Mass Customization & Open Innovation News

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.

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,

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.

Shoe Individualizer Selve Wins Retail Week's Product Innovation of the Year Award 2006

But European Footwear Manufacturers Seem Not to Care

"Mass Customization rules", the blog Exciting eCommerce recently commented on this year's nominations for the Webby Awards 2006, the leading international award honoring excellence in web design, usability and functionality, established in 1996. Three (of five) 2006 award nomination in the important retail category go to mass customization solutions: Sport brands O´Neill and Reebok for their online sneaker configurators and to Sherwin-Williams, a really well done configurator for home paints [Update: this site finally won teh award in this category!].

But also in the offline world, mass customization is a winning strategy. Selve, the Munich and London based provider of custom women's footwear, just won the prestigious U.K. "Product Innovation of the Year" Award by Retail Week. This is a further recognition of the excellence and pioneering work Claudia Kieserling and her U.K. partner Karen Macintyre are doing in this industry.

Selve has been the first company offering fully customized shoes for women in an affordable price range (180-250 Euro). Launched in Germany in 2001 and in the U.K. in 2004, Selve shoes are truly made-to-order in an Italian factory. Women can select colors, style options, heel heights, and more, and of course each shoe is perfectly fitted to the exact measurements of each foot. Recently, Selve also introduced a line of men's shoes in its Munich store.

It is surprising to see that not more footwear manufacturers are moving on this model. While there are several good footwear brands offering custom men's shoes, Selve is still the only company helping women to find the perfect fit. Market research conducted by the European Community, however, has shown that the market potential for women's custom footwear would be much larger. And with companies like Corpus-e, there are today also very affordable scanning solutions available to support 3D measurement (Corpus's scanners are much beyond the traditional 20,000 USD price tag of a conventional foot scanner). In addition, projects like the Euroshoe or CEC-made Shoe have provided all the necessary research and technology to produce custom footwear with mass production efficiency.

Still, the industry is not really reacting on the trend (contrarily to the sports good industry, where today EVERY large brand is offering mass customization). In the last year, more small Italian and Spanish footwear manufacturer went out of business than ever before. They can't compete with Asian manufacturers on standard shoes. But what I do not understand is that almost none of them are becoming entrepreneurs and provide mass customization capacity.

Selve and the few other existing brands are desperately looking for more reliable manufacturing capacity, their customers are waiting for days (in the London store) just to get an appointment to purchase shoes (there is no talk about price competition)! The market is there, but manufacturing seems not to care about. Due to lack of industry support, also the EuroShoe Factory is not really winning pace.

Hopefully the Retail Week Award and other recognitions will slowly change the conservative mindset of the remaining European manufacturers – before they are all dead and replaced by Asian competitors (which, by the way, are very happy to manufacturer custom products).

Full disclosure: I am on the board of directors of Corpus-e, and conducted joint contract research with Selve before.

Pimp Your Play: Mattel Hot Wheels Custom Kiosk Cars at FAO Schwarz Store in New York

Mass customization in the toy market is an often quoted but still not really broadly implemented idea. Sure, there was Mattel's famous custom Barbie (great online configurator, but they stopped the custom manufacturing after a couple of years due to supply chain problems – and perhaps this was just logical when the most important feature of girls customizing their doll is the doll's name – for this you don't need a custom manufacturing system). Then we of course have Build-a-Bear, one of the largest mass customization success stories. And Lego Factory, the most serious toy customization application I know until today.

