordable custom clothing exists so we think anything we do to further develop this market is good for all of us.  We also hope to pursue the B2B model with indi by partnering with 3rd party distribution channels.  We currently have one such partnership in the works."

 I also asked here how indi relates to Zafu. Are there any connections internally between Zafu und indiDenim?

 "We spun off the zafu business last year," Marybeth Luber told me, "and the two companies now run autonomously.  We do, however, have indi jeans featured on zafu, and indi is definitely a good option for zafu users when zafu is unable to recommend many brands that are available in the marketplace."

 Cooperation between indiDemin and Intellifit  

indiDenim also will cooperate with Intellifit to gather body measurements in a high-tech store environment. Tests are in its way in the moment.

Intellifit currently markets a patented 3D full body scanner that accurately takes over 200 body measurements of a fully clothed person in under 15 seconds (see my earlier posting). At a Custom Jeans Center, the customer enters a see-through Intellifit Virtual Fitting Room measuring 8 feet high and 7 feet wide.  Low-power radio waves collect numerous, accurate body measurements of the customer over a period of 20 seconds. Customers don't have to undress for this technology.

The customer then designs their pair of jeans online at the indiDenim site, choosing from a selection of styles and washes, and specifying details such as pocket shape and design, stitching and personalization options. 

 The two initial centers are located at each company’s respective locations, just outside of Philadelphia and San Francisco.  Using Intellifit’s and indi’s technologies, the centers enable consumers to design their own custom-made jeans in-person with a guarantee of a precise fit.

The marketplace

In a study by consumer research group Mintel, quoted in a press release by archetype, the overwhelming demand for custom jeans is confirmed. The 2007 jeans market reached $16.7 billion, a 5.4% growth over the previous year. Prior to that, in 2006, the jeans market experienced a 7.9% growth. This wardrobe staple is often the most challenging clothing item to find, and fit remains the primary concern for jeans buyers. In the Mintel study, more than half of respondents (56%) reported “it is very difficult to find a pair that fits properly,” while a third of jeans buyers (33%) said that “sizes vary too much.”

indiDenim’s customization eliminates the fit issue, as each jean is custom tailored to each customer’s size and shape. indiDenim’s innovative technology enables size and style combinations that would otherwise require millions of SKUs and be impossible for a traditional retailer to offer, Marybeth explains. "Our ability to customize the fit while offering extensive style variations such as fabric, rise and leg style cannot be replicated by a traditional retailer given constraints on inventory that typically limit the style and size selection.  Previously, consumers could spend days shopping for their perfect pair of jeans, which they can now create in minutes at a Custom Jeans Center."  Or today on the internet.

Guest Article: Mass customization of musical instruments (in German language)

It has been a long time that I posted to this blog more than an event announcement – life as a German university professor keeps you really busy during the semester. But to keep up postings running, I got help from some members of our mass customization community.

In a first guest article, Jan Palkoska comments on a field not covered n the previous discussion of mass customization: the customization of musical instruments. Jan wrote his master's thesis on this topic, focusing on the customization process of drums. As he finds, customization is the predominant pattern in this industry, but the execution of mass customization principles is often just at the beginning. Often, craft customization dominates. Reading his thesis, I was reminded at the bicycle industry, where also many mid- and high-end bikes are being customized in form of craft customization in retail.

His article is in German language, but you may let Google translate the text, or just jump to the end of the text where you will find a number of examples for offerings of custom drums in English.

For more information, contact Jan Palkoska at janpalkoska@gmx.de

Vermarktung individualisierter Musikinstrumente – Ein Vergleich verschiedener Angebote in der Schlagzeugindustrie. Von Jan Palkoska.

Musikinstrumente erscheinen auf den ersten Blick relativ ungeeignet für Individualisierungsbemühungen: So kommen Umsetzungen individueller Vorstellungen bei Instrumenten einer klassischen Orchesterbesetzung schon von daher kaum vor, da sich in den meisten Fällen – etwa Streich- oder Blasinstrumenten – eine traditionelle Bauform zugunsten eines optimalen Klangerlebnisses bewährt und allgemein durchgesetzt hat. Durchaus denkbar sind persönliche Anpassungen oder Einstellungen in Einzelfällen; diese betreffen aber nicht die grundsätzliche Konstruktion, und auch ästhetische Veränderungen, obwohl dies durchaus denkbar wäre, sind insgesamt unüblich – abgesehen von wirtschaftlich nicht nennenswerten Zuwendungen, die dem Einzelkünstler den Acrylglasflügel nicht entbehren lassen.

Außerhalb des klassischen Bereichs hält die instrumentelle Welt aber durchaus zahlreiche Vertreter vor, welche zur Umsetzung persönlicher Wünsche geradezu einladen, vor allem nämlich diejenigen, welche der Konfiguration bedürfen und je nach Bauweise einen höchst individuellen Klang und extravagante Erscheinungsbilder zu lassen: zum Beispiel Schlagzeuge.

Drummers of today are spoiled by the plethora of custom made drums (nearly equaling the number of production drums).

Wie dieses Zitat von Falzerano (1994) aus dem Jahre 1994 zeigt, haben die Hersteller von Schlagzeugen recht früh die Vorteile kundenindividueller Produkte erkannt und sie entsprechend vermarktet.

Auf der NAMM Show 2008, der Messe für Musikinstrumente in den USA, waren von einundvierzig Schlagzeug-Ausstellern lediglich siebzehn als reine Serienfertiger zu bewerten; während die Präsenz existierender Serienhersteller auf der Messe nahezu komplett war, ist davon auszugehen, dass die vertretenen Customizer im Vergleich zu weiteren Customizern die deutlich kleinere Gruppe war: bereits im Internet sind weitere achtzig bis neunzig Unternehmen vertreten.

Zwar sind die meisten dieser Firmen kleine Handwerksbetriebe, doch auch sie vermarkten ihre Produkte global und genießen unter Musikern ein hohes Ansehen. Trotz kleinerer Firmenstrukturen bedienen sich diese Hersteller zunehmend typischer Mass Customization Tools, allen voran Konfiguratoren. Dadurch wird auch die Einteilung in kleine Handwerksbetriebe oder größere Mass Customizer mehr und mehr obsolet, wobei selbst die Mitarbeiterzahl und die Ausbringungsmenge nicht unbedingt aussagekräftig sind.

Tatsache ist, dass Customizing in der Schlagzeugindustrie zum Schlüsselbegriff geworden ist. Der von vielen Firmen erhoffte Differenzierungsvorteil durch kundenindividuelle Produkte ist dementsprechend vor allem hinsichtlich der Vermarktung fraglich, da die große Mehrheit aller Anbieter kundenindividuelle Produkte im Leistungsprogramm führt, ständig neue, wenn auch kleine, Customizing-Betriebe entstehen und nicht zuletzt auch der Begriff Customizing inflationär und nicht immer im zutreffenden Sinne zu Vermarktungszwecken verwendet wird.

Eine Marke soll mit den sich verändernden Ansprüchen des Nutzers wachsen können, weshalb eine Anpassungsmöglichkeit des Instruments unbedingt erfordert. Um, trotz der weiten Verbreitung dieser Mechanismen, durch Customizing dennoch ihre Marken abgrenzen zu können und nicht gerade durch vermeintliche Individualität zum gesichtslosen Produkt zu werden, platzieren sich Firmen in der Schlagzeugbranche heute durch den Grad der Individualisierung. Dieser ergibt sich aus den jeweiligen Kompetenzen und Möglichkeiten, so dass die Konstituierung einer Markenidentität zunehmend durch die Vermarktung intangibler Leistungshorizonte angestrebt wird.

Während also beispielsweise das kalifornische Unternehmen Orange County Drum & Percussion die außergewöhnlichsten Designwünsche der Kunden zu ermöglichen versucht, bietet der japanische Hersteller Pearl die Umsetzung kundenindividueller Klangcharakteristika durch unterschiedliche Trommelkesselkompositionen an. Andere Firmen wiederum spezialisieren sich durch die Verwendung unkonventioneller Grundmaterialien  – wie es bei RCI Starlite der Fall ist (Acryl), nach stilistischen Orientierungen – etwa bei San Francisco Drum Co. (Vintage Fokus), oder gar durch „special effects“ – von tmd customs (illuminierte Instrumente).

Auch die Art des Kundenservices unterscheidet sich teilweise massiv. Während bei einigen Herstellern Produktkonfiguratoren Verwendung finden, ermöglicht Phattie Drums dem Kunden den persönlichen Kontakt zu den einzelnen Handwerken. So können sogar hochspezielle, oft nur schwer verbalisierbare Wünsche gemeinsam umgesetzt werden. Entsprechend siedeln sich solche Produkte preislich im High End Bereich an und stellen somit eigentlich keine realistische Konkurrenz zu Herstellern von Serienprodukten dar.

Eine innovative Option bietet das traditionsreiche deutsche Unternehmen Sonor, welches ein Mass Customization Konzept geschaffen hat, bei dem der Kunde sowohl die Vorteile der Serienproduktion, als auch gleichzeitig Optionen des Customizings nutzen kann. Vorkonfigurierten Serienprodukte können durch Möglichkeiten des Customizing Konzepts SQ² individuell ergänzt werden und tragen so dem „share of wallet“-Gedanken Rechnung. Dabei sind auch vollständig individuell zusammengestellte Drum-kits innerhalb gegebener Möglichkeiten denkbar, wobei ein positiver Kosteneffekt vor allem durch die Synergie von Serien- und individuellen Produkten entsteht.

A selection of mass customization offerings in the drum industry

dw drums (www.dwdrums.com):  At DW, we're famous for building custom kits. Exotic woods from around the globe, sonically diverse shell configurations, hot-rodded Graphics lacquer finishes, four distinct drum hardware color choices and so much more. It's all about expressing your own personal style behind the kit and on it. (Customizing since 1990)

Orange County Drum & Percussion (www.ocdrum.com):  One of the things that makes OCDP different from other companies is the options and the finishes. […]This does nothing for the sound of the drum, but it gives the drum a more custom look which some people prefer. (1991)

Pearl (www.pearldrums.com): Masterworks is about choices for the discriminating drummer. Choices like North American Maple, Scandinavian Birch and African Mahogany. Three highly prized woods for shell composition, not just the same shell everyone else custom paints. […] With Masterworks, your kit sounds like your kit. (2003).

Phattie Drums (www.phattiedrums.com): Beyond Custom [...] Now you can work with a member of our staff to design your own Sounds Like Art snare. Our wood experts will help pick a wood that meets your sonic requirements while our artists turn your ideas into 3D designs carved into the shell. You also have the option of custom hardware, working with our artists to create a lug that compliments your shell design while maintaining functionality. (2001).

Pork Pie Drums www.porkpiedrums.com: Whether recorded or live, the difference in your sound will be a custom Pork Pie™ Snare. Hearing is believing! Our Snare Drums are available in an almost limitless choice of Custom Lacquers, Stains and Wraps. (1987)

RCI Starlite www.rcidrums.com: All of our RCI acrylic shells are made from a specialty formulated hardened performance polymer made in the USA exclusively for RCI. These are true All American manufactured products made in America by Americans. [...] It’s impossible to list all the infinite patterns and color combinations that we create due to the fact we are a total custom shop. Whether you are a top manufacturer in the industry, a boutique drum manufacturer or an individual looking to create your dream set RCI deals directly with a personalized service.

San Francisco Drum Co. www.sfdrumco.com: At San Francisco Drum Co, we believe in combining the classic design approach from yesteryear with today's modern materials, construction methods, and components. (2004)

SHINE Custom Drums & Percussion www.shinedrums.com: What makes a custom drum company successful in the very crowded "custom drums business" these days? We believe the answer to this question is quite simple...offer a product that is reliable, better built than your competitors and give artists and customers the kind of treatment you would give to your family or close friends. It seems like a simple concept yet it is why Shine Drums is the fastest growing and most sought after custom drum manufacturer in the world today. (2004)

SJC custom drums www.sjcdrums.com: Design your dream. (2000)

SONOR (www.sonor.com): SQ2 is more than a new drum series. It is an entirely new concept both of making drums and selecting drums. With an almost unlimited variety of shell - size - finish combinations SQ2 is the most individual drum we have ever made and the most unique one you have ever dreamed of playing. It will let you speak with your personal musical voice. It is your signature in sound. (1993)

tmdcustoms www.tmdcustomdrums.com: Ceelite is a new technology that allows flat, flexible light to be formed around the shell of any drum and is available through TMD Customs. This will bring a new dimension to what was thought to be a stale market. With every company offering custom designs, TMD Customs brings you the new wave in drum finishing that you will not be able to find anywhere else. Ceelite allows you to illuminate your entire drumkit with the touch of a button or by simply hitting the drum by using the optional trigger mount creating the first ever lit drum show. (2005)

Zapfab: User-generated content meets 3D Printing

A new Ponoko-alike company is coming from Manchester in the UK! Zapfab Ltd is a user manufacturing start up that offers a new way of delivering individualized, customized products. As other companies in this field, they are combining the creativity of user-generated content with the power of 3D Printing (fabbing).

In a press release I got today, the company is described as follows:

"User-generated content is ubiquitous throughout the internet, from weblogs to YouTube videos. Zapfab builds on this trend, by providing a website where users can easily generate unique designs for 3D objects.

3D Printing is rapidly gaining ground as a way of creating real, physical objects from 3D design data. Zapfab provides an easy way to access this technology: Once you have generated a 3D design you can choose to have it 3D printed: Zapfab will 3D print the design and deliver the finished object to you.

The Zapfab website has two main areas: the Design Catalog and the 3D Customizer. The Design Catalog contains all the designs on the site and is a repository like Google's 3D warehouse. The 3D Customizer is where the customizing takes place: Each design can be customized in different ways: color, size, pattern, etc. and the 3D Customizer contains simple controls for each of the options. So, once a user has customized a design, she can save it back into the catalog for other people to see. And then they in turn can customize and build on her design.

“We see three main groups of users for Zapfab.com,” said Julie Wood, Zapfab Director, in the press release “First, we have made the 3D Customizer really easy to use, so that anyone can create a unique, customized design in just a few minutes.

Second, there are a range of users with 3D modelling skills, who will be able to upload their designs to the site; and we aim to make it easy for them to add customizations to those designs.

Third, users with programming or scripting skill will be able to create new, highly-customizable designs. And all the designs, from the simplest to the most complex, are customizable through the same easy-to-use 3D Customizer.”

At the moment, Zapfab’s Design Catalog contains over 100 customized designs, ranging from bowls to boxes and bangles. All of the designs can be 3D printed “as is”, or freely customized. It is a nice, but at this stage not too creative collection of things. But I hope to see much more activity on their side, and given that they are located in Europe, I also will try this service by myself in the next weeks and let you know about my experiences.

Research Project Presents Custom-Fit Motorbike Helmet

A recent survey revealed that many motorcyclists have problems in finding a perfect fitting helmet. Mass production cannot solve this issue. Today, partial personalization is done by offering the consumer the choice between with different paddings. But a new manufacturing philosophy is needed to produce a fully customised helmet, perfectly formed to the geometrical features (=head) of a user.

Research from the Custom-fit Project, funded by 6th framework program of the EU, offers a solution: fully personalised helmets at a cost effective rate. The starting point is the 3D scanning of the rider’s head shape, using a laser scanner developed by Custom fit partner Human Solutions. The scanned surface model represents the reference point from where adaptations are made on a standard design, resulting in a helmet design, perfectly shaped to the rider's head (carried out with a specialised CAD tool from the project partner Delcam).

Finally the customised part of the helmet, the liner, is manufactured using a new Rapid Manufacturing machine (a Power Printing Process tool developed in the project by DeMonfort University) which builds the product layer by layer with a high productivity by sintering polymeric powders specifically selected for the new process.

The main issue with custom helmet is safety. While the custom production offer large advances with regard to comfort due to better fit, the safety prepositions of a laser sintered product are still open. To improve this factor, the customised helmets use the same amount of expanded polistyrene that is used in standard and certified helmets (this material is principally responsible for the function of shock absorption). Moreover, some special customisation of the mechanical characteristics of the customised liner should increase safety level, for example lowering the tendency of the helmet to be pulled off the head during riding.

The project has also dealt with the reorganization of service and delivery, by studying a new way to interact with customers form the moment they start the order process, where the head needs to be 'scanned', to the point in which the customised helmet is delivered. All modification to the supply chain have been studied. Initially the rider/customer will probably face an increase in price and delivery time to have a Custom Fit helmet. Nevertheless they will be rewarded by being the owner of a unique, custom-made helmet, not only more comfortable but safer as well.

Context: Custom-Fit is an industry led project to investigate the possibility of moving towards knowledge based manufacturing and customised production through integration of knowledge in Rapid Manufacturing, Information Technology and Material Science. I am serving as a scientific adviser of the project. Funded under the Sixth Framework Programme, the project involves 30 partners from around Europe. The aim is to create a fully integrated system for the design, production and supply of individualised products. It has targeted product for implementing the new technology, including motorcycle seats, helmets, implants and prosthesis.

Top 10 Mass Customization Companies in 2007 -- Report in Best Practice Business Blog

Happy New Year!

Best Practice Business is a rather large German blog, and Burkhard Schneider, its main author, recently added more and more good reports on new mass customization companies. If you understand German, very worthwhile to read.

Yesterday, as part of the usual top 10 lists popping up at the end of the year, he also created a list of "top 10" mass customization companies in 2007. There are a number of great concepts, others I find less innovative, other are missing, but it is a great review of interesting concepts in the area. The blog, and the posting, are in German, but you easily will get the picture. Here is the top-10 list (go here for further descriptions and the links)

# Mymuesli: Mass Customized Müsli
# Blends For Friends: Mass Customized Teas
# Vuru – Custom nutrition
# My Twinn - custom dolls
# Miss-Information: Custom travel books
# flattenme: Personalized children books
# TasteBook: Mass Customized recepies
# Paragon Lake: mass customized jewelry
# Cosmocards - Personal Greeting Cards
# Zyrra – mass customized bras

MC Configurator Database Went Live - Great New Portal Provides Comprehensive Overview of Mass Customization Offerings

Additional Site Feature: MCPC 2007 video interviews with Joe Pine, Stan Davis, Mitchell Tseng and many other ...

The unpublic beta was one of the best kept secrets in the mass customization world of the last months --- now it is public: The huge database of configurators (co-design toolkits) compiled by Paul Blazek and Wolfgang Frühwirt and their team at Cyledge.com, a Vienna based consultancy in the field of configurators.

