The Future of Consumers & the Personalization Revolution
In the world today, there exists an entire generation of consumers and decision makers who may be a little unpredictable. These consumers may not have brand loyalty that looks the same as loyalty has in the past, and while they can go a long time without choosing a brand to favor, they are likely to favor brands that give them exactly what they want, when they want it. Enter personalization.
A decade ago, Nike looked at their future trajectory and realized that if they did not change something drastically to put the consumer in charge, they may not remain a consumer favorite. Over the course of the last 10 years, Nike has introduced a variety of personalization options, giving consumers the ability to create the exact shoe they want, when they want it. The result? Increased sales among the most at-risk fanbase (consumers considered shoe hobbyists that could easily go to another brand), as well as increased sales from new customers—even when the product cost more.
In a recent Bain survey, the research found that consumers are willing to pay up to 20% more than standard product prices, just for the sake of having a personalized product. Another sportswear giant, PUMA, recently offered customizable jerseys for their Arsenal FC line, charging 30% more than their standard jersey’s price tag. The result? The customized jerseys now account for more than half of their total jersey orders. When consumers get to choose how their product will look, or how it’s made to suit them, they understand that a premium will be involved—and it doesn’t seem to negatively affect them. As a matter of fact, when surveyed, up to 71% of consumers were willing to pay that premium for a product they got to personalize. The short answer is that consumers would prefer to fork over extra cash, and do it more often, to have something that is uniquely theirs… even if it only is uniquely theirs from a pre-set pool of variable choices.
The truth is that customization must be the future of consumer packaged goods and retail. Millennials and Generation Z—a whopping 40% between the ages of 16 and 30—have made it clear that they are interested in personalizing the products they own. These particular generations are currently making buying decisions and will only continue to accrue buying power in the future. Additionally, 36% of consumers overall, even outside of that specific age range, are interested in having personalization options available to them. Of these consumers, 42% are interested in a user-friendly technological interface designed to guide them in these personalization choices.
The key for brands to keep in mind will be to limit these personalization options: if a brand gives unlimited options for customization, they’re likely to lose money on elements that can be personalized thousands of times, with no standard set. If brand and product managers can determine what about their product can be personalized once or twice, they can succeed in the journey toward product personalization. They can also take the insights given to them from their consumers (as their consumers personalize their own products) to determine what styles are hot, which elements of the product could be changed due to overwhelming popular opinion, and what tweaks could be made to upcoming seasonal lines in order to ensure their top sales performance.
The aforementioned Bain survey also found that, of 1,200 global executives in several industries, over 67% of them thought that their consumers were becoming less and less loyal to their brand. As consumers start to carefully consider where they spend their money, voting with their dollars on products they believe in, brands can stay ahead of the curve in a big way by offering these consumers a product that can become a part of them as a person.
Stay out front in your brand’s race to the top: learn more about how Sonder can help you with mass personalization of your products!