But now, at the FAO Schwarz toy store in Manhattan, there’s an automotive assembly line manned by an ever-changing group of eight-year-olds. The new WIRED 3/06 has a small piece about a Kiosk system in this store where kids can customize the toy cars at the "Mattel Hot Wheels Custom Car Factory Kiosk". Long name, nice idea:

Mattel has offered a DIY-solution for toy-car-tuning since a couple of years. Using their parent's PC and the software, kids can personalize their toys on the screen and then print stickers etc to put them on their cars (see CD cover to get an idea). However, this craft solution is probably not cool enough for today's kids, and they like to go to the next level:

As KioskCom reports:

At FAO Schwarz, "Kids use an interactive kiosk, equipped with sound, lighting and a touch screen. Kids choose a car design. Within the Factory is a station manned by two employees who fill orders from a stock of Hot Wheels toys representing all the combinations available. Once the custom order is found, it’s placed in a custom laser printer where the child’s name and unique registration number are applied. Then the collectible car, along with a certificate of authenticity, is presented through the kiosk. The whole thing costs $20, about four times what a basic Hot Wheels car costs off the shelf. During the assembly, the child sees a three-minute video of the building of the car."

So this is progress: Kids outsource their toy car customization to adults sitting in a big box in a store (a real "mini factory"), and interacting with them via a touchscreen … I wished to be a kid again – and know where I will go when I am in NYC the next time!

Update: Business Week has a nice interview with Mattel designer Gary Swisher on " Re-inventing HotWheels" and the company's challenges of designing toys for tech-savvy kids, which also includes a comment on mass customization at Hot Wheels (published on July 17, 2006)

Re-Post: Customize your time: Mass Customization in the watch industry - Microsoft's SPOT watches, Swatch Via d. Spiga, and Factory 1to1 (from the MC Newsletter 1/2003)

Re-Post: I have republished these articles to make them better accessible for search on the blog. This article has been published first in the Newsletter No. 1/2003.

In the age of the cell phone, who needs still a watch? All of us - but more and more not to get the time but to express our personality. Watches are one of the most prominent fashion items and a dominant matter of self expression. Thus, customization of watches is a very interesting field to study. While different companies started several attempts to offer customized watches within the last decade, I would consider few of the existing offers as a serious and professional move towards mass customization. Many companies are either small start up operations with limited scope or professional management of the customization processes, or they do not offer real customization but only small series (e.g., logo watches for promotion activities). But recently, there is a change, and more serious initiatives to customize watches on a real one to one base are approaching.

Microsoft SPOT watches

Bill Gates of Microsoft recently announced plans to use watches as a transponder for customized services. Teaming up with Fossil Inc., Suunto and Citizen Watch Co. Ltd., Gates presented in January 2003 a concept wristwatch based on Microsoft's Smart Personal Objects Technology (SPOT). With compelling features such as customizable watch faces, access to personal messages and appointments, and the ability to receive up-to-date news, traffic, weather and sports information, the watches are the first wave of smart objects that shall extend Microsoft's reach from personal computing to everyday objects. However, first models are expected to be available not before fall 2003. But it will be very interesting to see how these companies bundle hard and soft customization around the physical product and accompanying services.

Two other great examples of mass customization of watches are already available, both focusing on the (aesthetic) design level of customization:

Swiss based watch customizer Factory121 opened its Internet store some months before, and launched officially in April 2003. This is not only the best customization site in the watch industry, but also one of the best configuration systems in all categories. Why? See below.

But let's first have a look on the customization initiative of a big and established player in the industry: Swatch. This brand is sometimes quoted as an example of mass customization - but it is not. Swatch is a typical example of a variant manufacturer that has the capabilities to bring out a huge quantity of variants and collections in a short time. However, customers can only select between made-to-stock products out of a huge variety.

Swatch Via della Spiga

After two very successful decades, the brand lost some of its original power in the last couple of years. While in former times Swatch could handle forecasting and product planning pretty easily as demand was so strong that even not so popular models could be sold without problems, new competition (trends) and an too established brand name force the company to go new ways. One approach to redefine the brand is the introduction of new (standard) models breaking with the traditional product platforms. Another tactic is customization which was recently introduced quietly in one concept store and is now in a pilot phase.

