Not Every Customer Is Created Equal

08/28/2013 05:11 EDT | Updated 10/28/2013 05:12 EDT

Have you ever borrowed a friend's iPhone? It feels weird. (If you're an iPhone owner yourself, that is.)

At the same time it is entirely familiar -- the weight in your hand, the feel of the screen -- and totally alien, even the familiar apps are out of place. But this should make sense: it's called iPhone, not wePhone.

This weird feeling is about to extend far beyond our mobile devices. In fact, it's going to reshape almost everything. Mass personalization is here. It's weird, but it's also awesome, empowering, profitable, and lifesaving.

Mass personalization is a new trend enabled by technology. It used to be that if you wanted to make something for everyone, you had to assume everyone was more or less the same. Then you could make a massive batch of your product to keep the cost low. Economists called it economies of scale. This meant that products had to be designed for a hypothetical (and imaginary) "average person" so that the needs of everyone could be mostly met.

Not anymore. Today it's about producing personalized products for each one of us. These products will increase customer satisfaction, loyalty, and profitability. Smartphones are just an early and familiar example.

While every phone runs the same basic code, each user is free to customize the appearance and functionality of their phone to their particular needs and tastes -- at no additional production cost. The result is a product that is ideally tailored to one and only one user.

But manufacturing technology is catching up with what software can do: in phones, personalization is moving beyond the software. When buying a new Moto X from Motorola (a Google Android phone notably assembled stateside in Texas) each and every customer can tailor the physical appearance of their phone in one of 504 combinations. This hasn't increased the phone's price relative to competition, and customers can expect their new phone to arrive at their door within four days.

Phones are just one example. Suits are another. Fashion startup Indochino will tailor a suit to fit you perfectly for less than $500. Here's how it works: customers receive in the mail a free measuring tape with which they capture a few key data points about their bodies. These measurement data are keyed into the site along with fabric and style choices. Finally, a submit button is clicked. Then halfway around the world a combination of humans and robots work to turn those data points into a suit that fits perfectly. Three weeks later, the suit shows up ready to wear. The results are impressive.

A combination of software, robotics, and human expertise delivers excellent results in situations like these, but what about products where personalization can't be added in these ways? For the answer, and the future, we have to turn to 3D printing.

The baby boomers are aging and they picked a fantastic time to do it. The past 20 years saw a boon for the sale of inexpensive reading glasses as boomers' eyesight faded en masse. Now, it's their hearing that is starting to attenuate.

While glasses could be mass produced along a few guidelines for stock prescriptions, hearing aids cannot -- not if they're to sit comfortably in the ear of the wearer. To fit snugly and work correctly, hearing aids require mass personalization. The standard way to produce hearing aids was with a nine-step artisan moulding process that took more than a week.

Today, more than 100,000 3D printed hearing aids are in use. These 3D printed hearing aids are based off of laser scans of human ears, then printed in batches of 65, which takes about 90 minutes. Each of the 65 hearing aids is specifically modelled for exactly one human ear. The fit is just as good, and the cost is dramatically lower in the long run -- at least for retailers.

Hearing aids are just one category of product that will be dramatically reimagined. Everything from prosthetic jaws and limbs to toys, jewelry, and even clocks can be 3D printed. The trick will be finding out which of these new and newly-tailored products is right for us. Fortunately, the way we find out about what we can buy is also being reinvented. We're at the dawn of personalized advertising.

To tailor a suit, relatively few data points are required. But when it comes to measuring someone's likelihood of clicking an ad, many psychological and behavioral metrics must work together elegantly. The result, when it's done well, is advertising that informs and delights but never annoys.

Google is an early player in this space and has used simple behavioral data (what people are searching for) to target ads better than anyone ever before. But search terms are one-off pieces of data. Given the number of channels available for customers and companies to interact, there are much more data to collect.

If this data is securely put in the hands of responsible and skilled advertisers, there are tremendous opportunities for us to be introduced to new and useful products. In part, this is what people are doing when they talk about "increasing the effectiveness of targeted advertising."

Doing this requires tremendous skill and training that is possessed by very few people, called data scientists. Fortunately the personalization of education will allow us to train more data scientists than ever before -- along with every other type of professional.

But personalization won't stay in the consumer world. It will also impact us at a level so profound it can't be seen with bare eyes: in the original experiment in mass personalization, our DNA.

To date medicine has been forced to assume that people are more or less all the same. While this is true in the general case, inexpensive DNA sequencing is allowing health care providers to be more specific about health care than ever before. Already one-off DNA sequencing, like the kind performed for $250 a shot by the Spartan RX, an Ottawa-designed bedside device, has allowed doctors to determine which drugs a patient should be prescribed based on their unique genetic code.

Similar DNA tests, like the one offered by 23andMe, are also routinely used to diagnose diseases that might have otherwise gone undetected. This is just the start, and our mastery of chemistry is allowing pharmaceutical companies to design drugs that offer each of us the best possible treatment.

Mass personalization is just beginning to come online and enter the collective consciousness. We don't yet know what the most exciting implementations are because they haven't yet been invented. What we do know is that the assumption that all of our customers the same is now outdated and we all need to update our products, our services, and our thinking.

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