Research indicates that in the current world, the challenges for multinational organizations especially those that deal in consumer goods are increasing rapidly. These challenges have been accentuated by two primary factors; changes in demographics and information technology (Schifferstein and Hekkert 400). The two factors have led to a situation where information has become depersonalized. The modern consumer has become more knowledgeable and in response to the two mentioned factors, the current generation has become more perceptive and demanding of more individualized product and service offerings (Barutcu 577). This generation of consumers is, in fact, ready to pay huge premiums for customized products that meet their individual needs and requirements (Barutcu 575). The modern consumers are orienting towards purchasing products that make them stand out as individuals. There has been a shift of focus from simply owning a particular product to owning a product that distinguishes one from another. This has forced many multinational companies to adopt new business approaches that are aimed at providing custom made products for customers and clients. This trend has particular been very vibrant in the clothing and sportswear industry (Barutcu 580).
One sample company that has adopted starter oriented toward personalization is the global sports accessories manufacturer NIKE Inc. For a long time, NIKE has been a leading producer of sports accessories that include sports shoes, sports jerseys, caps, and socks amongst others. The company for a long time managed to have a consistent and steady market share with faithful customers who bought its products. In recent years, however, other manufacturers of similar products have flooded the sports manufacturing industry, and this has led to increased competition (Dietrich et al. 190). In addition to new players in the industry, the new information age has not only led to an increase in the purchasing power of consumers but have also brought about a new generation of customers who desire customized and individualized products (Dietrich et al. 193). It has emerged that sportswear consumers no longer desire just any product but want individualized products that are meant to meet their individual needs (Schifferstein and Hekkert 400). For instance, when it comes to shoes and jerseys, some consumers have a preference for special designs and attachments, aspects that are not offered by common brands (Dietrich et al. 196). There are other consumers who want their names to be printed on the products or even the names of their favorite sports icons.
Consequently, NIKE as a global brand has been forced to shift its business strategy especially in regard to one of its most iconic products; the NIKE sports shoes and clothing. The company started a new service called NIKEiD that allows consumers to personalize the products that they buy from this company. In this new product, the customer essentially becomes the designer and adds an individualized and personal look to the item that they want to buy. When this service was first launched, it could only be accessed from NIKE’s website where prospective consumers would log into the company’s homepage (www.NIKEid.NIKE.com), chose a particular item of interest and proceed to fill in individual specifications that they would want their product to have (Dencker n.p). The consumer would then proceed to buy the product, wait for it to be custom made and then shipped to them. Some of the individual specifications that the customers are given the chance to dictate include color, material, size and general outward design. This particular strategy particular has proven to be a huge hit with the company especially in regard to its bestselling product; sports shoes. Annually, thousands of consumers who want to have customized and individualized shoes log into the site and make individual specifications for the shoe brands that they desire from a predefined set of options (Schifferstein and Hekkert 434). NIKE’ online community has grown tremendously, and it is currently pushing towards 20 million. The company has also seen a significant increase in terms of market share with statistics showing that in the last one and half decade since the product was launched, the company market share has risen in the sports accessories industry to about 61% from 48% (Dencker n.p). Currently, the NIKEid online store accounts for more than 20% of the company total revenue (Dencker n.p). The strategy has been so effective that in recent, the customization program has been extended from the online arena to physical stores. Customers can make specifications about their desired products by going to the selected physical stores across the globe and forwarding their specifications (Dencker n.p).
NIKEid program is a perfect exemplification of how multinational corporations can take advantage of the new ergonomic trend of increased desire for customization and individualization of products especially in the clothing and sportswear industry. It is a perfect example of how companies can adopt their strategy to allow consumers to place directions for customized and tailor made products and at the same time, it depicts how companies can utilize this trend to boost their total sales. NIKE has been able to boost its total revenues and at the same time increase its market share due to the newly adopted strategy. Customized products are better in fulfilling the needs of the consumers and can even partly contribute to increased emotional attachment to a certain product by a consumer and NIKE is a perfect exemplification of this.
Conclusion
The current trends in the global product markets dictate that customization and individualization is the way to go. Increased depersonalization, information has brought a new generation of consumers who emphasize on customized and individualized products and services that are meant to meet one’s individual needs. Companies must, therefore, shift their strategies towards the customization of their products if they hope to remain relevant in the market.
Works Cited
Schifferstein, H., and Paul Hekkert. Product experience. San Diego, CA: Elsevier, 2008. Print.
Dietrich, A. J., Kirn, S., & Sugumaran, V. (2007). A service-oriented architecture for mass customization—a shoe industry case study. Engineering Management, IEEE Transactions on, 54(1), 190-204.
Dencker, David. "NIKE iD – The First Example of Mass Customization Driving Revenue? “Crossroad Innovation NIKE iD The First Example of Mass Customization Driving Revenue Comments. N.p., 10 Sept. 2010. Web. 26 Oct. 2014. <http://www.crossroadinnovation.com/NIKE-id>.
Barutcu, Süleyman. "Customized products: the integrating relationship marketing, agile manufacturing and supply chain management for mass customization." Ege Academic Review 7.2 (2007): 573-593.
