Testing the value of customization: When do customers really prefer products tailored to their preferences?

Nikolaus Franke, Peter Keinz, Christoph Steger

Publikation: Wissenschaftliche FachzeitschriftOriginalbeitrag in FachzeitschriftBegutachtung

Abstract

Recently, researchers have paid increasing attention to the marketing strategy of customization. One key assumption is that customized products create higher benefits for customers than standard products because they deliver a closer preference fit. The prerequisite for this effect is the ability to obtain precise information on what customers actually want. But are customers able to specify their preferences that precisely? A number of theoretical arguments raise doubts as to this point, thus implicitly challenging the value of customization.

The authors conducted two studies in which they found that products customized on the basis of expressed customer preferences bring about significantly higher benefits for customers in terms of willingness to pay, purchase intention, and attitude toward the product than standard products. The benefit is higher if customers have (1) better insight into their own preferences, (2) a better ability to express their preferences, and (3) higher product involvement.

This suggests that customization has the potential to be a powerful marketing strategy if these conditions are met. In the opposite case, firms willing to serve heterogeneous customer preferences need to adapt their customization systems in such a way that they explicitly address the customers' inability to provide valid preference information.
OriginalspracheEnglisch
Seiten (von - bis)103 - 121
FachzeitschriftJournal of Marketing
Jahrgang73
Ausgabenummer5
PublikationsstatusVeröffentlicht - 1 Nov. 2009

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