"Experience the language of fashion - you become the artist and accessorize your own Swatch." This is the advertising claim of Swatch's Via della Spiga concept store in Milan, Europe's fashion and style metropolis #1. Placed in the trend setting arena of the city where all big international designers have their stores, Swatch tries to update its image by using the latest fashion details of the surrounding designers for a very special collection of watches. "Catwalk details, chic styling, fabric trimming, edgy appliqués, unexpected coupling of materials, textile variants, enhancers such as crystals, feathers, fun fur, chandelier strands, studs, stones, ribbons, snaps, buckles, and beads await you. It's a chance to indulge your personality. Define your fashion silhouette," says the catalogue.

I visited the store three weeks ago. It looks much more boutique than the standard swatch store, more like a fashionable jewelry store. First of all you recognize a really beautiful collection of ready-made watches which are only available in this store, however, pre-configured. In a second room, a workshops appears. Here, as demonstrated in a video, customers can design their own (women's) watches. Breaking with the traditional concept, clients choose from pre-assembled watch bodies and combine them with a made-to-measure jelly ribbon plastic band that is supposed to be turned around one's wrist, ankle, neck or waist several times. The band can be decorated with heart, flower and star crystal appliqués, and even filled with different objects like small pearls or stars. The results is a very special look (you can get an idea on http://www.swatch.com, go to the "Via della Spiga" section). All custom assembling is done by the client with the help of a sales clerk on the spot. Watches are priced between 37 and 100 Euro.

While the extent of customization is not going very far, and the total approach is rather simple, this is one of the most striking examples of a new customization trend that goes beyond the traditional differentiation advantages of mass customization:

* Swatch uses customization in this store as an expression of self, as a concept to redefine its brand. While in former times a single, often famous professional designer was featured creating a special watch, in this concept the individual customer and its creativity and personal style is in the center of the product design. This is a total change of thinking.

* However, the product family design and constraints of the product system stop "bad design". Even if users have plenty of choices, restrictions prevent that the Swatch brand image is spoiled by bad consumer co-design.

* The open store atmosphere and the public workshop invite a community driven co-design. While in most mass customization applications individuality means also a one-to-one configuration process, the Swatch store provides the platform for a community of users to create an individual piece jointly. Using virtual and real-life communities to support mass customization is a concept that got just recently growing attention.

I am curious to see how this system develops: is it only a short pilot or the starting point of a larger movement? I will keep you posted.

Factory 121

In the watch-making industry, high quality "Swiss made" brands have been out of the reach of the majority of watch buyers - if they didn't want to get a Swatch. The intention of mass customization pioneer Factory121 is to close this gap. Frédéric Polli, one of its founders states it very clearly: "Margins and cost structures in the classic watch distribution channels are a major obstacle to the positioning of 'Swiss made' watches for the majority of watch buyers. New information technologies, like the internet, give us the ability to offer the excellent quality of Swiss watches to ordinary buyers under different conditions."

But the firm does much more than just bypassing the traditional sales channel. On Factory121's Internet site, users can co-design their very own wristwatch. After several years of planning, product development, marketing tests, and technology development Factory121 opened its (virtual) doors at the beginning of this year. The visible center of Factory121 is its web site, developed over a two-year period under the lead of Pete Beck, CEO of Brighton based Electrostrata LTD (http://www. electrostrata.com).

I had the opportunity to follow the development of this company since a longer period of time, and even if I had an idea of what would come up, I was really expressed when the official site launched. What makes this mass customization site an foremost exemplar for its industry (and mass customization in general, make sure that you interact with the site at http://www.factory121.com):

* The customer co-design process begins with a watch model that is already partially assembled. By presenting this pre-configuration, complexity is reduced. However, the combinations offered are almost infinite.

* As in the case of Swatch, the product family design prevents "bad design". Restrictions of choice prevent that a specific style is spoiled by "bad" consumer co-design.

* The 3-D quality of the design tools delivers a great user experience. Speed and feedback of the site are excellent. Virtual images are created in real-time depending upon the uses' choices. The interaction and animation elements of the Internet site are based on Java, a mature, reliable and popular technology that does not demand any plug-in.

* Users get a game-like interactive experience in which they perceive themselves living a unique and fun buying process ("flow experience"). When designing and purchasing a watch from Factory121 the buying process becomes an important part of the product - and, thus, an important driver of customer satisfaction.

