Another extremely powerful aspect of e-commerce not readily
and affordably available to traditional commerce is the customization and
personalization of marketing efforts made possible through the Internet. With
personalization, merchants can target their marketing messages to specific
individuals by adjusting the message to a person's clickstream behavior, name,
interests and past purchases. The technology also permits customization that is
changing the delivered product or service based on user's preferences or prior
behavior. Given the interactive nature of e-commerce technology, much
information about consumer can be gathered in the marketplace at the moment of
purchase. With the increase in information density, a great deal of information
about the consumer's past purchases and behavior can be stored and used by
online merchants.
The result is a level of personalization and customization
unthinkable with traditional commerce technologies. For instance, you may be
able to shape what you see on television by selecting channel, but you cannot
change the content of the channel you have chosen. Viewers cannot personalize
their viewing experience. Same applies
to reading a newspaper, magazine or listening to the radio. It is a concrete medium that is presented as
it is without the ability to offer a unique, individualized experience
capitalizing on individual preferences.
The Web offers consumers the ability to adjust preferences
according to their likes and dislikes.
For example, the web site Tonton has completely changed the television
experience, personalizing entertainment. In the past, if you missed your
favorite show due to an uncontrollable schedule conflict, you were out of luck
until you could catch the show in syndication. In today's Web powered
environment, you can simply go online and watch the show. Tonton is just one example and there are
numerous other sites that all give control to the individual regarding time and
place decisions. Viewers are still
subject to advertisements as a condition of using the site, however they are
far less in frequency than on the original show. With extremely busy schedules, this
convenience and control afforded to individuals provides tremendous incentives
for loyalty.
Another example involves reading the New Straits Times. It requires a lot of time and effort sifting
through numerous articles related to your search. Now consider the value
offered through the New Straits Times Online, it allows you to set preferences to
display articles only related to certain criteria, select the type of news
stories you want to see first and gives you the opportunity to be alerted when
certain events happen.
There are many physical retail store that offer product
customization via e-commerce. For instance, Adidas, Converse and Nike through
NIKEiD. These website enable customers to customize their own shoes, clothes,
bags or accessories according to their tastes and preferences. They can choose
their own design and colour. An obvious potential advantage of customization is
greater customer satisfaction that will leads to greater profit. Customization also bring product
differentiation to the brand. However, there is also potential disadvantage for
customer which is the cost. For example,
the customized Adidas shoes are about 30% more costly than the standard
line. Again, the question is whether the
incremental volume and strategic advantages overcome this cost.
