LAUSR

Abstract Increasingly, many brands are handing over to consumers the control of the design process, allowing for the customization of products, experiences, and services. While there is a clear demand for customization, the general assumption is that such demand is homogeneous among consumers. We propose that heterogeneity exists in consumer demand for customization and that a better understanding of these differences is important for brand managers to effectively develop and deliver to consumers the opportunity to customize. Drawing on configuration theory, we provide insights into consumer market segments for firms seeking strategic fit for more effective customization. Across multiple studies, a Latent Cluster Analysis is utilized to profile customization demand. Four distinct segments are identified: Non-Customizers, New Customizers, Active Customizers, and Lapsing Customizers, while studying their outcome considerations in terms of new product design. The varying patterns of customization preference and consumption patterns among segments provide opportunities for retail and service providers to target customization offers more effectively.