What is a configurator? Well, "simply put, a configurator is a software application for designing products exactly matching customers' individual needs", the site says. As they further explain, configurators can be found in various forms and different industries. They are employed in B2B as well as B2C markets and are operated either by trained staff or customers themselves. Whereas B2B configurators are primarily used to support sales and lift production efficiency, B2C configurators are often employed as design tools that allow customers to "co-design" their own products.

What Paul and Wolfgang do not is to document configurator software providers, but real configurators on the web ... more than 500 of them. All arranged in a nice database sorted by more than 85 criteria, including

- Steps to starting (distance to the configurator, number of web pages the user has to go through in order to get to the configurator (distance from the Homepage)

- Process navigation

- Module library (pre-customized products are available for further customization)

- Automatic completion (The configuration process can be continued even if the user ignores a required decision during the configuration process. The system completes the product automatically, meaning that the user doesn’t need to edit every step in order to continue the process)

- Loading Time (under 15 Seconds)

- 3D-perspective exists allowing the user to rotate the product picture 360°. (yes/no)

- Delivery time

- Weaknesses of the site as seen by the evaluator.

Well, for the public version they just reveal about ten criteria, but this already provides plenty of benefit. You get a great overview of what is available in the world of mass customization: Did you know that there are six custom offerings for pets, 15 for children stuff, 37 configurators in the construction and building industries? Their rubric "most exotic configurators" list Sonor GmbH & Co. KG (custom drums), our friends from Elite Vintners (custom wine), Alois Reich (custom dirndl), Brewtopia (custom coasters), Tiny Pocket People (custom pocket dolls), or A.H.Beard Pty Ltd. (custom beds for children).

And there is much more, over 50 pages of listings ().

On top, the site has a nice blog (with some re-postings from my blog), a conference database, and a great library of short videos with key persons in the mass customization world. See my interview with a spectacular multimedia trick :-), or here wiser voices like Joe Pine, Mitchell Tseng, or Stan Davis himself ... the person who has coined the term mass customization:

Most of the videos were taken at the MCPC 2007 Conference. For many more videos go to the configurator-database.com site.

Full disclosure: I am a scientific advisor of this project and the sponsoring company, cyledge.com.

Personalization in Retail: How RFID tags are helping a German retailer to provide customization of the retail experience

Roland Piquepaille wrote in a ZD-Net Blog about RFID tags that help you to choose your clothes at a German retailer close to my home.

This application fits perfectly to the discussion we had at the MCPC 2007 Business Seminar a month ago in Montreal on "A total makeover of retail". Here are some quotes from the posting:

"A German department store, the Galeria Kaufhof in Essen, part of the Metro retailing group, is using RFID technology in a new way. … Men buying clothes in this store will get automatic suggestions. For example, when you go to a dressing room to try a suit, a ’smart mirror’ will tell you what kind of shirt or tie you need to buy with it. Will this technology be deployed elsewhere? Time will tell.

… An RFID reader on a “smart mirror” in the change room determines which clothing has been brought into the room from the RFID tag attached to the apparel, then displays complementary clothing choices or accessories. The system is used in combination with ’smart shelves,’ which can read what merchandise is currently in stock, so that customers can be shown choices in sizes that are available, and in various styles and colors.

… RFID readers are installed in walls, tables, and clothing racks of the men’s department. In addition to providing METRO with data on store floor inventory in real-time, the readers enable a number of consumer-facing applications that METRO hopes will both wow customers and make their buying experience richer and more convenient. The RFID tables are hooked up to an accompanying flat screen, which displays what sizes and styles are immediately available on that table. The RFID mirrors detect which garment the customer is wearing or holding and offer recommendations for complementary items.”

And of course, all this information is extremely valuable to the retail chain. Let’s return to the Baseline article for its conclusion. “Bill Colleran, chief executive of Seattle-based Impinj, says the exciting thing about the Kaufhof deployment is that it demonstrates that RFID can be used in retail for much more than to wring out cost savings in the supply chain. With the use of business intelligence systems like smart mirrors and smart shelves, it can be a new sales driver. ‘People joke that this is the ideal place to start because men need more help” in making choices,’ he says.”

Context information:
- The full blog posting of Roland Piquepaille.
- Report in Baseline Magazine which was the source of Roland's article
- Metro press announcement
- Press release by the technology providers

Udate: Crowdlogoing the New Spreadshirt Tagline: New Design Competition Launched -- and finalized

(Update of the original posting from Sept 2007 -- now with the project's final result at the end of this post!).

Hey, you designers of the world. Treat me nice: I am on the panel of the new Spreadshirt Open Logo competition :-). Coined the Open Logo Project (OLP) 1.6, this is the second time that the company has started a crowdsourcing contest for its new logo. Anyone can submit a draft logo for comment and evaluation by an expert panel, other designers and the Spreadshirt community. Each week during the contest, the top entries will win awards and a place in the overall grand final.

The last contest (hosted 1.6 years ago) received over 1000 submissions from more than 600 designers mainly in Germany and France. This time, the entire world shall participate. The contest will run from the 27th August - 14th October. To take part in the contest - with submissions, comments, voting or just lurking - head to http://olp.spreadshirt.net.

Every branding textbook, however, will tell you not to change your logo every two (or even 1.6) years. But “…this is not a publicity stunt," said Jana Eggers, Spreadshirt’s new CEO. "We found a tagline that better represents what we do, and now is the right time to change our current logo to support it".

The new tagline, resulting from working with an international branding firm: "Your own label" shall reflect Spreadshirt's mission to be "the world's creative apparel platform". After deciding on the new tagline, the natural step for Spreadshirt was to turn to its community again for a logo that better supports the new tagline.

The cool thing: Adam Fletcher, who is coordinating the competition at Spreadshirt, even allowed me to pick my own prize. So: I will award a first price for the most innovative design, one, that really demonstrates uniqueness and out of the box thinking. And this price will be truly innovative and unique as well: You can win an entire mass customized outfit. More on the website!

But beyond the innovative prices, also the OLP idea competition itself has some nice features which make it a great example of open innovation and sets it ahead to other design contests on the web:

They have ten different awards and prizes for different categories which also honor not only WHAT, but HOW you design, awarding good competition citizenship. There are prices for community involvement, memorability, branding excellence, etc …

This also allows Spreadshirt to think of those that offer input but can't design (I would be a perfect candidate for this). Anyone who actively contributes to the OLP community by ratings, commenting, offering feedback, starting discussions etc can win one of every shirt that Spreadshirt’s “La Fraise” prints for the next year (should be around 100 shirts – so if you win, buy a new closet).

"We [want] to recognize out-of-the-box thinking, collaboration, community favorites and more," adds Adam Fletcher. "Even if you're not the winning designer, you can scoop a number of other prizes, or just waste a lot of your time, learn a lot from looking at the work of the other designers."

For real winning designers, they also provide more than cash, but help with the most valuable good for artists, recognition. Along with a MacBook pro and €3,000 cash, the winner will be featured with a photo and an interview in he “Computer Arts” magazine, an interview on “Computerlove” and a permanent “thank-you-page” at Spreadshirt.com

So, now get your creative fluids working … and submit a nice logo so that I have something to judge next week !!

------------

UPDATE: The project is over -- and it was an interesting experience for me to be on the panel of such an open innovation competition. Here some observations:

First: The winner: While Spreadshirt selected two first prices for their new logo (see the designs here) and is now working with the community on improving the designs. My personal short list looked a bit different, see it here.

Second: My winner: As written above, I could award my very special price for the most innovative design. My clear favorite was Labelhead, not just a logo but an entire logo configurator. Here is my long description why this is the most innovative (and in any case customizable) logo! (and this posting also gives you a rare view of my living room :-)

Third: Participants of an open innovation project get engaged and personal: The entire competition drew more than 2800 entires, generated millions of hits and views, a lot of postings and good press for Spreadshirt -- and did not cost really too much compared to the cost of getting a professional new logo (and PR campaign) from a regular agency (cost were about 10 K Euro for prices, Adam Fletcher's salary of running the contest, and some web site programming etc ..). The best insight into the enthusiasm and engagement of the participants can be found in the comments to the posts, just browse through some of the winning designs or see the comment on the selection of the winners (example).

For me, it was was interesting to read what people really thought about my selections (more comments here). I think I really do not look like a designer or pretend to know much about graphic design -- my task was to provide a business and customization perspective for the panel. But participants expected my real feedback on their designs ... learning_ pick panelists that really know what they are writing about.

Fourth: I learned a lot about customized toilets :) See comments in the middle of this stream.

User Innovation in the Catholic Church: Dioceses of Cologne launches idea competition platform

This is the last sign that there is something behind user & open innovation: The Catholic Church has started an online open innovation idea competition (well, one could say that the entire church IS a lead user invention anyway).

KJG, the Catholic youth organization of Cologne, one of Germany’s largest dioceses, just launched a web site where young people are encouraged to submit ideas what they want to change at the Catholic Church.

The website aenderwas.de (German for „Make a change“) broadly asks for ideas and suggestions. You can either submit a short idea or comment, or upload a long suggestion (perhaps for a real innovative interior design of a Church that you would like to see; or the tunes of a song you would like to sing …). Interestingly, they also ask one of the easiest but often neglected questions: If you don’t go to church, why?

People who submit the best and most innovative ideas will be invited to a kind of lead user workshop to build on these ideas and to transfer them into more concrete offerings. But the people behind the initiative also know about the limits of this approach and acknowledge in a disclaimer that not all change requests can be incorporated immediately.

It all started, by the way, when one of the organizers was in an Executive MBA class I taught on open innovation a while ago. She immediately saw the opportunities of improving the offerings directed towards younger people by the Church, and later transferred her learning into this project.

I am very curious to see what comes out of this initiative and what will be the experiences of this project. Will such a broad call for input generate real innovative ideas? I will keep you posted – and if you have an idea what to change with the Catholic Church (from the perspective of you, the user), the opportunity is there: www.aenderwas.de (note: While God speaks all languages, you need German language skills for this).

Bikers Want Customized Motorcycle Seats, Custom Fit Study Finds

Motorcyclists are in favor of customizing their motorcycle seats according to their body geometry. A survey on customization of motorcycle seats carried out as part of the European funded project Custom-Fit, found that 81% of the survey respondents support the idea of a customized seat.

The Custom-Fit project is investigating new techniques for customizing a product based on Rapid Manufacturing (RM). The project is supported with almost 10 millions Euro by the European Community and is one of the largest projects in the area of customization (Disclosure: I am a member of the project’s scientific advisory board).

As explained in the previous posting, RM allows parts to be manufactured directly and automatically using 3D computer-aided design (CAD) model. The new technique will enable consumers to buy products that are built to the exact requirements of the consumers. A motorcycle customized according to body geometry is one of the products which the project is investigating. Other possible applications of the new technique include prosthetic sockets, helmets, mandible implants and knee implants.

The survey was recently carried out by Loughborough University in UK, who is a partner in the project, and received 3200 responses from motorcyclists worldwide. In the survey, majority of the respondents owned a motorcycle and do not share their motorcycle with another person. Although only half of the respondents said that they had experience of discomfort from their motorcycle seats, but majority felt the discomfort during long distance travelling. In addition, more than half of the respondents are willing to pay a premium for the customized seat and many were willing to wait longer.

Professor Richard Hague, Head of the Rapid Manufacturing Research Group in Loughborough University, said: “These initial results show that there is wide support for customised goods – even if initially they are more expensive and take longer to produce.” (Note: Richard Hague chairs the Rapid Manufacturing Track at the MCPC 2007 conference!)

The next phase in the project will be to investigate the technical practicality of designing a motorcycle seat based on the scan data of the consumer’s body profile. Research on how to obtain the body geometry has already started and the project is is now working on defining a “comfort map”, which is a combination of the pressure map and the discomfort zones.

This result is used to identify the area on the seat which needs to be redesigned and the new seats will be testes on motorcycles. At the same time, the management issues involved in providing a customization service for motorcycle seats have also been studied. The project has identified the possible ways to offer the service to the consumers and is studying the supply chain implications of introducing such a service.

Context:

- More results from the Custom Fit project will be presented in several talks on the MCPC 2007 @ MIT !

- Custom-Fit is an industry led project to investigate the possibility of moving towards knowledge based manufacturing and customized production through integration of knowledge in Rapid Manufacturing, Information Technology and Material Science. Funded under the Sixth Framework Program, the project involves 33 partners from around Europe. The aim is to create a fully integrated system for the design, production and supply of individualized products. It has targeted product for implementing the new technology, including motorcycle seats, helmets, implants and prosthesis. Project homepage: http://www.custom-fit.org/

Puma BBQ for Millionaires: Puma cooperates with Italian luxury brand Schedoni to offer special collection of customized shoes

Earlier this week, I was in London for a workshop. As I had some time to spare, I browsed through Harrods which was just opposite my hotel. In te store, I found at least ten different customization offerings, including custom gold clubs and a “mi adidas” sales unit. But in the men’s shoe department (not in the Sports department!), I discovered a new Puma mass customization offering which was already launched in April of this year, but apparently is so exclusive that I did not discover it before.

To upscale its BBQ offerings, Puma cooperated with Italian luggage maker Schedoni, one of the top Italian luxury brands. The company has a special line of luggage for your new Ferrari, or offers bullet-proof briefcases used by the Italian secret service, and, since a few years, also hand crafted shoes (shoe manufacturing was the original core of the company).

To supplement your Ferrari (or Volkswagen) experience, Schedoni is now teaming up with Puma to offer a line of driving shoes that can be customized with regard to color. In London, I now saw this system in operation. Fitting to the craft nature of the product, the configurator is a low-tech high-touch system. In London, I could play around with the shoe building "Puzzle Kit" which allows you to choose from a wide variety of leather colors for both the outer leather, and a contrasting leather color that shoes through the familiar PUMA logo in the side of the shoe.

The Motortrend blog knows that “no more than 500 of each combination will be made, and each numbered and personalized.” But for 350 British pounds a pair (almost 700 USD), I personally found this a bit to expensive for a pair of high-end sneakers.

Like with the Puma BBQ system, the Puma-Schedoni configurator will rotate in 50 Puma stores worldwide and will be introduced in selected high-end department stores. The production process will take about 4-6 weeks, and will be performed in the Modena factory of Schedoni. Shoes will be shipped to the customers’ home afterwards.

While the press and blog reports that I found about this system all claimed this great combination, the actual display at Harrods was a bit disappointing. Indeed, they had this great leather traveling trunks shown in the picture left (all pictures from PUMA via Pumatalk.com) but sample shoes (in the boxes left and right) and leather patches were unorganized and looked used – and this even in the high-end atmosphere of the Harrods footwear department. This is a typical other example of using mass customization as a brand building exercise. Such a system does not really demand much effort in introduction, but has large press appeal and underlines the fashion appeal of Puma.

What the benefit for Schedoni is, I am not sure. They could have made this as a profitable stand-alone business with much higher margins, I believe, and perhaps a better positioning in the market.

Context:

More pictures and reports in Motortrend and Pumatalk
And my previous posts on customized sneakers.

BMW’s Mini Brand Launches Custom Roof Designer Online

Evaluation of the new roof design toolkit and some ideas for improvements and additions

Driving a BMW-Mini often is seen as the ultimate expression of individualism. People paying the extra premium for a small, but fun car often select a Mini to express their individual lifestyle and to set themselves ahead from the crowd. For me, this always seemed to be a bit a contradiction, as I have seen very few really “cool” people driving a Mini, and at least in Germany, Mini drivers seem to follow a general pattern of belonging to a conservative upper middle-class medium aged segment living in larger cities. (I have, however, to admit that driving a Mini really is fun and a very nice experience).

Also, from a mass customization point of view, a Mini has rather limited customization offerings. While the configurator suggests plenty of choice options, they are rather limited, especially with regard to style customization like color combinations between body, roof, and interior. All choices seem to be perfectly balanced to deliver neatly tuned combinations fitting the Mini brand image as seen by its corporate parents.

But now, there is ultimate choice. Customers now can freely design the Mini’s roof with their very own design. The roof is one of the signature design features of the Mini. It is often selected in a different color than the body. And now you not only can select from 15 or so standard colors, but really design your own, as the German weekly Der Spiegel reports in its online edition.

Enter the Mini Roof Designer, a very well done playful online design toolkit that allows you to generate your own roof design. The configurator is full of nice gimmicks providing a great experience, but not really helping you to come up with a better design. As far as I could evaluate this configuration toolkit, this – in the moment – is a pure marketing gimmick. You can design your roof and save it, but that’s it.

According to the regularly well informed Der Spiegel, however, you also can order very soon your individual design in form a custom-made foil with your individual pattern that your Mini dealer will fix on your roof. (and in the Carscoop blog I read that the orders are available only in Italy for the time being, Germany will follow in June, Austria in the third quarter, with further countries being added later).

Given the high prices for extras for the Mini, 400 Euros for this service seem to be not too expensive. I bet there even will be fans ordering their custom roof stickers without even owning a Mini. And I am looking forward to see all the really custom designs printed on Mini cars and how they match the look of their owners. Have a look in the gallery of the Roof Configurator to see what I mean.

Nice idea. Some thoughts I had while playing around with the configurator how to improve this offering :

(1) It will be interesting to see if and how Mini approves all designs and whether there will be limits of what people can print. For the online gallery publicly showing your saved design, a manual approval process takes place. After I saved my Mini, the system told me that it will take ONE WEEK to approve my design before it is online. Hey, we are in an online, real-time, instant gratification world and the automotive industry is talking about the Three-Day-Car http://www.3daycar.com/!!

(2) It is rather difficult to come up with a nice design. The system offers many tools, but as an average user without design skills, it is difficult to come up with something creative. Easy-to-modify starting designs are missing. Also, I would have loved to get some more inspirations, perhaps by famous designers sharing their own Mini roof. And if I would be a professional designer, I would love to be able to upload a design made in Photoshop or any other professional design program using a template provided by BMW.

(3) The custom Mini roof sounds like a perfect idea for a new Threadless clone . Let the best in the world design roofs in form of an open (ongoing) competition, and let the community of Mini fans and owners evaluate the designs and vote on the winners. Then produce these designs in limited editions and sell them within days.

(4) Or a modification of the Spreadshirt idea: Let users design roofs, and sell their individual designs to others. Designs are then individually printed, and designers get a share of the proceeds. Perhaps this also is a great after-sales tuning idea. Think of transferring the BEMZ idea of tuning IKEA sofas onto Mini roofs: Create custom Mini roof covers and sell them independently for 200 Euros. Given that about 1 Mio. New Minis have been sold, this sounds like a nice market opportunity.

