Pricing Gem: The Customisation Boost

At one level, allowing for the customising of commodity items is an obvious and clear route to price optimisation and profits. A standard T-shirt with a bit of embroidery and print on it moves from being ￡3 in Sports Direct in plain guise, to ￡11.60 delivered as a uniquely designed piece of team clothing just for you. The customer can compare sources if they want, but that means redoing the quote and uploading the logo again. Chances are they are all price-matching anyway and when it comes to repeat buying, using the same source makes a colour match much more likely! Why risk it for a few pennies?

Customisation has been used in its classic form for decades. Think of the gentlemen’s tailor compared with the Marks & Spencer standard suit; hand-crafted shoes compared with mass-market; and moving on to the ubiquitous Build a Bear! Are you paying for the perfect bear, the experience, or the advertising?

Increasingly though, customisation is being used to engage a customer, prevent easy comparisons and use up the energy of the buyer to prevent onward research. Think of the car buying process – the manufacturer’s brand influences a customer’s overall perceptions, the style and use determine the range of models that will suit, but then we move to comparing the price of like models across brands.?

The first question a customer is asked is 'Where would you?like to start?'

It’s your choice where you start. Is it the features, the trims, the colour, or is it the offers and finance? Where you start may vary, but what is for absolutely sure is that you are in for a long haul. Keeping track of the decisions you have made and how the cost is being built up is a job for the forensic accountant.?

So then comes the key question, are you really going to do it all over again to get a comparative price? And if you do, will you be able to make equivalent decisions between standard features and items of choice? No chance!?Despite this effort, is your car really unique to you? Is it really the tailor-made suit or handmade shoe of vehicles?

Pricing gem:

True customisation is absolutely great, adding real differentiation and price opportunity to an otherwise standard product. Increasingly though, we can achieve customised price through creating an experience of the buying process itself, simultaneously making price comparison really difficult.

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