* Despite the nice design and experience, the site offers also plenty of explanations and product information. Just have a look at the customized product description once you finished the customization process.

* The site supports price customization. It enables customers to design a watch within the constraints of their personal budget. Therefore, just by choosing, e.g., a leather strap over a stainless steal one, clients can choose an option suiting their budget. As customers work through each category of components, colors and selections, they are always aware of how their design choices are impacting the watch's final price. Doing so, Factory121 is one of the few examples using modular pricing.

The site is supplemented by high customer service. The firm operates own repair centers in its most important international markets, free shipping, and a strong quality guaranty. As buyers cannot physically touch the watch they are ordering, Factory 121 guarantees that, in case of any problems, the product will be exchanged or taken back after repayment in ten days without any question.

The price paid by customers (between 120 and 200 Euro) represents very much a mass customization cost structure - and is much below the average price of a standard Swiss watch of this category. Costs and distribution margins which can easily reach two thirds of a watch's price in a traditional distribution system have disappeared in this model. This enables Factory121 to invest heavily in the maintenance and development of the firm's online platform - and to counterbalance the additional manufacturing and transaction (handling) costs of dealing with individual customers' orders.

As soon as an order is made, it is transferred to the manufacturing site of Rhodanus AG, located in the Swiss province of Valais. The sixty employees of this family owned watch-maker have been assembling prestigious Swiss brands for over thirty years. A made-to-order watch will be mailed to the customer within ten working days. Despite the already launched web site, the owners plan to offer their products also in affiliate stores and for corporate customers.

The web site has just launched, and it's too early to evaluate if Factory 121 will become the DELL of the Watch Industry. However, early user feedback is very promising ("Je suis impressionné en bien par la qualité de votre service client", says Marc Priolo, Head of DELL Customer Service Switzerland). I will follow this case closely and keep you informed what's happening at Factory 121. In the meantime, I am waiting for the real big innovation in this field: How could I customize my time and get that 25-hour-day?

Mass Customization in China: China as a market and manufacturing place for customized goods -- The example of Youngor -- Learnings from the China MCPC Workshop and Study Tour

After the MCPC 2005 conference (http://www.mcpc2005.com), about 40 of our participants went to a three day field trip to China. This was a great experience. During a workshop at Zhejiang University in Hangzhou we could discuss with 50 Chinese business people, consultants and scholars about the state of mass customization in China, both as a market and as a manufacturing location for customized goods. A company visit at Youngor, a Chinese apparel manufacturer, demonstrated a very far advanced mass customization manufacturing and sales operations. And the beauty of the Hangzhou landscape and its lake impressed all of us.

China as a market for customized goods

China is such a large local market with a more and more heterogeneous consumer base. While in many segments still the focus is on fulfilling early demand in local households, other segments, mostly in the large eastern cities, have already a large and sophisticated consumer base. The increasing chasm between income levels creates two more or less separated markets form many goods. Companies like Youngor (see below) target with their mass customization offerings the upper end of the market. Here, demand for customization may be strong according to a number of cultural specialties of Chinese culture:

(1) China has a long tradition in craftsmanship, providing the country both high flexibility and a highly skilled workforce, but also a dedication of some customers regarding highly personalized service.

(2) Crowded cities and communities: Society is still rather uniform but changing fast into a way where uniqueness is honored and appreciated, so customization has a special appeal to many (especially younger) consumers.

(3) Food culture: The Chinese cuisine is highly regional and customized to specific tastes; many Chinese people are highly sensitive to shop for their favorite dish. This may also encourage them to adopt or even demand custom offerings.

And there is weak evidence that China is already moving towards customization: Car manufacturers report that since 2004, more and more cars for the consumer market are not made-to-stock, but are being configured and made-to-order (still not conceivable in the US car market!). Haier, a large manufacturer of appliances, offered already in 2002 customizable refrigerators. While this offering flopped in the consumer market due to a lack of an adequate front-end, it became a hit in the retail market where retailers can order custom versions to differentiate themselves from local competition. And Youngor (see below) has introduced mass customization of suits to the Chinese market at a price point of about 320 Euro / 378 USD a piece.