So many opportunities for mass customization in the automotive industry. Let’s see what is happening next.

(Update) MyMuesli launched -- Create custom cereal online

(Update of posting from April 30). Whenever I am asked what the next big trend in customization is, one of my answers always is food. And one example that I am always referring to is custom cereal. While the cereal shelf space is pretty impressive in many supermarkets, there still is demand for more choice.

Consider food allergies in line with personal taste preferences, and add the wellness and functional food trend – as a result, you easily find many reasons why we want custom cereal. But to get custom cereal -- or any other custom food item -- we had to go the conventional way of craft customization, i.e. prepare our food from basic ingredients from the scratch.

Or select the artificial option: Nutrition supplements have been available in custom varieties since years. But now, one of my basic foot items can be conveniently mass customized, too: Muesli.

I just placed my order for a custom box of muesli. No raisins, but plenty of mango and apricots. No hazelnuts, but cashews and pine. And some magic Alfalfa (what ever this is, but is seems to be good). By doing so, I stepped into the typical MC consumer trap: Motivated by a cheap basic price and rather small additional premiums for additional items, I ended up with a Muesli that will cost about 4 times more per pound compared to my standard organic muesli mix. But it is custom, comes in a nice box, and has my name on it. So who cares?!

MC veterans will remember General Mills’ pilot in the same area, mycereal.com, but this venture never went online in full scale (a review of the old site is here).

Today, three business school graduates from Germany have launched Mymuesli (of course in beta). Max Wittrock, Hubertus Bessau and Philipp Kraiss offer customers on their rather simple site a simple, but working configurator to create complex custom mixes from more than 75 ingredients. While the site is not the latest in web design, I like the idea – and I am curious to see how the site develops!

Update: After about two weeks, I got my custom muesli mix. It was packed in a special tube box (which, however, did not survive the treatment in the German postal service). The muesli is great, really delicious mix, very good ingredients. But I am not sure yet f it is worth the high premium compared to my regular stuff.

And I am curious to see how the company follows up. In the end, custom food items are a perfect example for building loyal customers:
- Get your first order.
- Provide feedback if you like the customization (in my case, I would add more apricots, as they are so delicious).
- Send a reminder after the average consumption period for a reorder of the modified mix.
- If a customer reacts, this process will result in a subscription cycle of the custom good: I will never run out of muesli, and MyMuesli never will loose me as their customer. This a least is the theory.

After I posted about MyMuesli in the original posting here in this blog on April 30, several other reports on MyMuesli have been published. A good comment comes from Rad Tollett:

I think this web-based system of customizing the ingredients of food will have profound effects on major brands in the next twenty years. If the system is in place to customize cereal there is no reason why I, as a consumer, cannot go to a major soda manufacturer and ask for the same levels of control. The only thing preventing me is the fear inside the walls of major soda manufactuerers. The question they likely have but fear to ask is what would happen to Coke if it were opened? Would people choose the special sauce over making their own? Cane or corn? Heavy or light carbonation? More prune or less? Vanilla, cherry, orange, or what? What role does Coke play when I’m making “my” Coke? Scary, but freeing.

And trend-spotting Springwise knows that MyMuesli has had a great start -- and they have another great idea for using this toolkit:

Nice example of mass-customization, and one that's quickly catching on: Mymuesli started two weeks ago, but has already run out of packaging (which they'd estimated would last at least 8 weeks). ... One to adapt to local breakfast preferences? Could be a fun gimmick for hotels, too: during the booking process, let guests order their own breakfast and have it delivered to their room in a personalized box.

Context:
- In case you are able to understand German, you can read the founders' story in their blog.
- Stefan Jäger, a former Ph.D. student of my Munich group, wrote his thesis on mass customization of food. More information on his German book here.
- Here is an interview with the founders of MyMuesli.

Four New Mass Customization Start-Ups Presented by Business Week

In a recent article, Business Week presented a number of new start-ups selling custom products. The report by Eve Tahmincioglu provides some good insight into the costs and backgrounds behind opening a mass customization business. These are the customization businesses presented in the report:

CHIP-N-DOUGH is a local cookie company in Santa Ana, CA. It allows their customer to place corporate logos on the cookie tins. The response has been great: Last year, 30% of the company's $1 million in revenues came from the custom tins. Mrs. Snyder, the founder and owner, went through five programmers and $50,000 just to develop the software needed for customers to place online orders, and also designed the machine to print the custom tins by herself, including own chemicals and dyes which she customized to create proprietary colors. In total, she spent about $300,000 on the changes. Now customers can order between one and 1 million tins online. To date, the largest order has been for 15,000 tins—about 360,000 cookies. Customers can either upload images to the site and design the tins themselves or e-mail the images and leave the rest to Snyder's staff. Tins can be made in as little as one hour—less than the time it takes to whip up a batch of chocolate chip cookies.

ZYRRA was founded by Christi Andersen and Derek Ohly, in Cambridge, MA, to provide women with bras that really fit. The two business partners used $40,000 to modify off-the-shelf costume design software to create a large assortment of prototypes of different bras. On the sales side, Zyrra sells bras through home parties, in which one of the company's three salespeople takes 12 different measurements for each customer. Customers then choose colors and trim. Bras start at $70 and are manufactured in a local factory. The company’s web site is used for marketing and to ask potential customers for their ideas. Re-orders shall be possible online soon.

CHOICESHIRTS is one of the many businesses selling custom shirts. Founded by Matt Cohen in Pennsauken, NJ, it uses a fully automated process that keeps costs low and volume high. Cohen started his company with about $500,000 in personal savings in 2001. He sold stock designs at first, but quickly realized that offering custom designs could set him apart. Cohen upgraded the software on his Web site, working closely with an online development company in which he has an ownership stake. The process took about four months and cost several hundred thousand dollars, most of which went to developing interfaces that connect to back-end administrative and production systems. In 2002, he launched Mother's and Father's Day shirts that customers could personalize with their own or their parents' names.
Today, about 65% of ChoiceShirts' $3 million in revenues came from the custom shirts. And customers of personalized are coming back: About 20% to 30% of ChoiceShirts' business comes from repeat customers.

NAME MAKER is selling high-end gift wrap printed with custom slogans. When Cheryl Dorrell founded the company in 2004, she learned that the existing plotters could produce neither durable nor water-resistant prints. So she designed her own $250,000 machine. They now have five of the machines, and their workings are a closely held secret. Customers place their orders online, but the words are set by hand, part of a nine-step process that takes two weeks. Name Maker's made-to-order gift wrap runs from $24.95 to $32.95 a 12-foot roll. About 15% of Name Maker's $2 million in sales came from customized paper in 2005, and Dorrell expects the product to bring in as much as 65% of sales this year. Not bad for a new niche.

Mass Customization Enablers II: DemandMade & Exclusive Pro Create Partnership to Deliver a Complete Custom Apparel Solution for Online Retailers

Zazzle-Confego is not the only new partnership this spring. Also the second specialized mass customization enabler in the US, DemandMade , announced a new cooperation to provide a seaming less mass customization value chain by integrating product configuration with a domestic factory & fulfillment.

Hermitage, PA, based DemandMade provides technology and managed services for the complete mass customization value chain including consumer brands and retailers who wish to configure and offer personalized or mass customized products and factories who assemble made-to-order consumer products. The company was founded in 2005 by eBusiness veterans Scott Killian and Tim Brule, who pioneered eCommerce outsourcing when they launched FanBuzz in 1996 and the mass customization process CustomFan in 1999. One of the first online applications of mass customization, CustomFan was used to operate successful online merchandising programs for such brands as Coca-Cola, the National Hockey League, Peanuts, ESPN and the 2002 Olympic Games. The pair later sold FanBuzz to the television shopping network ShopNBC in 2002.

Last week, DemandMade has entered into a partnership with Rockford, IL, based Exclusive Pro, a provider of domestic apparel embellishment and fulfillment services specializing in retail programs using mass customization and personalization. Exclusive Pro's capabilities include full-service, single-piece tackle twill processes (twill, felt and leather), embroidery, heat transfer applications and private labeled fulfillment of single piece orders that are produced on-demand.

“We’ve combined a suite of Web-based tools specifically designed for apparel retailers with a domestic factory that is already using our platform to produce and fulfill single-piece orders,” said Scott Killian, DemandMade CEO, in a press announcement. “The result is a comprehensive solution for online retailers who want to launch a customized apparel or soft goods program.”

The combined offer uses an AJAX-based product configuration engine designed specifically for apparel items that online retailers can integrate with their existing online stores to offer personalized or custom apparel products. On the backend, the configurator is integrated with Exclusive Pro’s domestic production and fulfillment facility -- a complete solution that provides retailers with everything they need to launch a custom apparel program.

Terry Taylor, President of Exclusive Pro, says about his motivation to enter this partnership, “We have a long history of producing orders for single piece garments. However, the demand for our services has shifted dramatically in recent years to online retailers where the dynamic nature of these products can best be presented. This partnership with DemandMade effectively ensures continuity between the online experience and the production process.”

To see an example of the new product configurator, visit www.scenicstore.com/example

Pill Boxes 2.0: Vuru personalizes nutrition packaging

Sometimes it's all about the (re)packaging. As Springwise, a new Miami-based company called VURU sells nutritional supplements in personalized daily packs. Vuru is the brainchild of Grant Kornman, who says that his (heavy pill using) father inspired him to open this service, as Grant was fed up with selecting pills from many bottles to assemble the daily intake.

At Vuru, customers choose from over 2,000 name brand supplements and vitamins, select how many weeks worth they want to purchase and then have their personalized packs shipped to them. Each pack contains the daily dose into a slick little pack that fits 2-15 pills.

The idea: To spare customers the hassle of collecting pills from several bulky bottles into daily dosages. Vuru packs can be tossed into a handbag or pocket, and are perfect for travel. Each order comes with an information sheet, which has a picture of each pill, the supplement facts label, directions, warnings and any other information pertinent to that supplement or vitamin.

This is how the process works:

1 Name your pack: customers are asked to enter a name they would like to appear on their pack. This is an old personalization trick, that always works: Give something your own name, and you build commitment and involvement with this (standard) thing.

2 Fill your pack: From a long, long list, users now have to select their individual pills. In case you know exactly what you want, this is easy. In case you don't the site lacks a really important feature here: recommendation and advise. How should I know which nutrition supplement is best for me, what is the difference between the 15 kinds of vitamin C they offer, etc.

However: Besides creating their own unique blends, customers can pick one of Vuru's pre-selected mixes, varying from 'Woman's Yoga Pack' to 'The UrbanDaddy Pack'.

3 Choose the nubmer of packs to pick how many weeks supply you want and if you would like auto refills.

4 Checkout. Leave your credit card and money. Prices totally depend on the pills you choose.

Springwise comments on this idea:

"Several elements make this concept quite appealing. First of all, customers will love the ability to pick and mix their own, ultra-personalized blend from a wide variety of supplements. Secondly, there's the convenience angle: time-saving and life-hacking, Vuru is what our sister-site trendwatching.com would call a daily lubricant. One of those products that make people's lives just a little bit easier. Last but not least, the packaging is simple, shiny and chic. Which all combines to create a luxury 'health hack' that many consumers are willing to pay a premium for. The same concept could no doubt be applied to other industries. How about skin care products? Just be sure to think green and keep packaging to a minimum."

My comment: Nice idea and a good example how you can offer customization with standard products. This is just a nice packaging service, but one that may create customer value for heavy users of these products.

But: Sovital and other companies already go one important step further: They really customize the pill! and just produce a customized batch of nutritions just for you So that there is no need to take several pills (even if they come out of one nice bag) but just one that contains all the stuff your body needs.

The Consumer Decides: Nike Focuses Competitive Strategy on Customization and Creating Personal Consumer Experiences -- Data about the Nike Plus Personalization System

During its recent Investor Days, the Nike top management board announced a strong shift of its strategy from being a sportswear brand to becoming the enabler of customized, personal experiences. “Investor Days” are an extensive briefing for analysts; taking place only about every two years (the last was in June 2005). During its recent briefing at the company’s headquarters in Portland on Feb 6, 2007, the company placed a strong focus on its new global theme “The Consumer Decides” and revealed some interesting facts about its customization ambitions and ways to sustainable consumer experience.

During the meeting, also a number of interesting performance data of the Nike Plus system were provided, the Apple-Nike cooperation that allows runners to customize their running experience in a simple but very clever way. It is a strong contrast to the exploding variety Nike is facing today, offering more than 13,000 product different styles in every single quarter.

First, Nike CEO Mark Parker explained the theme “The Consumer Decides”:

“The Consumer Decides is one of Nike's 11 maxims that really define who we are and how we compete as a company. Today, consumers have never held as much power as they do today. They have more choices and more access to those choices. They connect and collaborate with each other over the world. … Clearly, the power has shifted to consumers. For every Nike employee, there's ten million consumers out there deciding whether or not the products and brands we offer really matter. … The ability we have to connect with consumers is the single most important competitive advantage in business today, and nobody does that better than Nike. There is no substitute for connecting with consumers, but it's really just the beginning.”

Nike’s Brand President, Charlie Denson, focused in his speech on the changing consumer and the particular demand for customization:

“[Consumers] want to be part of a community, whether it's a digital community or a virtual community, or whether it's a physical community. They want to feel like they're a part of something. They want to be engaged. …

And another thing that is very, very important to us as we look to the future is the value that the consumer is placing on customization. It's a very, very important part of the way that they interact with anybody or with brands today. We used to talk about the consumer in what we thought was specific, but in today in retrospect, feels like generalities, the fact that we used to put a 18 and a 22-year old in a same set of psychographic, demographic targets. Today, I can very comfortably say that the 18 and the 22-year olds are working on different -- they're living on different planets or at different places. As Mark said, these consumers have more choices than they've ever had.

What our challenge is to keep it simple, make those choices as simple as we can, and make them personal. We've spent the last, or in our case, 20 or 30 years trying to bundle things, adding value to a purchase or a relationship. And now, it's almost in reverse, because you have to unbundle everything if it's going to become customizable.”

During the event, the Nike Plus system was described as a perfect example of this strategy. Trevor Edwards, VP Global Brand & Category Management, describes the system and gives some numbers on its acceptance:

Nike Plus "combines the physical world with the digital world. We put a sensor in the shoe that speaks to the iPod, and you can hear how far you went, how long you went and how many calories you've burned, pretty simple thoughts. And then, when you dock it, you have a world of information at your fingertips. You get to see all that you've done, all your runs stored in a very simple, intuitive web experience where you can set goals for yourself. You can see how you've progressed. In fact, this week, I think we've put up -- you can actually map your run anywhere you go. In addition, you can join in the Nike Plus community where you can challenge your friends or other community members to run physically, but compete virtually. And since our launch, we have close to 200,000 members.

What do the numbers tell us today? First important fact, 35% of the members that we surveyed are actually new to using Nike footwear. So, we've brought more consumers into our franchise. The second part is, more than half of them are actually using the survey to service four times a week. And this is probably the most important statistic, 93% said they would recommend it to a friend, 93%. This is an incredibly sticky proposition, a great way to build loyalty for our brand and obviously build the business.”

Charlie Denson describes the growth plans Nike has with the system:

“That is a dedicated consumer experience. It is changing the game, and it's creating that competitive advantage for us. We would like to see 15% of all runners using Nike Plus, 15%. Now, that's not a very big number, except for there's 100 million people who call themselves runners worldwide. ….”

So in summary, this sounds like a big success and stresses that this really has been a clever idea to provide customization in this industry in a rather simple way, but in one that matters for consumers. And with the target of 15 million users, this would be one of the largest mass customization programs ever.

In another section of the event, Don Blair, Nike’s CFO, provided some interesting figures on the scope of variety that Nike is facing today. I often mention in my presentations the explosion of SKUs and variants that global brands today think to have to offer to create appealing products in heterogeneous markets. Nike seems to have recognized that just increasing the number of variants is not the ultimate way to appeal to consumers:

“SKU productivity. One of the great strengths of our company is our ability to create compelling innovative products that excite consumers. But there can be too much of a good thing. Each quarter we sell about 13,000 different styles of footwear and apparel and because of our high rate of seasonal turnover, we sell tens of thousands of different styles every year. And there are many additional styles that make it part way through the process, but don't end up in the final line that goes to market.

Each one of these tens of thousands of styles drives costs; costs for design, development, sampling, transportation, storage and sales. For footwear 95% of our revenue comes from about 35% of our styles and for apparel the figure is about 40%. …”

Costs of samples to provide this variety were given with more than $100 million. Given these numbers, an adaptable product like Nike Plus or a truly mass customized product, produced on-demand, sounds very appealing and much more efficient.

For the full transcript of the investors meeting, go to nike.com.

Automotive Customization 2.0: The MIT City Car project

The MIT City Car project was one of the initiators to host the upcoming MCPC 2007 World Conference on Mass Customization & Personalization at MIT. Coordinated by the MIT Media Lab, this project looks into the future of the car. And this future is much more than faster engines, a futuristic shell or more entertainment features in the car, but it is all about delivering a highly personalized mobility solution.

The main idea: The future of the car is a shopping cart. Well, a very special shopping cart. Sponsored by General Motors Corp., a team lead by MCPC 2007 conference chair William Mitchell and MCPC 2007 coordinator Ryan Chin, is building a prototype of a lightweight electric vehicle that can be cheaply mass-produced, rented by commuters under a shared-use business model, and folded and stacked like grocery carts at subway stations or other central sites.

The Boston Globe recently published a nice update about this project, and also has a great interactive graphic on its site that explains the concept. “Dreamers have been reinventing the wheel since the days of cave dwellers. But the work underway in "the Cube," the Media Lab's basement studio, may be the most ambitious remake yet.”, Globe writer Robert Weisman reports in this article.

The main idea to totally redesign the car was to move everything what today drives and controls the car into the wheels. Embedded in each of its four wheels will be an electric motor, steering and braking mechanisms, suspension, and digital controls, all integrated into sealed units that can be snapped on and off. With this design, the rest of the car can be designed totally new from the sketch. By removing as much hardware from the car as possible, a totally new design is possible.

The main visible feature is the car’s stackability. The idea is that you do not own a car, but just take one within a city when you need it – a modern interpretation of the (perfect) Boston based car sharing service ZIP car or Germany’s “Call-a-bike” system. As space is often a constrain in the city, cars will be foldable away to occupy as little space as possible when not in use. It is much easier to see than to explain how this will work, so have a look at this interactive graphic.

