Are customers willing to pay more for mass customised products? That is the question a research team in Australia hoped to answer in the latest issue of the International Journal of Mass Customisation
Hassan Kalantari of the Department of Science, Engineering and Technology and Lester Johnson of the Department of Management and Marketing at Swinburne University of Technology in Hawthorn, Victoria worked together on the conundrum. The team carried out a conjoint analysis, a market research technique, to see whether there is a trade-off between price, delivery waiting time , type of customisation in the niche market of walking stick sales in Australia. The market may well be niche, but it is large, and moreover, the team suggests that their approach could easily be used to study other mass markets that offer customization of products.
The work hinges on the gradual change that manufacturers have seen in many areas of sales where customers are no longer happy to accept the off-the-shelf products being offered but hope to have bespoke products tailored to their exacting requirements. It is inevitable that without the economies of scale that mass production provides, companies will be forced to charge more for their products, but will customers be willing to pay more?
The team found that customers are indeed willing to pay more for a customised product but are often also willing to wait longer for delivery provided they receive a discount on the price.
Kalantari, H.D. and Johnson, L.W. (2019) ‘Willingness to pay and wait for mass customised products’, Int. J. Mass Customisation, Vol. 5, No. 2, pp.111–129.