China as a manufacturer for customized goods

Most often, China is however discussed in western countries as a manufacturing place for custom goods. While there is a large debate if logistic disadvantages would not favor local manufacturing of custom goods close to the markets, several western brands are sourcing the custom goods from China: Most custom sneakers and fashion shoes are produced in Guangzhou for the US and European market, Also, several large US brands like Nordstorm, Polo Ralph Lauren or Tommy Hilfinger are producing some of their custom garments in China.

This trend my increase. China has shown in the past years that its main capability is to build lacking infrastructure very fast. In addition, it can counterbalance coordination demands and complexity handling still with cheap human labor (in one factory which I visited before the conference, almost each single custom order was coordinated and tracked by an individual worker – an easy way to balance the lack of an ERP or MRP system).

But more importantly, Chinese factory managers show no resistance to switch to custom manufacturing if they see a profit opportunity. In many industries, the steadily decreasing order size of standard variants has increased the flexibility and switching capabilities of manufacturers anyway. In addition, the organization of Chinese manufacturing around local industry clusters supports customization perfectly as all players along the value chain are in close proximity to each others.

Most impressing was a visit a Youngor, one of the largest Chinese manufacturers for apparel, including an own custom apparel operations. Youngor produces about 60% of its garments for the local market. It’s suit manufacturing capacity is about 2 mio pieces p.a., and within this segment, custom suits are the strongest growth factor, targeting about 15% of the total capacity. The suits are sold in about 100 of 2000 retail stores owned by the company in China and Japan, using a simple, but clever measurement system combining traditional tape and an easy procedure to set reference points.

The retail price is between 1200 and 5000 RMB (about 150-600 USD), quite a heavy price tag for the Chinese market. Production took place in a very modern, integrated production facility in Ningbo at the corporate headquarters. Individual cuts are calculated in a CAD room, cutting is performed on modern single-ply cutters, sewing operations are performed to a large extend within the normal line producing also standard garments.

I was also very very much impressed the executive manager introducing us to this system. Han Yong Sheng, Vice General Manager and CTO of Youngor, provided a very insightful introduction into mass customization which was very much ahead of the state of discussion beyond many western manufacturers. He shared a great vision of the potentials and challenges of mass customization, and seemed 100% confident in what he was doing and planning. For mass customization, this is a bright future. For western manufacturing, not.

Mass Customization Web Links

A collection of interesting sources on mass customization I found recently the web. All links (and many more) are also added to my collection of mass customization links on del.icio.us, a social bookmarks manager. It allows to easily add sites to personal collection of links, categorize those sites with keywords, and to share the collection with others. CONTRIBUTE to this mass customization link collection by marking interesting links with the tag 'mass_customization'. Then everyone can find them. Here is the list of recent mass customization tags on del.icio.us. And here some new interesting links:

(1) Body scanning is a major enabler to shift the focus of apparel production from large quantities of cookie-cutter clothes to one-of-a-kind articles with individualized sizing and design features. A great web page at Cornell University has plenty of information on body scanning.

(2) WeMadeByMe.com is a sophisticated new website selling customized shirts to really good prices. It offers some nice Flash features (powered by Shirtsdotnet.com), even if the core configuration process could need a bit more support functionality. But it is a promising new start of a new player in the European mass customization scene.

(3) Personalization Stores are nothing new, we have called this store-based configuration since years, and it was the usual form of customer interaction for customized goods before the internet, but CSCOUT, a German/US trend research consultancy, has just called the movement from the web to offline stores a major trend. Great for all who are in this game!

(4) European Management Review: Co-designing modes of cooperation at the customer interface. Implementing and operating personalization stores, or offline configuration systems, is not always easy. This is the topic of an academic article in the latest issue of the European Management Review (Issue 1/2005). The paper explores new modes of cooperation among customers, retailers and manufacturers resulting from co-design.