But the MIT team still recognized that cars often are an object of personal impression and more than just a seat in a public transportation system. This is where personalization comes into this system. . "We think of the car as a big mobile computer with wheels on it," Ryan is quoted in the Globe article. "This car should have a lot of computational power. It should know where the potholes are." And it also knows how you like your car. Once you have rented a car, the software that sets passenger preferences, changes the color of the cabin, controls the dashboard look and feel, and even directs drivers to their popular parking spaces next to their destination.

As the MIT researchers envision it, the City Car won't replace private cars or mass transit systems but ease congestion by enabling shared transportation in cities. Commuters could use them for one-way rentals, swiping their credit cards to grab a City Car from the front of a stack at a central point such as a school, day-care center, or office building. "What you'll be buying is mobility," Chin said.

"The existing infrastructures can't support the population growth that we're seeing, so we're going to have to find viable alternative vehicles like the one MIT is designing," Rebecca Lindland, director of automotive research at Global Insight in Lexington, is quoted in the Boston Globe article.

The MIT City Car concept transfers a piece of hardware into a product-service-system that delivers a truly customized service as a bundle of products and service components, some mass produced, some adaptable, some customized for each user. The first real working prototype of this car is scheduled for presentation on the MCPC 2007 conference. "I think we'll be driving it around the interior of our building," Chin said, "and hopefully ask the MIT police to let us drive it around a parking lot."

In a dedicated track on this conference, we invite researchers and managers to discuss this concept and present their own visions of the custom car of the future. (http://www.mcpc2007.com). In general, the idea of product-service-systems is a promising option for many customization offerings in several industries:

- Why not add a custom training plan to your custom sports shoe? (a great example for this is the Nike Plus Personalization program)
- Customization of cell phones may not only include a custom cover or your personal ring tone, but a service that configures your phone to your profiles, adds your phone books – and comes with your personal service plan that adjusts the pricing structure to your personal need.

IHT Reviews Bodymetrics’ Mass Customization Program at Harrods and Selfridges in London

Robb Young recently published a nice review of mass customization enabler Bodymetrics, London, in the International Herald Tribune. I visited this shop-in-shop several times and was appealed by its great design, but also noticed that store traffic seams to be slow. But as the IHT article tells, Bodymetrics is becoming a success story.

Bodymetrics uses a 3D Scanner to start the selling process with a 3D body of a customers. "Body shapes vary infinitely," Suran Goonatilake, Bodymetric's founder, is quoted in the article. "Classic measurements are merely body landmarks. One of the most crucial parts of getting any garment to fit right is shaping, how your body is curved. You can have two people with identical jeans measurements but the end result is a completely different fit."

Goonatilake started his mass customization venture from a project for the Centre for Fashion Enterprise, a business development program based at the London College of Fashion. The first Bodymetrics boutique opened in Selfridges in 2004, targeting a largely female clientele with private-label jeans and licenses with other denim brands. In 2006, a second boutique opened in Harrods, expanding the service to include women's tailoring for brands like Vivienne Westwood and Nick Holland.

This approach of using combining mass customization capabilities with existing brands and design seems to be very promising. Bodymetrics an enabler or intermediary, but does not have to build its own brand or designs.

Compared to most other mass customizers in the fashion world, Bodymetrics is focusing on a female clientele, Goonatilake says in the article. "At the moment, men's sales are still small but when we officially launch our men's range this spring, we're aiming for around 10 percent and the ultimate target is something around 25 percent" of the company's overall business.

Clothes are made in the Far East or North America in special factories that manufacture garments one by one and can do finishings by hand. Sales are good, despite high prices start around £250, or $482, per pair of jeans "We carry no stock, we're never on sale and we get the cash up front before manufacture," Goonatilake is quoted "That's why we have such very high sales per square foot — about $2,000 — and that's everything in retailing."

The article announces a competing version of Archetype’s Zafu service : Bodymetrics plans to scan a partner brand's merchandise in a variety of sizes and then can match an item to a customer's scan to identify any fit problems. Such a system would allow better fitting garments without expensive one-of-a-kind production.

Other then these details, the article reveals no new details. But it is another sign that even rather basic mass customization offerings are still an appealing topic for many papers – more than 15 years after Levi Strauss introduced its Personal Pair. And the journalist was very pleased with the fit of his trial jeans.

Interview: Detlef Schoder on the future of the newspaper, personalized printing, and how we can get our daily blog feed into the morning paper

Professor Detlef Schoder is known to me since years as one of the most active German researchers on mass customization. But he also is an entrepreneur and one of the driving forces behind the idea of a mass customized newspaper – a newspaper that is daily personalized according to each individual reader's personal taste and preferences. His company Medieninnovation.com provides technology and consultancy for custom publishing solutions. In this interview, he reflects about today’s state and the future of custom printing.

Prof. Schoder studied business administration in Germany at the universities of Munich and Passau. He obtained both his PhD and Habilitation (Higher Doctorate) from the University of Freiburg, Germany. Professor Schoder has worked not only in Germany, but also in the U.S.A., Republic of Kazakhstan, and Japan. He was an invited visiting scholar at Stanford University, MIT, and the University of California, Berkeley. In 2003 he became Head of the Department of Information Systems and Information Management at the University of Cologne, Germany.

His teaching, research, and project management focus on the economics and management of telecommunications in organizations, especially electronic commerce/electronic business, mass customization, peer-to-peer, ubiquitous computing, and new media management. In the mid 1990’s, he conducted one of Europe’s largest empirical studies on web-based electronic commerce. In addition, he in an adviser for electronic commerce to the German Parliament and consults the European Commission on research projects conducted under Information Society Technologies Framework Programme. Detlef Schoder holds a patent for “an individualized printed newspaper” (WO03052648).

Detlef, can you share a bit about your activities in this custom publishing business?

Our new cross-media product improo provides a synthesis between online and offline world. improo contains articles from high-quality newspapers, which are purchased for reuse, notifications from agencies and contents from our own editorial staff. Furthermore it includes internet elements, e.g. newsgroup messages, RSS feeds and blogs. New qualities are generated through calendar, forecasts and other information, which the reader can customize and add to his newspaper.

How is this idea different to the customized online versions of, for example, The Wall Street Journal?

First of all, improo is not restricted to an online version, but it is delivered as a real printed newspaper (which customers can take everywhere they want). improo provides information taken from many different sources, e.g. high-quality newspapers (like Financial Times, Wall Street Journal), Weblogs, professional journals, or information service providers (like market letter, newsgroups or notifications from eBay or Amazon). At the same time, a customized edition contains only information which meets each individual reader’s demands.

But why do customers want a personalized newspaper? Is not the element of surprise a major part of the enjoyment of reading the morning paper?

Most people are reading always the same sections of their usual newspaper. Day by day, they are overstrained by information overloads and spend a lot of time for filtering and seeking for the right information. Therefore improo saves time and fits the more individualized lifestyle of today’s modern society where people have several very special interests and hobbies. Furthermore improo still contains “surprising” breaking news and some kind of serendipity for this reason. And imagine, if you have much more news likely closer to your interests, or to the interest of your peer group, than -- I believe -- you will have much more surprising news and effects than a general newspaper can usually provide.

Who could benefit from your innovation improo besides the reader?

There is a clear business case. Not only our own studies, but other studies as well predict a market size of several hundred million Euros just in the German-language region. So anyone interested in becoming part of this great venture is invited to approach me for a joint realization :-)

This sounds like a perfect long-tail-application. Given these advantages, why do we not all read a custom paper already? I believe the technology is not the main hurdle anymore.

Technology is only one hurdle besides consumer acceptance and investment barriers. The improo system is a complex one which has to be developed especially for this purpose. Yet there is no product or system comparable to this. Although consumer demand has been approved by a representative survey, such an innovative product requires rethinking and open mindedness. But since people are getting used to customization through customizable internet online portals and news aggregation services, there is already a lot of acceptance. Actually many people already read customized news and retrieve specialty information via internet. A printed individualized newspaper is just the next evident step.

How do media companies and publishing houses react if you discuss your ideas with them?

In several discussions we discovered a wide interest in our individualized news paper. Especially traditional publishing houses suffer from shrinking markets and competition with e-medias. For them improo offers a chance to modernize their business and revive the media industry. However, it is a risky step to try this innovation and – so far- they do not want to take the risk. Others will…

Are there any other good examples of mass customization in the publishing industry?

First approaches to mass customization can be seen in regional/local editions and in books printed on demand. Also, direct mailings often include customized brochures or booklets. Customization in the internet (electronic editions of newspapers) is also common. But there is no publisher who customizes a printed newspaper for individual readers and delivers it to their homes.

Do you see any upcoming trends with regard to new players, technologies, markets, etc. of mass customization in the publishing industry?

As mass customization becomes more popular, new forms emerge, building especially on customer integrated innovation like user generated content. There is a strong demand for localized, specialized and individualized content with high editorial quality and augmented information with additional value like personal market letters or shopping assistants. There is also a new need for intelligent news aggregation. Just think of several millions of blogs out there. Even if only a fraction has high quality content, you still need filtering and customization to read the best and create a high quality of time spent with news.

Your role in the mass customization community is unique as your main job is that of a professor at one of Germany's leading business schools. So how can you connect your professional activities with your academic research? Can you share any recent results of your academic studies?

Yes, of course. The idea to create such a media innovation resulted from my academic research. Also many students and university staff members contributed to the project. Academic and business contacts combine well and I was able to build up a wide network in the areas of publishing, media and mass customization. The research primarily focuses on the acceptance and explanation of mass customized goods. It is evident that users have to invest time, money, and cognitive efforts.

On the other hand there are clear advantages of mass customized products over standard products. We develop integrated models which explain customer behavior and allow for extrapolation of usage patterns. All this is based on large scale empirical surveys and latest multivariate statistical procedures. Thus, academic insight as well as our market research not only advances science but also help to shape market communications and the effective introduction of such a disruptive innovation in the mass market of printed media.

In general, based on your experience both in practice and research, what questions should managers ask themselves when considering to enter the mass customization market?

Is the product suitable for mass customization? Do customers want and understand the value of mass customization? Is the market ready for such an innovation?

Is there a clear benefit of customization which is more than worth the effort? I think this is a crucial question managers should have an answer. Usually, only a market test campaign (piloting) can reveal the answer!

To conclude: What is, in general, the greatest mass customization offering ever – either one that is already existing or that you would like to get in the future?

This should come at no surprise: A mass customized newspaper. As we hold a bunch of patents in this field, we are at the heart of mass customized printed news. I am very optimistic to hold this innovation one day in my hands!

Contact: Universität zu Köln, Seminar für Wirtschaftsinformatik, insbesondere Informationsmanagement, Pohligstr. 1, 50969 Köln, Germany. Tel.: +49 (0)221-470-5325. E-Mail: Schoder@wim.uni-koeln.de

Information on the mass customized newspaper is available at www.medieninnovation.com

Why do people want to co-create and to customize?

A new book by Lisa Johnson provides some good answers -- and some great new case studies, too.

Yes, we know today that modern consumers not just want to solely consume, but are active and co-creating and (a few of them) co-innovating – and want just what they want.
But why is this so? This still is one of the fundamental questions – also for companies that want to benefit from “crowdsourcing” or interactive value creation.

To answer it, you either have to rely on heavy sociological texts or studies from anthropologists, or on pretty weak trend assumptions by marketing consultants (I have summarized both discussions in my German MC books).

One of the few exceptions is the great book by Harvard Prof Shoshana Zuboff and her manager husband James Maxmin, “The support economy: why corporations are failing individuals and the next episode of capitalism” (London: Viking Penguin 2002), which contains a great analysis why the (US American) consumer wants more personal service and customized offerings.

The focus of Zuboff and Maxmin are baby boomers, the post-war generation now in its best living and spending age. However, most co-creation activities that are cool in the moment come from younger generations, today 14-to-40-year olds. Also these consumers are savvy, sophisticated, and particular – and they are becoming more and more immune to traditional advertising, while exploring the huge choice of “long tail” markets.

Divided by marketers in the Generation X (30+) and Generation Y (teens and twentysomethings), these groups shape today’s pattern of consumption and value creation. And Lisa Johnson, a marketing consultant, does a great job in her book “Mind your X's and Y's: Satisfying the 10 carvings of a new generation of consumers” (New York: The Free Press 2006) to describe why and how.

What I really liked about this book is that it is all about Web 2.0 and Social Commerce without even mentioning these terms, but bringing them into a more general, better founded and buzzword-free framework.

Her starting point:

“Whether we like it or not, recent technologies have changed how our brains operate. They have altered the way today’s consumers think – not just what they but, but how they buy, how they act and react, and which products and services they find compelling.”

Resulting form this is a different mindset that Johnson calls “the five essential criteria” which describe qualities consumers expect from all kind of products:

- Experience: The desire to get out and try new activities, to explore, text, and see what is possible.

- Transparency: The market as an antispin zone. Full disclosure for companies and consumers alike with accountable choices and decisions.

- Reinvention: Due to fast adaptation of new technologies that allow to do old things differently, markets are a place of constant change.

- Connection: Cooperation of people blending their talents and perspectives to improve the experience for everyone.

- Expression: Anything is possible. The desire to express the layered facets of ones personality and individuality by customization and personalization.

These five criteria inform how consumers operate in the market. And Johnson uses them to describe ten consumer cravings that cross industries and age brackets as they drive – in her opinion – every decision made by members of the Generation X and Y. Let me introduce five of them which seem more relevant for the themes of my blog. While the following quotes describing these trends are pretty much marketing-jargon, their description in the book is actually more profound:

Shine the Spotlight: Extreme personalization gives marketing a new face: "Clamoring for personal recognition. They’re itching to stand out, stand up, and be celebrated with their names in lights (or print or pixels). Brands that tap into this powerful need with highly creative efforts will get not only great buzz, but a whole new level of loyalty and brand ownership to match."

Make Loose Connections: The new shape of “families” and social networks. "This generation is rejecting traditional associations and club-style memberships in favor of loose connections that more accurately reflect their interests, lifestyles and busy days."

Filter Out the Clutter: Editors and filters step into a new role of prominence. "In a world that’s inundated with choices, editing is a critical market phenomenon and an important process in our daily lives. Consumers rely on editors to sift through the raw data and identify the top picks. As a result, many savvy brands are learning to build editing mechanisms into their brands, products, and websites.

Keep it Underground. The rejection of push advertising and the rising influence of peer-to-peer networks. "A select group of people discovers something new, from shoes to bands to politics to neighborhoods, and translates it to satisfy a much wider audience. This is the way of the underground."

Build it Together. Connected citizens explore their creative power and influence change. ".. we’ve only just begun to tap into the power of web-based networks. The Connected Generation is becoming intoxicated by their growing ability to spark change – both as consumer groups and end users. This awareness is spurring mass creativity and launching a power shift away from companies and into the hands of consumers."

And, just for record, the remaining five carvings are:

- Raise My Pulse. Adventure takes its place as the new social currency.
- Give Me Brand Candy. Everyday objects get sharp, delicious, intuitive design.
- Bring it to Life. Everyday activities are orchestrated to deliver a dramatic sense of theater.
- Go Inward. Spiritual hunger and modern media find common ground.
- Give Back. Redefining volunteerism and the meaning of contribution.

Regarding her first trend, Shine the Spotlight and Extreme Customization, she provides a number of good arguments why consumers want this kind of customization and expression of their personality – regarding the need for (mass) customization especially for product offerings that address aesthetic design and personalization:

- People are burned out. “Consumers are cynical and extremely educated about the entire marketing process. Add in a collective obsessions with celebrities, and people everywhere are longing to experience the insider treatment. They want to feel like someone really cares about their dreams and desires.”

- People have seen what is possible. New tools and websites allow consumers to share their unique personalities.

- There’s a sense of entitlement. “I deserve it and I am ready for it now, is the common attitude.

- People want profile in familiar formats.

- People want promotion without the appearance of self-promotion.

To illustrate this trend, Ms. Johnson uses a number of case studies which I personally find not too extreme or convincing, there are much better examples out there (like the new Adidas Pars Innovation Lab, DNA Style Lab’s idea or Build-a-Bear): Jones Soda that allows you to place personal labels on standard soda, Iamtoy.com, who create handcrafted superhero alter egos of your loved ones, DNA Artwork that uses your DNA for a custom picture. But you ge the point.

Among the many other, much better case studies in the remaining chapters of the book, is the venture of an active member of our mass customization community: Andreas Schuwirth (http://www.xxpo.de), who developed a body measurement solution for the bike market that allows a totally new sales experience there. The book describes in large detail the application of this system in a new chain of bike stores in the US, "roll:bike". These stores are envisioned by an industry outside, Stuart Hunter, who wants to provide customers a custom shopping experience with a highly edited and customer-centric store. The book describes here a great case study of an offline-customization (matching) system that really provides customer value.

What the book is missing, however, are all forms of co-creation that go beyond operational marketing or improvements of merit, but which do address topics like lead users or other forms of user innovation (Patty Seybold’s book does a better job here). Ms. Johnson stays in the traditional regime of thinking – but this is also where most co-creation activities do take place anyway.

I could go on with quoting from this book, but just recommend that you get a copy and read it for your self.

Offline Customization -- Morgan Miller Fashion Shoe Workshop in South Beach, Florida

Madeforone today discovered the link to an interesting story in the Miami Herald about another off line experience for footwear customization.

So to continue the stream of posting around this theme, here some extracts from the Miami Herald article. For me, the entire concept sounds very much like the Via Della Spiga Concept store of watch maker Swatch where consumers also can co-create (craft) their own custom watches in a store (see old posting on Swatch's customization store). I believe that there is still much growth potential in this business model.

So this is what you can do – since Nov. 1, 2006 -- in Miami at Morgan Miller (1634 Euclid Ave., Miami Beach, 305-672-6658), a customization boutique owned by Morgan Miller, 24, a graduate of Marymount Manhattan College with a bachelor's degree in communications:

“Ever find a pair of strappies you loved, except the straps were all wrong Now you can design your own—from the heel up—at Morgan Miller, a unique design-and-go shopping experience that takes only 30 minutes. At 24, designer Morgan Miller, owner of the new South Beach boutique, has put an innovative, rock star spin on the shoe-glutton movement.

