Stop the Binary Thinking with Mass Customization
“Why fit in when you were born to stand out?” — Dr. Suess
With that in our brains from a young age, it’s only natural we’d want everything as customizable as our individual uniqueness. In my opinion, this includes functional CPG products…
The problem lies in the fact that functional CPG products are the prototypical examples of non-customized “make to stock” manufacturing. What could be more made to stock than tubs of whey protein or containers of pre-workout that look the same in all markets where they are sold?
Competitive pressures in the marketplace, however, have radically changed consumer expectations for many functional CPG products. Wellness isn’t a one-size-fits-all approach…its a personalized continuum that evolves. This is partly why consumers have began evolving past only wanting variety and now expecting functional CPG products will be personalized to meet their unique needs and requirements.
These trends are influencing manufacturers to step up their customized product offerings. Mass customization has been the “next big thing” in functional CPG product strategy for a very long time. Believe it or not, discussions around mass customization within the functional CPG manufacturing sector have been going on for more than two decades.
From a functional CPG brand’s perspective, the ability to offer a tremendous increase in variety and customization without a corresponding extreme increase in costs to the customers buying the products would be nirvana. Mass customization functional CPG products offer consumers distinctive, individualized choices, and they give brands enormous opportunities to boost sales, brand awareness, and loyalty. I mean why would you want to consume functional CPG products that aren’t customized for you if there was price parity?
The functional CPG industry just isn’t there yet though…
Mass customization offers a number of challenges to the traditional asset-light third-party manufacturing model in the functional CPG industry. Most of these contract manufacturers are holding up the movement instead continuing to push the “make to stock” narrative built on manufacturing efficiencies and ease of adhering to regulations. If not managed properly, costs could increase substantially and the customized products could become a liability rather than an asset for brands and manufacturers.
It’s really a double-edged sword when considering how to scale “make to order” manufacturing, but I believe the smartest functional CPG manufacturers will start shifting to customization soon, thus carving out a differentiation strategy that will help them stand out in a highly competitive market.
This all begs the question if functional CPG brand owners should abandon the idea of customization in the near-term or creatively find ways to integrate elements of it now…
For functional CPG brands to succeed with “make to order” products, it must occur at the right place in the commercialization process. Customization strategies should be laid out clearly and built around simple, executable models from manufacturer to customer. It maintains a reasonable cost of goods sold while offering the “make to order” features consumers are looking for.
Here is a list of several customization strategies:
- SKU Proliferation — although most functional CPG brands haven’t (knowingly) shifted to “make to order” strategies yet, the number of product variants offered by each have exploded exponentially. I’m not saying that’s always the best thing (Note: perform a SKU rationalization from time to time), but it does help marginally fulfill consumer expectations for customization.
- User Selected Variety Packs — functional CPG brands can improve the level of customization offered to shoppers by allowing them to select variety packs that aren’t hardcoded on the website.
- Personalized Packaging — bespoke label printing can improve the customization feel of the product.
- Flavor Separation — in the powders categories you can separate flavoring system and “bases” to offer more customization.
Case Study: GAINFUL
GAINFUL was created in 2017 when its founders were overwhelmed with finding the right supplements and knew others were having the same experience. GAINFUL offers personalized subscriptions to several categories of nutritional supplements (most notably protein powder). So, how does Gainful work and how is the functional CPG brand achieving some benefits of mass customization?
- Take the health quiz — questions are lifestyle-oriented, such as height, weight, exercise patterns, fitness goals, and consumption frequency of the products.
- The GAINFUL personalization engine (algorithm) provides a recommendation on a “base” protein powder configuration.
- Consumer will then select a handful of “flavor boosts” (flavoring system) to add into the “base” protein powder. This allows the user to keep things interesting by having more flavor optionality.
- GAINFUL provides ongoing access to a registered dietitian who can answer any additional questions.
Brand to Pay Attention To — Nourish3d
Similar to GAINFUL, a consumer initially completes a short questionnaire on the Nourish3d website describing your lifestyle, health issues, and nutrition goals. Nourish3d’s algorithm then builds you a unique “stack” out of their “nourishments.” The company then 3D prints bespoke, layered vitamins just for you out of vegan gel, which end up looking like rainbow gummy candy. It’s this 3D printing technology that opens up a whole new world of personalization possibilities.
In today’s consumer-driven marketplace, it’s a smart idea for any functional CPG brand to create some aspect of customized offerings that can meet the specific demands of customers. Functional CPG brands should choose a mass customization approach that aligns with its goals and satisfies current consumers’ requests. It’s also integral to stay up-to-date on consumers’ preferences and seek out feedback from them. Being able to administer custom offerings, that are of high-value to consumers, will put your brand ahead of the competition that is swimming in the sea of sameness.