The Customizer Is Always Right
Why I said good-bye to one-size-fits-all and became part of the mass one-to-one market.
By J. Bradford DeLong
Somewhere in the depths of the Lands' End Internet operation, a computer has got my number.
It started with a simple email offering a free pair of pants if I would send in my waist and inseam measurements and the shape of my thigh. I did. The pants came. (Actually, a bug caused me to receive two free pairs, but I'm not complaining.) I forwarded feedback on the fit, and the computer tweaked the measurements.
The net result: a great pair of pants for not a lot of effort.
"You're a typical American male," my wife, Ann Marie, said. "They're guessing that you don't like to shop, value convenience above all, and will pay just to avoid having to go to the store. I've bought 10 times as much stuff at the Lands' End Web site as you have, and they've never offered me a free pair of pants."
She's right. Ordering online versus going to the mall is no longer much of a choice. The fact that after an hour at the store I emerge with something that's an inch too long has made me even less enthusiastic about the mall. And so Lands' End cleans up, charging me extra for the quality of the fit.
I'm not alone. Custom orders reportedly account for 40 percent of the company's Web site sales in the chino and jeans categories. "When we went into this, we estimated it would be 10 percent," Bill Bass, senior VP of ecommerce and international sales, recently told The New York Times. But it turns out that once customers are confident the fit is right, "they'll typically buy every color in those jeans or chinos or whatever." And Lands' End did this with no advertising beyond its mail-order catalog.
Futurists have long forecast that the information age will mark the dawn of mass customization, just as the early 20th century saw the rise of mass production. Everything from breakfast cereal to business-school textbooks will be specially tailored to your tastes or needs.
It's a big switch from the model pioneered by Henry Ford. Back then, the idea was to focus on cutting costs to the bone by making as many completely identical products as possible. Thus Ford could take maximum advantage of all available efficiencies. And he'd sell you any car you wanted - as long as it was a black Model T. He was in the business of selling transportation as cheaply as possible, and giving a consumer a choice of model or color would complicate the system, erode the scale economies, and raise costs.
Yet it turned out that people wanted the freedom to buy a car that didn't look like everybody else's. At General Motors, Alfred P. Sloan and his fellow executives figured out that the principal economies of scale were to be found in the manufacture and assembly of the chassis and drivetrain. They came up with an alternative business strategy: Take advantage of all enabling technologies and margins, then slap a body - a Chevy, an Olds, a Buick, a Caddy - on top and paint it whatever color - red, cream, green, black - customers wanted. For 10 to 20 percent more than Ford charged for its Model T and then Model A, consumers could have a car that looked the way they wanted it to look rather than the way Henry Ford wanted it to look. From the late 1920s into the 1970s, GM raked in the profits, because, hard as it may be to believe, some people really did want a lime-green Buick with large fins.
GM offered choice, but it wasn't really customization - no more than being offered blue or tan chinos in size 34 or 36 is customization. Mass-production apparel operations have no clue which pair of pants are destined for me. They distribute clothes in various sizes and styles with no real knowledge of tastes and preferences until the end of the season - when sold-out lines represent lost opportunities and discount racks stand as reminders of costly wrong guesses.
Now we may be on the verge of the era of mass customization. Today, it's possible - if not quite easy - to keep track of which pair of pants sewn in Mexico goes to which US consumer. And it is the extraordinarily low cost of information processing that is the key.
How important is all this? It may be very important. There may be a huge array of goods for which people are willing to pay a hefty premium to get exactly what they want. From custom Baby Gap sweaters and Barbies to personalized golf clubs and perfect reproductions of your broken-in jeans, mass customization is rapidly replacing one-size-fits-all commodities.
Meanwhile, there has been a slight shift in the economy.
There is a fraction less of a job in men's pants sales in California. There is a fraction more of a job keeping a server running for Lands' End. Somewhere in Mexico, a factory has added employees and shifted its mix of products to occasionally make not the normal run of pants that then need to be altered but a special pair just for me.
Contact J. Bradford DeLong at www.j-bradford-delong.net.
Posted by DeLong at January 20, 2003 01:26 PM