''We provide the ingredients for women to be their own designers so they are able to put their own stamp on things,'' said Miller, a New Jersey native. Clients choose from a mélange of soles, straps and buckles to create a shoe exactly to their liking, at prices ranging from $150 to $500.

There's a buffet of kitten heels, cork and wooden wedges of various altitudes and attitudes. There are high heels, low heels and chunky heels in black or white lacquer. Straps can be had from more than 100 options, including lizard, python, ostrich, alligator, leopard-print hide and the leathers: patent, metallic and pearlized. Buckles can involve Swarovski crystals or faux bamboo Strap and buckle samples are attached with Velcro to a wall of black velvet so clients can handle all their options. And once the style combos are chosen, bubbly is served and the foot is measured.”

Another website, Daily Candy , describes the customization process:

Step 1: The base. Stiletto, kitten heel, cork platform — she’s got you covered, from beach to banquet.

Step 2: The strap. Go conservative with black or sex things up with turquoise python — there are plenty of fabrics and colors to choose from.

Step 3: The accessory. You’ve got more than 100 options: Bling out with crystals and jewels or keep it simple with a silver chain or nothing at all. Of course, you’re not expected to actually make the shoes. The in-house cobblers take care of that.

But in the end it is all about the experience, as the Miami Herald writes:

The boutique resembles a candy store for grown-ups. Big candy jars hold rhinestones and other embellishments. Crystal chandeliers illuminate the sparkling shop. The shoes, which can resemble those by Jimmy Choo, arrive a mere half-hour later—on Tiffany & Co. silver platters. ... A self-confessed shoe freak, Miller plans to expand her made-to-order shoe business to include handbags and belts, but with a longer turnaround of two-three weeks.

Context information: Previous postings on offline customization stores:
- Adidas Paris miAdidas flagship store
- Selve Footwear Customization Experience
- DNA Style Lab
- Korean iFashion project with virtual mirrors
- Personalization Stores collection- at CS Scout
- Via Della Spiga Concept store Posting in old newsletter

Adidas Finally Adds Experiment & Service to its Mi Adidas Product – New mi Adidas Innovation Center Opened in Paris

I recently wrote about the opportunities of bringing mass customization into stores and selling the experience as much as the custom product (see the DNA Style Lab posting). Now Adidas, a premier example of mass customization in my talks and lectures, has expanded its in-store presence with a huge new mi Adidas retail outlet in its new Paris flagship store.

The 1,750 square meter Paris adidas Sport Performance store occupies two floors on the Avenue de Champs Elysees and features a wide selection of adidas products. The core part of this store is a pimped mi-adidas sales system, called mi Innovation Center (mIC):

"The "mi Innovation Center" will change the way consumers shop and their expectations at retail. It is a true first and we are thrilled to premier the mIC in Paris offering customers a whole new dimension of interaction with adidas products," Karen Feldpausch-Sturm, Senior Vice President of Global Retail for Adidas, is quoted in a press announcement. Adidas, headquartered in Herzogenaurach, Germany, plans to roll out the new high-tech concept stores in major cities worldwide, including one in China in the run-up to the 2008 Beijing Olympics.

Features of the new customization unit in the mIC include:

# A large glossy, black cube is the focal point of the center. Here, customers can customize their own "mi adidas", using now a larger flat-screen configurator to alter the details of the shoes by simply pointing a finger to the screen. Laser and infra-red technology then translate the gestures into commands. Foot scanning and pressure scanning is done as in the mi adidas stores before.

# New is also a virtual mirror where users can see their personalized shoe on their own foot without even removing ones shoes!

# But customization is not only high-tech: Customers are accompanied by specially trained "adidas experts" who, like a personal trainer, advise on nutrition, exercise and products. With a portable hand-held PC, the sales associates record a consumer's personal data and desires, creating a user profile that he/she can view at their convenience via the internet.

# In addition to the cube, the center also provides some insight into new approaches of selling standard products: At a table, a sliding carriage can be moved over a desired shoe and then specific product information will appear on the screen via Radio Frequency Identification (RFID) technology.

Update: On YouTube is now a Video showing exactly the new mi adidas customization process (thanks to Rebang for the link).

I don't had the opportunity to visit this store in person, but a sneaker enthusiast posted a nice review on the BKRW blog (the reviewer seemed to have not heard before that Adidas is offering basically the same service since 2001, thus not in such a fancy retail outlet):

"Well, to be honest we were really impressed and can't wait to test it for real (don't worry we will be in the first row…) ! The concept is really simple, it's a kind of NIKE ID applied to performance shoes. It means that you can customize our own performance shoes, according to the way u need it. You can change the design, change the colors, add some words or some special tags, but most of all you can even materials of the shoes : sole, mid-sole, chassis, uppers, studs… The truth is that ADIDAS is pushing the whole performance concept with the even way of customizing your shoes, because even being in MI INNOVATION CENTER is a travel into the future: as we said you are running on a video carpet, each salesman has a touch screen tablet to change into real time your adjustments and preferences, while you are directing your mouse on the menu screen by the means of a laser system of pointing…"

Is all this just another marketing gimmick?, asks Business Week in a report about this store.

My answer is yes and no. Regarding customization of the product, it is just a pimped up version of the mi adidas retail units that are in place since years. But regarding the overall strategy of customization, it is a large step forward. For the first time, the company is not focusing on the custom product, but on the custom service and experience users get when purchasing the shoe. The custom nutrition program and fitness guides offer much more value as yet-an-other color-option at NikeID. So while Nike had an easy win with the Ipod-Nike-combination offering individual tracking of your running behavior, I think Adidas has beaten its competition with this integration retail innovation by far – if they are able to scale up this system and deliver what they promise.

Business Week quotes Fiona Fairhurst, director of Zero Point Zero One, a sports consultancy in Nottinghamshire, England, on this:

"These days if you look around the gym, everyone is their own fitness expert. People know how to use heart-rate monitors and measure their own level of hydration …An individual will steer clear of a brand that doesn't fit properly, no matter how exclusive that brand is. If you know that Adidas fits you perfectly and comfortably then they have a customer for life."

DNA Style Lab goes Beta: A new model for the custom t-shirt economy that also looks beyond the internet

If the number of new ventures started around one idea is an indicator for the strength of this trend, then custom t-shirts and related fashion items are the hottest area of mass customization in the moment. I lost track of all the recent announcements of new sites where users can co-design their t-shirts. Next to "established" forerunners like Spreadshirt, Cafepress, or Threadless numerous start-ups entered the customization world recently. Have a look on Adam Fletscher's t-shirt blog to get an overview in form of his great interviews with the founders of the players in this custom t-shirt economy.

So just let me introduce you to one of these upcoming sites: DNA Style Lab, the brainchild of Samantha McDermott, who got first experience with customized handbags in the late 1990s. Her idea is to combine elements of some of the existing systems of the custom t-shirt economy with new ideas.

The core idea is that the company commissions a number of artists from around the world. These artists are in varying stages of their careers, some are already more established, others are just getting known. Artists will contribute design elements which consumers than can place freely on different apparel products and accessories. Pricing of the products is modular: the more graphic elements an user selects, the more expensive the final product gets.

If artists allow, consumers can also change certain aspects of the supplied art. The company itself makes its profit from selling the core products (US $10-20 for American Apparel garments), artists get the full price users pay for the graphic elements they select (about $5).

Sounds very much like Stagr or Innertee ... sites which do not leave the entire co-design process in the hands of the consumer but propose to split the process: Experts provide the input and variety by basic designs, individual consumers get the freedom to combine these elements, providing them the experience but not the pain of a co-design process.

But what makes Ms. McDermott's venture really special is her plan to stay not just in the online world, but to move also to brick & mortar stores where customers can actually leave the store with an item they designed. I think this is what it requires to grow and scale the idea of aesthetically customized fashion products. In the end, the major value of a custom t-shirt or similar product is not additional ergonomic value due to better fit or function, but the hedonistic value of experiencing the co-design process itself and the rewarding feeling of the final product.

Mass customization pioneer Nike also discovered that just offering custom shoes online is not enough and thus opened its NIKEID Lab in New York's Elizabeth Street, and Puma even started offline with its great Mongolian BBQ. And one of the largest mass customizers – and a real role model for me – Build-a-Bear, has founded its fantastic growth story entirely on offline customization, selling in the end more the process of customizing a toy than the custom product itself.

Given the joy of shopping for fashion products for many consumers, a business model based on providing co-design in an offline environment could become a large success. There are some local players in this area (like Neighborhoodies in New York or George&Frank in Munich), but not really scalable and thought-though system that could replicate Build-a-Bear's success in the toy industry for the fashion industry.

For a start, however, DMA Style Lab is still an online business only. Its present toolkit is obviously very beta and demands a few minutes to learn, but then is easy to operate. The company told me that this will be improved very soon, including the order taking process. But you get already a good idea about the basic elements of the concept: The main focus today is on the artists who provide the work. This is a great combination of the co-design trend with its countertrend: strong orientation at external peers and idols.

They will be adding a "Soundlab" function soon -- discover independent artists (bands) so that you can listen to their music while designing you new t-shirts. As with all of these sites, functionalities to support the community of users and artists are crucial for success. Here, the usual tools like customer pages, upload of user photos, sharing of designs, forums, etc. will be implemented.

I am curious to see how these ideas will come into place and which segment of the market DNA Style Lab will be able to capture. The traditional market for custom graphic t-shirts (fashionable late teens and young tweens) has been occupied by the existing labels (many of them working in the traditional way without any customization). But Samantha McDermott and DNA Style Lab may be able to create a new market of custom customers, older and perhaps more sophisticated, also more interested in art than in music.

Context information: Here are some links to recent news around the custom t-shirt economy:

- Innertee (see my previous post) went beta last month
- STAGR plans to allow the customization of top brands (Great three-part interview on HipHipUK)
- And (if you speak German) a collection of recent posts on Exciting Commerce on Custom T-Shirts and related products,

Footwear Customization 3.0: The First Rapid Manufactured Shoe

Footwear customization brought to a really new level: Today, I had the opportunity to have the world's first working prototype of a totally new shoe concept in my hands: a 100% laser-sintered shoe. What looks like a normal shoe, is a real revolution and one of the largest achievements I have seen in the mass customization world.

The shoe, developed by Marc van der Zande from TNO Science and Industry (a Dutch research institute) and independent designer Sjors Bergmans of Sjors Bergmans Concept Design, comes out of the manufacturing machine as you see it in the pictures on the left – in one manufacturing process, no assembly required (only some finishing, polishing, etc.)! And no one cares any longer if each product is custom or just a replication of a standard design.

The TNO shoe concept, named 'Head over Heels', is the first application of rapid (digital) manufacturing technologies (more about RM) to an entire product in the footwear industry. Such a concept would allow the rapid customization of shoes to a radical extreme – without any of the constraints of conventional custom manufacturing mechanisms like the need for custom lasts, custom cutting of materials, and a new organization of the work process in manufacturing. With rapid manufacturing, a digital design (CAD) can be transformed directly into a tangible product.

In an earlier venture, UK-Based Prior2Lever introduced a soccer boot that contains a rapid manufactured component, the outsole. But the shoe developed by TNO goes much further. To come up with such a concept, the entire design of a shoe had to be redesigned. A flexible element in the sole allows for high flexibility, and integrated elements in the upper are providing flexible hold.

In the moment, this project is in the proof of concept state. According to a colleague who tested the shoes (in the first design just available in a 38 size), they are at least as comfortable as conventionally produced shoes. Future development will include a wider range of models (including a model for men) and an easily scalable design so that in the end a foot scan can automatically be transferred into a custom design. Also, manufacturing costs have to go down. Today, a pair of rapid manufactured shoes comes still with a heavy price tag of 600 Euros. But TNO project manager Marc van der Zande expects that production costs can be dropped to less than 100 Euro within a few years, given the present speed and scope of application of rapid manufacturing technologies in many industries. With this larger scale, materials and machine costs will become much cheaper.

For me, this shoe presentation today was a great glimpse into the future. Just think five years ahead: Then you may really get your feed scanned, and a moment later, your new shoes will be 3D-printed immediately in the store. With this, the long tail of footwear could be driven to an extreme! But most important, the 'Head over Heels' concept provides a strong further proof that digital manufacturing technologies like laser sintering are not just for prototyping any more, but are rapidly becoming a standard manufacturing technology.

More information on the 'Head over Heels' Laser Sintered Shoe:
- For more information on the footwear design, contact Marc van der Zande (marc.vanderzande AT tno.nl) or Sjors Bergmans (comengo AT gmail.com).
- The concept will also be presented on the TNO Symposium on Rapid Manufacturing, Evoluon Conference Center in Eindhoven, The Netherlands, Tuesday, Oct 31, 2006.

Context information:
- Jochen Krisch recently had a good overview on companies offering rapid manufacturing capabilities for everyone in his blog.
- John Marshall writes about the older, but still great application of rapid manufacturing for the lamps of the Benelux company Materialise.
- And my own more recent posts on customization of footwear, Open Source Footwear and the interview with Sergio Dulio on latest developments in this area.

Outside Innovation: New book by Patricia Seybold builds a bridge between open innovation & mass customization

Outside Innovation: How Your Customers Will Co-Design Your Company's Future, by Patricia B. Seybold. New York: Collins, October 2006. ISBN: 0061135909, about 26$.

This book review has been overdue for more than two months when I got the pre-version of Patricia Seybold's new book, "Outside Innovation". I immediately read it with very large interest, as Seybold is one of the authors I have quoted often in my own books. In her bestselling title 'Customer.com', she provided a great analysis of how the internet is changing consumer markets. So meeting her here in Boston for several occasions in the past year and discussing with her some ideas of her new book was a great opportunity. Here is the result of her recent research: In "Outside Innovation", Patricia Seybold provides one of the first general-management books on co-creation of value between firms and customers.

Well, there have been other books on this topic before (starting with the great, but today almost forgotten book by Rafael Ramirez and Richard Norman on Value Co-Creation [1994: 'Designing Interactive Strategy'], Prahald & Ramaswamy's [2003] highly abstract book on customer co-creation, and of course Eric von Hippel's [2005] fantastic review of three decades of academic research on user innovation in 'Democratizing Innovation'.

But Patricia Seybold's book is full of great and very up-to-date case studies that make the idea of value co-creation really lively and accessible. She describes (in great detail and with plenty of background information) many classic examples like Lego's co-development of the new Mindstorm toy, Threadless, Flickr, BBC Backstage or National Semiconductor, but has also some great new (at least for me) examples of customer-centric innovation like the development of a new fitness machine (Koko Fitness – great story and concept) or SEI Wealth Networks.

And her pitch line why her book is important tackles one of the main problems of integrating customer and users in a firm's innovation process:

"The good news is that customer-led innovation is one of the most predictably successful innovation processes. The bad news is that many managers and executives don’t yet believe in it. Today, that’s their loss. Ultimately, it may be their downfall."

I hope that her books can support more mangers to consider customer/user integration not only as a nice add-on pilot initiative, but to make it a crucial part of the company's core strategy. The book, however, offers no recipes or frameworks how a manager could do so. Its core contribution is to document and describe what is happening in a world that is not any longer dominated by companies creating things FOR users. And as Seybold does this in great detail and style, this record of promising practices may convince managers to turn away from old prejudices.

Patricia Seybold bridges in her book between innovation and operation, between users and customers, between leading edge contributors and average customers. Eric von Hippel strongly differentiates between these levels. He argues that for functional novel innovation, firms have not to listen to their present customers but to search for "lead users" who face a specific need ahead of the market and have turned this need already into a solution for themselves. In many cases, these lead users are in a different domain than the manufacturer and are not its present customers. Gathering input from lead users thus is totally different to market research methods of any kind.

Seybold uses the term "lead customer" to describe a group of a firm's current customers who are truly innovative: "These may not be your most vocal customers, your most profitable customers, or your largest customers. But they are the customers who care deeply about the way in which your products or services could help them achieve something they care about." Getting their input may also be the result of a more conventional market research approach.

This distinction is worthwhile to note when you read the book. Otherwise, without previous knowledge, you may get a bit confused where in her cases real innovation starts and more general customer-focused business strategies end. But as she argues, this is exactly the beauty of co-designing with customers: You start with some small steps, perhaps within the context of a mass-customization-toolkit, and suddenly your customers want more and get motivated to innovate on their own.

My conclusion: A book very worthwhile to buy and read. Its great collection of case studies will inspire you to look for more and deeper information on this topic – or to start to brainstorm immediately how you can benefit from the creative potential of your customers.

For abstracts from the book and an insight into the cases, have a look in Patricia Seybold's blog, http://outsideinnovation.blogs.com.

Trend: Ultra-Cheap Custom Clothing – How Ziami uses multi level marketing schemes to sell custom goods (UPDATE)

(This is an updated version of the original post.)

I always have argued that mass customization has large potentials for huge cost savings along the entire supply chain. Established companies like Dolzer in Germany have shown since 25 years that custom made clothing can have the same price tag as conventional standard apparel (in the 200-300 Euro range for a custom suit, 50-70 Euro for a custom shirt). Most mass customization clothing offerings, however, come in a price range of 800-1000 Euro (far beyond the price of bespoke tailoring, but with a premium to your average Boss suit).

But as everywhere in retail, there seems to be also a trend of discountization in mass customization: New players like Ziami or Aston offer CUSTOM made shirts for 29 Euro, and a custom suit for 99 Euro. Especially Düsseldorf, Germany based Ziami seems to enter the market aggressively with its range of custom apparel items. Manufacturing is done in China and Thailand, measurements are taken by sales associates by hand, fabrics are cheap and limited, but the customization options quite large. Ziami's approach is based on a multi-level marketing (or: pyramid) approach. This means, all products are sold by independent sales associates who purchase a 50 Euro starter package that enables them to become a custom shirt seller. This package includes everything to sell Ziami shirts, like a "How to measure"-DVD, one sample shirt, fabric samples, measuring tape, needles, 50 ordering flyers, 50 promotion flyers, a brochure containing all the necessary information and the official license to sell Ziami clothes. Distribution partners purchase a custom shirt for 22 Euro, and resell it for the suggested 29 Euro. In addition, they are motivated to recruit further sales associates, as they will participate also on the margins generated by those 2nd tier partners.

One of the more active Ziami partners, Stangl in Vienna, Austria, has described this system very neatly in an English presentation on their web site. And another motivated promoter of the company has even created a nice YouTube Video that describes the system and provides some insight in the rather easy measurement process.

Can you make a custom shirt for 29 Euro? Yes, of course, given that consumers are willing to wait (as for this price, you cannot use single item air-fright from Asia to Europe) and compromise for the quality of the fabric. Reviews and feedbacks by customers on the internet are mixed. Some really love the system, others are rather annoyed and complain about unstable quality, bad customer service and poor fabrics (just Google Ziami and you find numerous forums and newsgroups discussing Ziami's shirts).

According to their own claim, Ziami, founded in 2003 by Designer Ersin Canga and Philip Kamp, have risen to become Europe's #1 Producer of Custom Tailored Shirting (however I could get no proof for this, interview requests with the founders were not answered). Ziami most recently expanded its offerings to include Custom Designer Jeans and Cashmere Sweaters available for $29.95 each. Also belts and other accessories are offered in "custom designs". But what really astonished me was the price for their custom shoes which will be offered soon: "The shoe is made from the highest quality leathers to your exact foot measurements for just $79.95 ($600 retail value)". From everything I know from footwear customization, this price is not possible, neither with manufacturing in China or elsewhere, given that this is a real custom shoe.

Is this good or bad mass customization? Well, I am not quite sure. I think the danger of such a system is that it cannibalizes the efforts of higher-quality vendors of mass customized apparel. It also is a low-tech version that depends strongly on the personal skills of each sales associate (this I reagrd as the largest challenge of this model). It may also discourage customers to try more custom goods once they purchased a Ziami shirt, waited for 4-8 weeks to get it delivered, and then were disappointed by the cut and quality.

On the other hand, this system shows what you can do if you really rethink the value chain in the apparel industry. Extreme cases, as this ultra-discount mass customization offering, are always great examples to study and to test the boundaries of a system. As such a case, I really appreciate this experiment and will observe curiously where this will lead us.

Update:
Just by chance I had the opportunity to order a custom shit from Ziami recently. I will report here how this works out and how it fits. And I learned that the 29 Euro retail price for the custom shirt is just marketing: You always have to pay a 5 Euro handling & shipping fee per shirt, also if you order several at one time. And then there is a 10 Euro "measuring" fee for you firs shirt. So in total, you pay 44 Euro -- which sounds not as spectacular as the 29 Euros before (and there are many players in this price range -- with local manufacturing and professional tailors taking your measurements -- and MUCH faster delivery).

Also, Ziami's headquarters seem to make most profit not from selling the custom products but from selling marketing materials, order forms, web hosting, etc. to their resellers. These standard items are much more expensive than the shirts (in comparison).

The distributor selling me the shirt told me that the start phase for custom suits (99 Euros plus hidden costs), custom jeans (29) and shoes (79) has just started -- meaning that in the moment only the independent distributors can order.

UPDATE TWO: Eight weeks later, the shirt was delivered. As I ordered it in Europe and was in the US when it came, I only today (Feb 2007) can evaluate the fit: To make it short, this shirt does NOT fit. The arms are at least an inch too short, and the shoulder area too tight on the bottom and too long on the top. The quality of the fabric, the finishing of the shirt, the buttons etc. are, however, good. It also came in a nice package, and I liked the feature that I got an extra piece of the fabric for my pocket.

This experience reveals one of the largest challenges of mass customization: get the configuration process correctly. Ziami relies on independent sales agents, and the quality of your products will depend on their personal skills. I always preach that the basic principle of mass customization is process stability, and this is what Ziami lacks totally in the order taking process.

In my case, the sales agent was a very nice, but apparently "fresh in the business" management student from Vienna who probably lacked the correct skills to get the measurements correctly. Established, vertical integrated mass customization providers often report from the difficulty to get qualified sales persons with adequate skills for the measurement job (or they just invest in 3D scanners to avoid this problem), and so I do not not see how an independent part-time Ziami reseller shall learn this without much "trial-and-error" learning using his or her first customers.

Also, prices are calculated in a way that for 99% of all Ziami agents this business will only be a small side business. With about 35% margin (based on very cheap goods) and a personal sales process, you can not become rich or make this your full business -- and thus only few Ziami agents will develop strong learning effects to get an expert in the order taking.

So my conclusion: This is an interesting concept, prices are very good. The product I got was nice, but did not fit. The main problem: The Ziami system lacks the most important aspect of a mass customization business: stability in the configuration process (and I do not see how you can add this with their pricing model in a multi-level marketing scheme). Thus, if you order, do so only with an experienced agent, probably someone who is from the clothing business and not just your next-door neighbor.

Custom Fashion 2.0: How a new Korean project wants to lift mass customization in the apparel business to a new level

On Monday this week, the i-Fashion project was launched in Seoul, Korea. I was invited to speak at the opening event of this interesting initiative. Its objective is to create an entire infrastructure for mass customization in the fashion industry by integrating a number of technologies which today have not been applied in larger scale. Sponsored by the Korean Ministry of Commerce & Energy with about US $7 mil., it combines a consortium of 9 apparel companies and a few technology providers.

As you would expect from a high-tech country like Korea, the exhibition on the opening even was dominated by numerous huge flat panel screens. These screens were, however, no sheer illustration but actual part of a totally new selling process. The entire process builds on virtual models which are generated by a 3D body scan of a consumer. The customer can then create on a touch-screen kiosk her new apparel, including the design of the fabric. Designs are illustrated real-time on the customer's avatar. This avatar and virtual garments shall be also used in mobile applications (where South Korea is famous for) and traditional online shopping environments. Also this idea is not new, but has – to my knowledge – never been integrated in a real shopping infrastructure. One of the project partners, the Hyundai conglomerate, will open a test store in its department store chain already this year.

A co-speaker on an international seminar for this project was Prof. Nadia Magnenat-Thalmann, a leading expert in virtual modeling and the Director of University of Geneva's MIRALab. I had heard of this lab before, but was astonished to see the scope of its activities. Prof. Magnenat-Thalmann reported from her work as part of the LEAPFROG project, an European project with the objective to modernize and ultimately transform the European clothing sector into a flexible knowledge-driven high-tech industry. Drivers of the project are a radical move towards rapid customized manufacturing through flexiblization and integration of cost-effective and sustainable processes from fabric processing to customer delivery and a new focus on customer service. MIRALab contributed to this project with the development of a 3D virtual try-on platform, including real-time body sizing and cloth simulation.

Projects like i-Fashion and LEAPFROG are very important for the realization of mass customization in the clothing industry as they go beyond automatic pattern generation (based on 3D scans) or flexible manufacturing technologies, but try to create an integrated platform where most of the traditional physical design, manufacturing, and sales processes are shifted to the digital domain.

One of the interesting parts of the project i-Fashion project in this regards is the large scale application of digital-printing for high-end fashion items. This enables the efficient productions of individual patterns and may solve the problem of huge inventories which are required for customization on the component level. i-Fashion Project partner Yuhan-Kimberley demonstrated their latest existing technology during the opening event. I was surprised by the quality of the printing process, but also its speed and cost efficiency (comparable to normal paper photo printing). Also, the garments do not need any further processing or finishing after the printing process. This technology, which shall be improved even further in the project, but first of all integrated in a complete business model, could allow also the legions of custom t-shirt printer a more sustainable production technology compared to today's heat transfer process.

More project info in case you speak Korean: http://textile.konkuk.ac.kr/englishhome/index.html

Or contact the project;s director, Prof. Chang Kyu PARK from the Department of Textile Engineering at Konkuk University, Seoul (cezar@konkuk.ac.kr).

Printing T-Shirts and Money – Inside Story in the Chicago Tribune on Threadless

The Magazine of the Chicago Tribune, one of the large US quality newspapers, recently featured a LARGE (7 page) cover story on Threadless and their user-design t-shirt business. I talked extensively with Steve Johnson, the article's author, some weeks ago about the business idea behind Threadless. He did a great job in documenting the past, present, and future of Threadless. Read the entire story here.

Here are some interesting quotes from this article:

The Art-Gallery Model.

"They [Threadless] have this innate understanding that what they are really selling isn't a T-shirt so much as the tale of how it came to be, a narrative that involves an artist, a community and a company that sets itself among, rather than above, that community.

"I always compare it to an art gallery," says Nickell, who's 26 and holds the title of president because, in addition to programming the site … and doing designs of his own, he deals with the lawyers and accountants and landlords. "You have people who come in and look at the art, people who made the art, people who are buying the art."

User manufacturing. In the article, Jim Coudal, a Chicago based consultant, summarizes the Threadless model with the great phrase "If they come, we will build it." And indeed, that is some of the quintessence of the Threadshirt business model -- and of other businesses which focus on providing manufacturing capabilities to users:

Threadless is "not building something and selling it to an audience. They're building an audience and selling them what they say they want. .. The Internet has also helped Threadless find and take advantage of the world's "distributed creativity." Just as there are great writers who now have an outlet via blogging, there are great designers who have an outlet via things like the Threadless competition."

Interactive value creation. Steve Johnson then quoted me very neatly, summarizing why Threadless is a perfect example of "interactive value creation":

Distributed creativity "is a very difficult thing to get. In a normal company, you identify the coolest artist and commission him or hire him. What they do is they broadcast their problem: Who makes me the best T-shirt? From an economic point of view, you don't have to know who is the best person. You let them self select. Of course, it only worked because, in their case, they have a lot of desperate artists out there. You have a lot of unemployed graphic design graduates. And they somehow exploited this, but to mutual benefit."

Fashion as Pop-Songs. Patric King, a prominent Chicago designer, compares in the article the Threadless model with a pop song:

"What [Threadless is] doing is just sort of building the wearable equivalent of the pop song," King says. "They throw it up and see what climbs up the Top 40. I've run across a couple of other companies trying to do the same thing, but the work's just not as good. For some reason they just get prettier stuff. Their community has just sort of trained themselves that that's their standard."

A new support industry. Share of labor is the oldest economic principle. And it also helps at Threadless. The article reports about Cody Petruk, a graphic designer for a Canadian software company who owns "about 60" Threadless tees and has seen three of the 13 designs he's submitted get printed. But Petruk also runs a web-site, threadies.org, which supports user designers to participate and win in the Threadless contests. A consultancy for t-shirt designer (McKinsey and BCG, listen!).

The limits of the Threadless model.

"But there are also questions about how much growth a community can endure before it stops feeling like a community. Right now the site is a free-flowing and very entertaining mix of design submissions, which registered users grade on a scale of one to five, blog postings about the designs, links back to other projects and, of course, the store. In a recent week, Nickell says, they had almost 10 million page views from just 500,000 unique visitors.

But already, some longtime site users grumble that as the group has grown, the designs have moved away from their artsy roots and become too cutesy, too clever or too pop. The all-time best-selling Threadless shirt certainly isn't cute. Called "Flowers in the Attic," it depicts a svelte young woman shooting herself in the head, causing birds to fly out. The company has sold 30,000 already, compared to a typical first printing of 1,200 shirts, and is printing another 10,000 for the holiday sales rush."

And the article finishes with a job offer: The Threadless founders are currently considering to hire a COO to run the daily business of the company. Condition: a suit and no t-shirts.

After the article has been published, the Threadless users commented quite enthusiastically. One comment, posted by Radioactivejosh a few hours after the article was published, provides a great perspective why users love Threadless:

"The article hit it right on point; we don't just buy the shirts for the design, but for the story, the meaning, the explanation and the excitement of new prints. It all plays a factor. If I didn't read the explanation of Poet-Trees and I just saw it in Target, it would mean nothing to me. ...

I LOVE when i see people with Threadless tees, because i feel like I know them. They understand the shirts, they visited the site and browsed and saw something they liked. They weren't just trying to be trendy and went into Urban Outfitters ad bought a tee shirt they saw. Threadless tees have a lot more going into them than just buying them."

More information:
- The entire Chicago Tribune article in full text.
- The article with all pictures as an user scan.
- Discussion about the article at Threadless with more customer voices.
- My report on Threadless in this blog
- How Look-Zippy developed the Threadless model further

PS: If you want to know EVERYTHING about the upcoming T-Shirt-Economy: Adam Fletcher, who wrote his master thesis about Threadless and is now working for Spreadshirt, maintains a great blog about t-shirts, with plenty of references to mass customization and user co-design: www.hiphipuk.co.uk

Custom Credit Cards: Mass Customization in the Banking Industry

Springwise today featured a nice new custom-banking product: Custom credit cards. Mass customization in the banking sector is one of the hottest trends in the area. Surprisingly, above much talk, not much has happened yet.

Credit cards seem to lead the industry. The idea of custom credit cards is pretty old. But in most cases, it is just an extension of the custom personal cheque, featuring your pet, grad-daughter or president (for example at www.uniquechecks.com).

Turkey-based Garanti Bank however has extended this idea. With its Flexi Cards does not only allow customers to personalize the look of their bank cards, but also to develop the entire own banking product.

"Flexi Cards are Visa cards that let the cardholder make a few key decisions, allowing them to set over ten parameters. When applying for a card, customers can manipulate variables like reward rates and types, interest rate and card fee. The rewards system is especially flexible, not only letting customers determine reward ratio and type (cash or points), but also enabling them to choose which payments will earn them extra rewards: whether it are broad categories like restaurants, or specific stores like Zara.

Interest rate, bonus rate and card fees are selected by sliding bars that render various combinations of rates and fees. Card fees, for example, can be pushed back to zero by committing to a monthly spending minimum. A lower interest rate leads to a lower bonus rate, etc. Lastly, after making serious decisions about financial terms, customers can design their own card, choosing from different colors and a gallery of images, or uploading their own image. There's even the option of picking a vertical card, which is a world's first for Visa."

A very similar idea (based on a Mastercard) was introduced already in 2002 by the UK company Royal and Sun Alliance. Their MORE THAN credit card also provided their customers the opportunity to create their ideal credit card. Customers could choose their own APR, cashback, servicing options and annual fee to suit their needs as they change over time. I have featured this example since years in my presentations, but just had to learn that the company stopped this offering. Reasons unknown.

But the concept itself promises many opportunities:

"While customers appreciate being in control and creating a tailor-made card, inside and out, the bank is able to test various value propositions, gaining valuable insights into which customer segments choose which options. Self-segmentation through ultra-personalization. ;-)"

I couldn't say it better than the guys at Springwise! If you know interesting other concepts of mass customization in banking, let me know!

MC&OI Interview: Jan-Christoph Goetze from Personalnovel about custom love stories, on-demand printing and how his business just democratized an idea from the 15th century

Here is number two of my new series of interviews with pioneers from the mass customization community (to the first interview). Jan-Christoph Goetze is founder and CEO of PersonalNOVEL, a German mass customization site that allows its customers to create a truly individual book: One in which they and their friends or loved ones are the main actors. On its website Personalnovel.de, the company offers a wide selection of titles, ranging from Romance Novels, Adventure, Mystery, Sci-Fi to Detective stories.

Personalization is possible for the leading characters, their physical appearance in terms of hair color, eye color and, in the more intimate romance novels, also their perfume and pet names. A personal dedication and a variety of additional attributes, depending on the book, as cars, ships, friends, villains and places contribute to a unique experience. Using latest digital print-on-demand technology, the books are produced by an external partner in paperback, hardcover or even leather cover. Additional features are individualized covers and titles.

Before moving into custom publishing and founding PersonalNOVEL in 2003, Mr. Goetze worked as an architect with Murphy/Jahn in Chicago, Il, Berlin and Munich, after finishing his Master of Architecture at Cornell University, Ihaca, NY.

Mr. Goetze, how did you develop the idea to launch PersonalNovel? Was this your first encounter with mass customization?

Based on several observations, the idea of creating PersonalNOVEL was driven by the goal to let everyone become the star of a book. Another approach was to stress the limits of digital printing and the opportunity to create industrially produced individual copies in volumes of just one book. Exploring the technical limits was also my first encounter with mass customization -- and apparently a lasting one.

Can you describe briefly the process how your books are developed, configured, and produced?

All our featured books are written exclusively for PersonalNOVEL. We developed a guideline how the text is written to have a good balance of personalized and not personalized content. Our authors come from a wide array of backgrounds and have mostly published with other houses as well.

The submitted text will be formatted, proofread and fed into our specifically developed software which allows us to format the books the way the customer has ordered it. The software itself is not only restricted to generating text, but also features our customer relationship management.

Once customers have chosen a title from our vast selection, they enter the questionnaire containing names, characters and so on. While they enter their information, they can read the resulting personalized text in real time. The next remaining five steps allow our customers to configure the book with features like a personal dedication, fonts and binding or cover options.

Our associated print shop prints the formatted books on digital printing equipment every weekday. Paperback books are usually shipped the next day, hardcover and linen books three days later.

What are the achievements with PersonalNovel you are most proud of?

The most exciting aspect about PersonalNOVEL is the high level of customer satisfaction. People seem to be extremely thrilled by reading their name in a completely customized story.
At this point we created a good base of customers, we are providing a reliable and quick customer support, it is fairly easy to generate a book and our quality in content and output is improving more and more – so PersonalNOVEL has become a wonderful source for personalized books.

Due to our good reputation [and a press coverage that should envy every PR manager; FTP] big publishing houses are approaching us. We just signed the first contract with one and are discussing new projects with others.

What are the reasons of your customers to purchase a personalized book? Do you think there are limits of your business due to a novelty effect, meaning that once the idea of a personalized novel is known in the market, the appeal of this product will diminish?

PersonalNOVEL’s books are mainly used as gifts and it is an interesting question what limits our product is facing. I don’t think it has any appeal to the mass market, because it takes quite some effort to generate your own book. PersonalNOVEL might take advantage of a certain novelty effect but I assume we will always have a certain group of customers enjoying the idea.

Are there any other good examples of mass customization in the publishing industry?
And do you see any upcoming trends with regard to new players, technologies, markets, etc. of mass customization in the publishing industry?

Maybe personalized mailings, calendars or postcards as the basic predecessors; but quite frankly I couldn’t think of any, since there aren’t too many applications around anyway.
Since we are currently developing a few new ideas which also might become real products I am sorry to pass on this one. Interesting samples for customized products are the printed versions of Wikipedia or a customized travel guide book.

Why do we have not more customization of books, journals or newspaper yet? It seems to me that, from a technology point of view, this industry is far ahead of others. What prevents companies to exploit the capabilities of digital printing for more customization?

I make a distinction between personalization and mass customization in the publishing industry. Customization configures data according to the profile of the customer, like a Wikipedia encyclopedia about medieval history or a guide book limited to restaurants in Tuscany, both chosen from list of article components in a database. Personalization means to incorporate the customer into the content itself. That’s the reason why a personalized journal or newspaper contradicts its name.

Mass customized print products, weather books or newspapers, share the fate of being produced in small volumes and are rather expensive compared to usual products. Their value to customer is that they fit their customers' interest, while a PersonalNOVEL stars the customer himself.

Another reason could be that for reading newspapers and journals, one might enjoy the wide array of topics being offered compared to a customized product which limits a reader to her selection.

In addition, Publishers that want to offer personalization face a barrier of entry: Their current distribution is limited to bookstores (on- and offline) and they do not have neither customer support nor customer interaction which is crucial in this business. So a publisher would have to enter a new market which is not his core business -- and that’s why he is better advised to work with specialists like our company.

To conclude: What is, in general and beyond your industry, the greatest mass customization offering ever – either one that is already existing or that you would like to get in the future?

If we turn back the pages a couple of centuries we encounter the roots of mass customization: manufacturing and handcrafting. In the old days everything like shoes and shirts were produced by hand and therefore unique. When Gutenberg invented the book press in the 15th century many books, especially bibles and other religious prints, got personalized covers accustomed to their owners like kings, lords and so on. So even 500 years ago a very limited number of people could enjoy customized and personalized books. Our achievement is that today everybody can afford a PersonalNOVEL.

Contact Jan-Christoph Goetze at info@personalnovel.de.

This is so long tail: Newly Launched ZAFU.com Helps Women With Personalized Jeans Recommendations to Find their Perfect Jeans

Personalization as a more scalable alternative to mass customization?

Many women I know share this experience: Looking frustrated at thousands of jeans listed on a search engine, or carrying a pile of denim into a changing room – just still to find not the jean that really fits. ZAFU.com. a new venture by Archetype-Solution's Rob Holloway, wants to provide help – and is the perfect example of an application riding the long tail.

Remember (see post from July 28) that the idea of the now bestselling "The Long Tail" book by Chris Anderson is that today there are (a) unlimited choice and variety, (b) more consumers that want to utilize this variety to find a better fitting product, (c) large profit opportunities for companies not focusing on a few large blockbusters or hit products but on helping customer to explore this variety.

Anderson's book focused on long-tail-applications in the digital sphere, music, books, and movies. But zafu.com brings this into the world of apparel.

CNN described in a press coverage Zafu's concept quite well:

"Sizing jeans to the myriad shapes of women is a challenge even in a department store dressing room, let alone online. Zafu.com, launched this week, arrives as the industry shifts from years of marketing baggy or flare-cut jeans to a skinny silhouette that is much harder to size and wear. "We've taken the trouble to actually measure and check the jean and try it on people to see how it really fits," Chief Executive Rob Holloway told Reuters. "We are the friend in the dressing room, I guess."

Zafu asks women shoppers 11 questions about how they prefer jeans to sit on their hips or waist to create a body profile. That alone is a departure from the incongruous body-type descriptions of "pears" or "triangles" found in fashion magazines and retail catalogues.

The results are used to match the user with as many jeans as could suit them from a database of hundreds of styles, from broadly marketed Gap to pricey Seven, then link them to a retailer to purchase."

In a recent phone conversation with Rob Holloway, he described the laborious process it took them to set up this fit database. They invited hundreds of women in their offices, each woman hat to try on 32 different jeans, all fits being evaluated by the company's own apparel experts. This gave them both information about women's shapes and figures and information about the cuts and fitting secrets of dozens of different jeans brands. To update this information, Zafu has created a streamlined process so that new models can easily being integrated into their database and assortment.

Correct sizing is one of the biggest obstacles to the growth of online apparel and footwear sales, which are expected to rise in the US to $13.8 billion this year from $11.3 billion a year ago, according to tracking firm Shop.org data. Almost 14 billion sounds a lot, but is only 6 percent of total U.S. apparel and related sales.

The jeans market is an interesting market segment. Market research firm NPD Group reports women's jeans sales reached $7.8 billion for the 12 months through March 2006 -- a 10.8% increase over the $7.04 billion reported during the same period a year ago. This data is on top of a 13.7% growth rate of jean sales between 2004-2005. Much of this growth comes from new jeans models and niche designer brands – offering more choice and options, but making the entire selection process also more difficult for women to navigate.

CNN quotes Ellen Tolley Davis of Shop.org saying "Many consumers still want to touch and feel merchandise before they buy it. When it comes down to particular sizing for shirts and pants, there's still some room for retailers to make improvements."

This is exactly what Zafu does. They also provide a service that you will get not from many retail associates: Zafu's web site will tell you also when there is NO jean at all in their assortment to fit your body – asking you to postpone your purchase.

Zafu will tell the consumer outright and suggest she check in periodically as styles are updated. "We wondered, should we be completely honest here and show someone zero [results] or fiddle a bit," said Holloway.

They decided to be honest – and this is exactly where the value of such an intermediary comes from. But according to their estimations, their assortment of analyzed and databased jeans is already large enough to provide an exact fitting jean for 94% of all consumers. And loosing this 6% of sales (theoretical) is a good price to pay to show to the other users that they are really serious and honest about fit! Early users of the service seem to love it a lot, as this customer review suggests.

Zafu also allows women to save their profile making the process even easier next time they return. This helps them also to inform customers when a new jean is added to their assortment that exactly fits their body style. However, if a user does not want to leave any data, she does not have to do register etc.

And how does Zafu make money?

First, there are provisions for each sale. Zafu does not carry any inventory, but directs customers directly to the web sites of affiliated retailers and gets the usual commissions between 5-20% of each sale.

Second, they will provide in-house fit recommendation services to online and offline retailers, helping the customers of just one brand to navigate the assortment in a store or online shop better.

Third, I believe there is a lot of potential to extend the service to other product categories, becoming the one-stop style adviser for women with regard to fit. This could also provide some nice aggregated market research data, another potential source of revenue. For this, a cooperation between My Virtual Model and Zafu would be a perfect option.

For me Zafu is also an interesting business model as it provides another alternative to real mass customization. Zafu's parent company, Archetype, launched in 2003 a fit consulting business that provides mass customization services to some of the leading apparel retailers and brands in the US, including Land's End's Mass Customization business.

Zafu's personalization service is an alternative model. It may not have the inventory advantages and value prepositions of mass customization, but provides a much more easy to implement and much better scalable system. The future will show where there is more value for customers. I believe that both models will work hand in hand and supplement each other: For most consumers, a better matching service as zafu.com will provide sufficient value. For others, however, the ultimate product will still be the truly custom jean -- providing not only perfect fit, but also all the hedonic satisfaction connected with a custom product.

Updates: "Customized online fashion finally clicks with consumers": A journalist tests zafu.com (and competitor myshape.com) [Thanks to madeforeone.com for this link]

Report on Internet-Retailer (Nov 7, 2006): Shopping.com, a large shopping portal, has partnered with zafu.com to launch a women’s jeans finder on the shopping engine. The new feature, accessible under a link from women’s clothing category pages on Shopping.com, carries shoppers who click on it to a co-branded web site that guides them through the process to yield a selection of jeans and then links to the merchants where they may be purchased. The feature exposes shoppers using it on Shopping.com to brands they might not have previously known about or considered, but which might be a fit for them. “By suggesting new brands, styles and fits for shoppers, Shopping.com can offer them more relevant choices via a recommendation expressly tailored for them,” the company notes.

Update (20 Nov 2006): The New York Times had a good review of Zafu.com. on Nov 20, 2006 While the article in general praises the Zafu service, it remarks that it does not weigh heavily enough a user’s brand preference. But the label of a jeans is a as a big factor as the fit.

Mass Customization Case Study Collection -- New Issue of the Mass Customization Journal Published

A new issue (No. 4, Vol 1) of the International Journal of Mass Customization has just been published (see here for more general information). This issue is a special CASE STUDY issue containing eight cases from the International Mass Customization Case Collection, an initiative of more than 25 international researchers collaborating to build a broad basis for empirical research on mass customization. The idea of this project, coordinated by Klaus Moser at TUM, is to document current practices of mass customization businesses in a form that allows rich cross-case analysis and learning from previous experiences.

We are happy that we now can present the first eight cases of this collection in one issue, starting with three cases of mass customization of industrial goods:

* APC, a provider of data centre infrastructure from the US and Denmark,
* MarelliMotori, a manufacturer of electric motors from Italy,
* F.L.Smidth, a Denmark-based manufacturer of complex process plants for the construction industry.

Then, three case studies from the footwear industry provide the opportunity for cross-case analysis in one industry:

* Adidas, an international manufacturer of sports goods based in Germany,
* Left foot, a Finland-based worldwide operating provider of custom men’s shoes, and
* Design&MC Lab, a research lab and model plant for the mass customization of footwear based in the Italian shoemaking capital, Vigevano.

The two remaining cases focus on special objectives connected with the implementation of a mass customization strategy in business-to-consumer markets:

* Steppenwolf, one of Europe’s leading manufacturers of custom bicycles, and
* Turo Tailor, a Finnish manufacturer of apparel (men’s suits).

See here for authors and abstracts of all cases.

Full text access to the cases demands a subscription of the journal. But: Due to the cooperation with the publisher, we now can offer to all past participants of our conferences (MCPC, Deutsche MC Tagungen, IMCM, etc.) full online access to all issues for a very (really!) good price. Please contact me for more information and to get the special subscription form. Disclaimer: I am neither the publisher of this journal nor do I profit in any form from its sales or subscriptions.

Related posts on this topic:

- First issue of IJMassC published
- Special issue on Customer Centric Enterprises published

PS: We are extending this collection. If you want to contribute a mass customization case, please contact me as well (Important: Cases have to be contributed by independent scholars, not by members of the case company described!)

Consumer Created Branding: Rob Walker on Minibrand Entrepreneurs, The T-Shirt Economy and Why This Is an Alternative to Mass Customization

The NYT Magazine (July 30, 2006 issue) has an interesting cover story on ("The Brand Underground"). It provides a great insight study in the world of consumer created branding, the minibrand entrepreneurs. In great detail, NYT columnists Rob Walker draws the picture of leading-edge consumers who turn their lifestyle into business.

Trendwatching.com called these consumers minipreneurs. Their scope of activity is broad, "Some design furniture and housewares or leverage do-it-yourself-craft skills into businesses or simply convert their consumer taste into blog-enabled trend-spotting careers." Walker writes. "Some make toys, paint sneakers or open gallery like boutiques that specialize in the offerings of product-artists." All of them produce products which are a perfect illustration of the Long Tail.

Most of them also serve the need for uniqueness for the people buying them. You don't purchase (often for a large amount of money) a product from a small sub-brand because you want to look like every teenager in Urban-Outfitter clothing. This makes these minibrand entrepreneurs an interesting alternative model to mass customization: Instead of co-designing an own product, a consumer may turn to one of the minibrands to feel individual. Interestingly, the categories where minibrand entrepreneurs are most active, t-shirts and sneakers, are also two of the largest categories of mass customization in the consumer good field.

Rob Walker's main theme in the article is how corporate or anti-corporate these consumer-generated brands are. On the one hand, their founders see their brands as a "cool" way to earn a decent living. But still:

"Many of them clearly see what they are doing as not only noncorporate but also somehow anticorporate: making statements against the materialistic mainstream — but doing it with different forms of materialism. In other words, they see products and brands as viable forms of creative expression."

To look into this paradox and generate a better understanding of the minipreneurs, Walker focuses on the t-shirt economy. He quotes three trends or enabling factors that helped small t-shirt labels, which pop up in an enormous variety, to become one of the largest categories of consumer-generated brands:

"One thing that has changed since the days when they [the first sub-culture t-shirt labels of the 1980s] scrambled to make a living is that Japanese consumers have embraced certain small New York brands as something culturally significant and worth a price premium. Nigo, a Japanese designer, built a fanatical following for his A Bathing Ape brand partly because he collaborated with so many graffiti writers and others who had an aura of authenticity that impressed young, hip Japanese consumers.

The second change is technology, which has allowed production to become more accessible. (It is easier than you think for a two-person brand to work with factories overseas, using computer files and the occasional package.) The technology of the Internet has also acted as an amplifier. … There are blogs like Hypebeast and Slam X Hype dedicated to this practice, reporting dozens of new products or design collaborations from the brand underground every day.

There is a third factor: manufactured commodities have in fact become accepted as quasi art objects, and there is no more stark example than the sneaker. Hunting for unusual sneakers and modifying them with markers or different laces has been cool for decades, a phenomenon defined in Harlem and the Bronx."

While other minipreneurs may not build on the willingness-to-pay of Japanese teenagers, the two other factors are main enablers of many co-creation products as well. After reviewing the story of several user-created t-shirt labels (an world that sometimes even Walker as an expert admints not to understand totally), Walker comes to his conclusion -- and provides a great insight into the motivation of consumers to become active producers:

"If the dance between subculture and mainstream has always been more compromised than it appears and if every iteration of the bohemian idea is steadily more entrepreneurial than the last, then maybe a product-based counterculture is inevitable. Maybe subcultures are always about turning lifestyles into business — or the very similar goal of never having to grow up.

And I have to admit, the more time I spent with the minibrand entrepreneurs, the more I had to concede that what they have been up to is more complicated than simply imitating the culture they claim to be rebelling against. They believe what they are doing has meaning beyond simple commercial success. For them, there is something fully legitimate about taking the traditional sense of branding and reversing it: instead of dreaming up ideas to attach to products, they are starting with ideas and then dreaming up the products to express them."

Site note: Rob Walker has a regular column in the NY Times Magazine, where he often writes about a other great minipreneur, mass customization and customer co-creation businesses. He also has a great new blog site that should be worthwhile reading for you. This blog regularly links to his latest column, follows up on issues and ideas raised there, and "wants to advance the conversation about matters relating to what we buy and who we are": http://www.murketing.com/journal.

Collective Customer Commitment and Crowdsourcing: How Look-Zippy is bringing the Threadless model to the next level

A recent report in Business Week about our SMR paper on Threadless and Muji's strategy to use early customer commitment to reduce the new product development risk brought us some good feedback and comments on the concept (see the updated original post ). [And of course we are just proud that after The New York Times and Der Spiegel another major publication refers to our work :-)]

Threadless uses crowdsourcing in three ways: (1) To generate new designs, (2) to evaluate submitted designs, and (3) to sell its products via an affiliate marketing system and social network.

But the market is already progressing faster. As you may already have read in other blogs, Spreadshirt, the German T-Shirt Customizer working like Zazzle or Cafepress, just announced a take-over of LaFraise, the French Threadless clone. This will provide Spreadshirt the ability to integrate its users even further in the design process and to supplement its highly flexible, but expensive on-demand printing concept with the business model of screening demand before (mass) production. I am curious to see which innovative business models will be resulting from this merger.

Another company however has already brought the Threadless concept to the next level: Look-Zippy, a Sénergues, France, based t-shirt seller (thanks to Jochen Krisch for the link).

Remember that the key aspect of Threadless' model is the aggregation of commitment of its customers. Threadless does not face the conventional risk of a fashion company whether new design variants will become a hit or miss. This risk is reduced tremendously by the participation of its customer community in the assortment planning process.

The evaluation of new designs by its customers helps Threadless to pick exactly those new designs which find the highest appeal in its community. On top, customers express their informal commitment to purchase a design variant in case it would be selected and printed by ticking a small box. While this works very well, some uncertainty remains for Threadless: Exactly how many t-shirts they shall print, and in which size dispersion. This decision can be only based on forecasting and rule-of-thumb guessing.

Even if t-shirts are a product with high margins and low inventory-cost, the "special sales" periods at Threadless indicate that there are some overstocks of t-shirts which do not sell as well as the customer evaluation predicted, or where Threadless' management ordered too many of the wrong sizes.

This is where Look-Zippy has perfectioned the Threadless business model. At the beginning of the process, these French entrepreneurs crowdsource everything like Threadless: An open design competition captures the distributed creativity of creative users, and the selection of the best designs builds on the evaluation capability of the entire community.

But then the process differs: Instead of scheduling the winning designs immediately for production, Look-Zippy starts selling first by taking binding orders. Selected new designs are listed for exactly two weeks on the web site (a ticker prominently shows the remaining time – Woot.com pioneered this strategy online). Customers can place an order only during this period, once the time is up, no more orders are possible -- and only then production starts.

The result: The shirts are produced in exactly the right volume and size dispersion. This binding commitment of customers allows Look-Zippy to mass produce only the products that really fit their customers' needs – a marketer's dream. This model is much closer to the original model of collective customer commitment which was developed by Elephant Design and Muji in Japan at the end of the 1990s (more info on Muji): The risk of new product development and planning is outsourced to the customers.

The disadvantage for customers of this model however is a slightly longer waiting time/ But this may be counterbalanced by the "limited edition" feeling of the shirts. Also prices should remain low on the long run, as an successful product has not to cover the wrong forecasting of other variants.

Combining the creative talents of the crowd (open innovation), the commitment of a community for a new product (collective customer commitment method), and the limited edition approach of consumer markteters seems like a winning strategy for other industries as well. I am curious to see in which other consumer good industries this model will catch up first. Please leave a comment or e-mail me if you have any candidates or examples!

Personalization and Music: Beyond shuffling on your Ipod -- an overview of new services to customize your music experience

What we can learn from the BBC, Pandora, and Musiclens for mass customization

The traditional compilation CD is deader then ever. Instead of listening to all songs of an entire CD, most consumers today prefer just to listen to what they want on their MP3 players (a typical long tail phenomenon). But selecting, filling and arranging the playlists of these players have stayed more or less a craft business. While some persons feel joy and achievement once they have generated their very own, individual playlist, this is, none the less, plenty of work. Also, listeners are restricted to the music they known (and, more or less, own).

Sure, with satellite radio, there are now highly focused radio stations which substitute general radio broadcasts. But often, even these stations are still a bit too broad and contain songs that you don't really like too much – and too few of your real favorites.

Here, three new services provide help. Using different approaches, they allow users to customize their music experience beyond the restrictions of ownership, information about favorite songs, and the demand to manually craft a custom playlist. These services provide tools to find new music matching an individual's preferences, but also enable custom broadcasting services of a new level.

Note: I am not talking here about the option of customizing the particular song. While there are some new promising offers (e.g., at http://www.dabreakupsong.com you can create a custom rap song to break up with your partner :-), this is a minor field of application (see my posting on this subject). Most people don't want to customize their music on the level of the single song, but they want to personalize the stream of songs they listen.

BBC to Develop Personalized Radio Service

Madeforone recently reported about a new personalized radio service that the BBC is developing. The UK state broadcaster wants to allow audiences to create personal radio stations from its content, its director general has said. The service, provisionally called MyBBCRadio, aims to give audiences more control by combining existing services such as podcasts and the BBC Radio Player. It will be part of the BBC’s iPlayer, a new interface device that shall transport custom content (music, video, reportings) to each user.

With its earlier Backstage offering, the BBC has been a forerunner of user-generated content. It changed its policy from protecting its content to giving most of it away to listeners for free, allowing users to create new works by mixing their own stuff with BBC programming (more information here). NNC Backstage, however, was more an offering for leading-edge users or music lovers. But the new MyBBC Radio Service wants to bring this capability to the mainstream.

Radio 2.0: Pandora and the Music Genome Project

But personalized radio stations do already exist. Once of the best services is Pandora, a music discovery service designed to help users find and enjoy music that they like. Based on a huge database that has categorized songs of over 10,000 different artists based on unique attributes, it helps users to find music that has the same characteristics of a song or artist they like. Just type in a name of a favorite song or artist, and let the magic begin. I was highly fascinated by the quality and scope of the resulting personalized music stream (you need an US ZIP code to use this service, if you live abroad, just use 02138, my postal code).

Pandora has a totally different approach to configuration compared to the majority of other configuration toolkits. It is a good example of a need-based system, i.e. an expert system that does not demand that users can describe exactly what they want, but that just analyses what they like and provides suggestions based on this analysis.

The service is powered by the Music Genome Project. In this project, founded by Tim Westergren in January 2000, a group of musicians and music-loving technologists came together with the idea of creating a comprehensive analysis of music. They assembled hundreds of musical attributes or "genes" into a very large "music genome". Taken together these genes capture the unique and musical identity of a song -- everything from melody, harmony and rhythm, to instrumentation, orchestration, arrangement, lyrics, singing, and vocal harmony.

This kind of expert analysis of all songs provides the main difference of Pandora to other music recommendation systems based on collaborative filtering (as, e.g., at Amazon.com). Collaborative filtering works without any idea of the nature of the articles it is recommending, as it is solely based on comparing the usage (shopping) behavior of one user with the behavior of other users. Pandora, on the other hand, is not based on such a analysis, but solely on the nature of the products (songs) it recommends.

Pandora is offered for free in an advertising supported version (and of course the company hopes to get a provision when you buy a song you discovered though its service). There is also a subscription based service without advertising. All music is streamed, this means it is not possible to download or safe the stream (legally). With a special device, you can also listen to your very personal music channel without your computer.

More information and analysis: http://blog.pandora.com/press/

MusicLens: Configure Your Music

Now compare Pandora to MusicLens.de, a German project that aims to test four different technologies to analyze music like it has been done in the Music Genome Project. However, this service opens the Pandora box and allows you to really configure the music you like. Using more than 10 sliders, you can describe exactly the music you want to hear, like its tempo or subjective volume. You can also define the purpose of the music on a scale from listening over driving and sex to dance. And set the mood of the song (on a scale from smile to angry).

As a result, you get a play list with songs matching your desires. Sounds too complicated? You also can just provide a favorite song for the start, see its characteristics, modify them just a bit, and get new music. As this is a test project, however, the music available does not match the scale and scope of Pandora's repertoire. But the web site provides already a good indication of the service.

MusicLens uses a fuzzy search technology to find music - CDs, albums, song titles or artists - by characteristics. Searches can be carried out in large masses of data quickly and effectively. And, despite the terms of the enquiry being vague or indefinite, the results are clear. The idea is to provide users also good results when they do not know what they are looking for – a feature conventional search engines do not have. Users also do not need to use specific search vocabulary or any form of literal definitions. The search is conducted by way of various characteristics or categories, represented by the slider navigation system.

DDD-Systems, a Hamburg based IT services company that is behind MusicLens, hopes to position the system also as a business-to-business service. The search technology shall assist those involved in purchasing film, radio or television content to find the right content.

Beyond segments and clusters

Why do I write about all this? In my opinion, MyBBCRadio, Pandora, and MusicLens provide some great general insights for mass customization:

-- These services overcome the traditional categorizations (market segmentations) of music in genres. There are no clusters of "Independent", "Pop", or "Rock" music. All categorization is based on an individual user's preferences and desires.

-- Pandora and MusicLens apply modern search technologies which support a need-based configuration approach. Instead of today's dominating parameter-based configuration approach (users configure products based on concrete selections of components and modules), they help to define products based on a description of the user's needs and preferences.

-- They address the customization of services. Up to today (and also in this blog), mass customization is often solely discussed in relation to the individualization of physical products. MyBBCRadio, Pandora, and MusicLens are great examples of mass customization of service offerings.

But for now: Enough words, now go ahead and listen to your personal music.

Buyers of custom products are a most desirable customer segment, a new Forrester Report finds

In the Exciting Commerce Blog, I today found a link to a new Forrester report by Carrie A. Johnson, addressing the old question "why consumers buy custom products" and who these users are. Her conclusion why manufacturers or retailers should serve these users with customized products despite the rather high costs of implementing mass customization: "It provides a new channel for manufacturers to reach out to buyers directly, and an opportunity to fine-tune their product mix based on direct observations of consumer behavior — consumers who are opinion leaders with greater than average influence."

Internet Retailer has some more information on this report (249 USD):

"Customers who design and purchase custom consumer products online tend to have more online experience and are tech friendly: 83% of custom purchasers have been online for five or more years, Forrester found. That compares with 66% of all online consumers. In addition, more than half of custom product purchasers have e-commerce tenure of five or more years, twice the rate of all online consumers.

Forrester also found that more than half of custom product buyers have a college degree or higher, compared with just 38% of all online consumers. Purchasers also have higher income levels, with 41% having household incomes of more than $75,000 a year, compared with 23% of all online consumers. Custom product purchasers also are more likely to be male.

Customer product buyers also are more likely to use multiple channels when shopping, according to the report. 42% like to research online and purchase offline, compared with 36% of online shoppers.

In addition, 54% of custom product buyers consider themselves natural leaders, versus 35% of all online consumers, and 18% consider themselves trendsetters, compared to 11% of all shoppers. “These beliefs carry over into action, with [custom product] buyers more likely to tell others about products that interest them and e-mail products that interest them to others,” Forrester said.

The study also found that the major concern for consumers wanting to buy products they build online is not being able to return a custom-designed product. Only 19% said they are unwilling to pay more for a custom product, and only 8% said they are concerned about credit card security for online purchases. “To make consumers feel comfortable with the process, allow them to return or exchange products they buy and make it clear that they have recourse if they have a change of the heart,” Forrester said. Greeting cards, jewelry, linens/home décor, apparel, footwear and accessories were the most popular items to customize online, Forrester found. "

Open Source Footwear -- bringing customer co-design to a traditional industry

How the EU-funded CEC project wants to foster customer co-design in the footwear industry -- and why star designer John Fluevog is already doing it.

When people talk about open innovation, in most case it is related to high tech or science products as in the case of Innocentive, or software as with open source software. Then you have hip youth products like T-shirts, as in the case of Threadless' user innovation model [Threadless seems to be omni-present in the press and blog world today (I introduced Threadless in in this blog in August 2005; see for some updates on Threadless Business 2.0, Exciting Commerce, Crowdsouring, Innovation Lab DK, and of course at Threadless themselves).

But can the open source / user innovation idea also work with rather conventional products like, say, shoes? No high-tech sports shoes (see here for a recent paper on user innovation at Adidas, working paper version here), but good ol' dress shoes?

This is one of the issues Angelika Bullinger wants to find out as part of the "CEC-made shoes" project, a large integrated project funded by the European Community (PDF with project info) to modernize the European footwear sector. Angelika, who is a colleague at our TUM Research Group on Customer-Driven Value Creation (my permanent academic home besides my present residency at MIT), explores with researchers from Fraunhofer IAO and other institutions how footwear companies can become more competitive by fostering user innovation in this industry.

One way to do so is to install internet platforms (innovation toolkits) where users can evaluate new designs, give feedback or even create totally new designs. Given that shoes are one of the most common products we use, and also a very emotional one, I believe that there is a lot of potential to do so (mass customization, another concept that is also evaluated in the CEC project, is already getting more common in the footwear industry industry).

And some innovative shoe companies are already doing it: William C. Taylor reports in the New York Times today how Canadian shoe designer John Fluevog, one of the stars of his profession (loyal customers call themselves ''Fluevogers"), has been soliciting ideas from its customers -- encouraging brand enthusiasts to submit their own sketches for leather boots, high-heeled dress shoes, even sneakers with flair. He posts the submissions on his company's Web site, invites visitors to vote for their favorites and manufactures and sells the most promising designs.

''Customers want to express themselves, to be involved with the brand,'' Mr. Fluevog is quoted in the article. ''For so long, people would hand me a drawing of their personal design for a shoe or ask if I had considered an idea they liked. This program is a natural outgrowth of that desire for connection.''

As the NYT reports, until today the company has chosen nearly 300 finalists from the flow of sketches into its headquarters -- and introduced ten shoes based on customer designs, including the Urban Angel Traffic, a walking shoe (retail price, $179) designed by a customer in Moscow, and the Fellowship Hi Merrilee, a vintage-style pump ($189) designed by a customer in Provo, Utah.

Introducing customers in footwear design may have its limits: ''Some of the ideas from customers are striking, but impossible to make,'' Mr. Fluevog sayz in the article. What tends to work best, he explained, are intriguing twists on design themes that he and his colleagues are already exploring. ''But even submissions we can't make add to the stimulation,'' he added. ''Our customers get more involved, and we get insights into who they are and what they're doing. It's better for both of us.''

This is exactly where we want to extend the user innovation process with the research we do for the CEC project. Instead of asking consumers for sketches with a very wide solution space, sometimes representing impossible designs, the idea of an internet based toolkit for user innovation is that customers are guided and are designing within the capabilities of a specific company.

Eric von Hippel, head of the innovation and entrepreneurship group at the MIT Sloan School of Management, has described this method for more high tech goods like semiconductors, food flavors, or plastics, before:

"In a time of ever more talented technology enthusiasts, hobbyists and do-it-yourselfers, all connected by Internet-enabled communication," he is quoted in the same NYT article, "the most intensely engaged users of a product often find new ways to enhance it long before its manufacturer does. Thus, companies that aspire to stand out in fast-moving markets would be wise to invite their smartest users into the product design process."

''It's getting cheaper and cheaper for users to innovate on their own,'' Professor von Hippel said. ''This is not traditional market research -- asking customers what they want. This is identifying what your most advanced users are already doing and understanding what their innovations mean for the future of your business.''

The fact that a successful designer like John Fluevog is thinking this way now as well is very promising – as it are often the internal designers or engineers of a manufacturer who oppose the idea that users and customers can be a source for innovation as well.

It will take for the very conservative European footwear industry some more years to think in such a way – judged by my experience from working with this industry (see my earlier comments on the slow adoption of mass customization there). Hopefully their customers, support by some clever Asian manufacturers, have not pushed them out of business until them. But we hope to contribute a bit with the CEC project that this will not happen.

I will keep you posted on the outcomes and progress in this research project. If you are from the footwear industry and want to explore user innovation (or are already doing so), let us know! We are permanently looking for further exploration partners from this industry.

Kraft Foods Crowdsources its Innovation Process to its Customer

Procter&Gamble recently got much publicity about its open innovation strategy. Now also Kraft Foods, a competitor in some markets, announced its new source of inspiration for new ideas: its customers, as the Wall Street Journal reports today.

Kraft is the largest food company in the US. Like many large packed goods retailers, it was pretty much disconnected from its individual customers for a long time (although the company did a number of pilots in mass customization, namely custom Kraft Lunchables, lunch boxes for kids). But for innovation, the old thinking ruled: We know what customers want.

Of course, like all other consumer goods companies, Kraft has an open line to its customers, toll free numbers where customers can call with questions, complains – or ideas for new products or improvements. In the past, however, nothing happened with this input. The WSJ quotes Mary Kay Haben, Senior Vice President for Open Innovation (sic!) at the company, "we would have said, `Thank you, but we're not accepting ideas.' "

This has changed now with the launch of a new consumer web site where everyone can submit ideas for new products, processes, advertising or whatever. Kraft in the moment is in the desperate move to re-invent itself. While the company owns some of the best known brands, including Oreo cookies, Philadelphia Cheese, Milka chocolate, and Jell-o, it has struggled in the last years to generate the profits it used to have in the past.

And like many companies, after a first stage of heavy cost cutting, Kraft is now focusing on innovation. And realizes that it will miss too many opportunities by just relying on its internal resources. So it is turning outwards, starting first to engage professional solution providers from its periphery. The first effort to open its innovation process was designed to swap ideas with outside partners, even competitors, to improve products, packaging and business systems. Open Innovation, in this understanding, has wide parameters and includes licensing deals and new technology. For example, Kraft today is one of the clients of Innocentive, a company that helps solution seekers to broadcast problems to its network of 90,000 solvers around the world (see here or here for a report on Innocentive).

As Promo Magazine reports, this kind of cooperation is nothing new per-se for Kraft. In marketing, partnering with other brands to establish new product categories has been established since a long time (for example, Kraft has a license from Starbucks for its coffee products, and, well, one of Taco Bells for Mexican Food). But the open innovation strategy should bring this to a new level.

"We rely on our own R&D folks for their ideas, but also are looking outside our own walls, like Procter & Gamble does. Kraft New Product Development will continue to focus on organic growth and product extensions, while Open Innovation will primarily focus externally.", the magazine quotes a company spokesman.

The latest step in open innovation of Kraft is opening its company walls to its largest resource base: its customers and users of its products. A new (still pretty basic) web site facilitates the submission of ideas. There is also a nice phone number (credits to Kraft to get this vanity number): 1-800-OPN IDEA.

Their web site (http://www.kraftfoods.com/innovatewithkraft) is an example for a simple toolkit for customer idea competitions, a method for new product development that I have described with my co-author Dominik Walcher in a recent paper (published, by the way, in a great special issue of R&D Management, an academic journal, on open innovation; you find a pre-version of our paper also on userinnovation.mit.edu).

But before you can submit your idea, you have to accept a long list of rules. Quite annoying, as also the folks at Kraft have realized:

"At Kraft, our Innovations Team welcomes new ideas, and sincerely hopes that you choose to share your ideas with us. That said, we want to make sure you fully understand Kraft’s process and rules about receiving such ideas. While we understand that these rules might appear strict, they are necessary to protect both you and Kraft. Therefore, we ask you to carefully review all the information provided below and only send us your idea if you are comfortable with our rules."

(Note: If you take open innovation seriously at your company, engage a professional agency for the copy texts, as you do it with all your advertising materials).

And what are they looking for?

"Kraft is accepting ideas under this policy for new products, packaging, and business / processes / systems only. We are most interested in ideas that are more that a concept, in particular new products & packages that are ready to be brought to market (or can be brought to market quickly)."

An existing patent of the information provider is a plus in this regard. When the idea is protected — or protectible — by a patent or copyright, they may negotiate with the provider appropriate license rights. If Kraft is interested in an idea that it is not protected (or protectible) by a patent or copyright, but new to Kraft, the company may grant a nominal award. But: "In no case will that nominal award exceed $5000."

So you better speak to your patent lawyer before contacting Kraft! And in case you are reading this posting and want to submit your bright idea (I am just dreaming of Instant Sushi), you better are a resident of the United States: Even if Kraft opens its innovation process, its openness end at the borders of the US. Only US residents can submit ideas.

But what can we expect. While the web site may look simple and the rules restrictive, this is the very first attempt of a company, that was internally focused for its entire existence, to open its boundaries for input from its periphery. It took Kraft many decades to get its internal innovation management organized and optimized. It will also take them a wile to experiment and learn by trial-and-error to create a proper infrastructure and organizational framework for open innovation with their customers and users. But it is great that they have started.

Threadless.com – when mass customization meets user innovation meets online communities (Updated)

(Update of the original post from August 2005) Threadless.com is a young Chicago-based fashion company that follows an innovative business model mixing customization with new ways of customer interaction to create high variety products without risks. Started in 2000 by Jake Nickell and Jacob DeHart, Threadless.com focuses on a hot fashion item, t-shirts with colorful custom graphics. All products sold by Threadless.com are created by some if its users and inspected and approved by user consensus of the entire community before any larger investment is made in a new product. Customers evaluate potential new designs before the production process starts. Top-rated submissions are transferred into final products and produced in limited editions (their creators get $2000 as reward, and their name is printed on the particular t-shirt’s label).

Since its launch, over 400 winning designs have been chosen for print from more than 40,000 submissions. The company builds on a large pool of talent and ideas to get new designs (much larger than it could pay if the design process would have been internalized), enabling it to identify new trends early and transfer those into a product design. The Threadless community is thriving with over 300,000 users signed up to score designs (in 2005, an average of 1,500 new users were signing up per week).

Compare this idea to traditional customization: Instead of investing in highly flexible manufacturing systems and dealing with individual custom designs, the company focuses its energy to draw creative designers to submit new designs, and to facilitate the evaluation and voting process by its customer community. The often costly elicitation process of a mass customization system is substituted by the pre-order taking and a voting mechanism of a large number of customers.

Instead of customizing individual products, Threadless.com has a system of “custom mass production”, building on the early involvement of some (expert) customers in the development process of new product designs and the refinement of their ideas by a larger customer groups (this idea has been described already in 1998 by G. Elofson and W. Robinson in a paper for Comm. of the ACM, but has never took off in practice).

Motivated by its success in the young fashion market, the founders of the company have recently extended their categories to formal wear like ties or polo shirts (http://NakedandAngry.com) or music (http://15MegsofFame.com). It will be interesting to see how sustainable this business idea is. In the moment, it is highly successful and a very interesting alternative to conventional mass customization.

More information:

In a recent paper with Susumu Ogawa, we looked into more detail on the Threadless model. The paper has been published in MIT Sloan Management Review, Issue Winter (January) 2006, pp. 65-71. Abstract & Download here.

In a second paper, Petra Schubert, Michael Koch, Kathrin Moeslein and I comment on the possibilities how communities can support customer co-design: Journal of Computer-Mediated Communication, Vol. 10 (2005) 4 (August).
[http://jcmc.indiana.edu/vol10/issue4/piller.html]

Recent good posts on Threadless with more information can be found here:
Business 2.0,
Exciting Commerce,
Crowdsouring,
Innovation Lab DK,
a good interview with jacke Nickell
and of course at Threadless themselves.