Consumers’ willingness to pay for customization of smartphones

Abstract

The customization of products presents a strategic opportunity to adapt to the changing consumer needs by offering products that are tailored to a specific consumer’s preferences, differentiating them from other, standardized products. This process positively influences many variables such as customer satisfaction, customer loyalty or consumers’ willingness to pay for such a product. Nevertheless, successful implementation of customization is not yet common. This research focused on exploring personality-based influences on the evaluation of customized products and the demand for such by measuring the impact of consumers’ need for uniqueness on their willingness to pay for a customized product as well as on the perceived quality of a customized product. For this purpose, different levels of customization were tested and explored using qualitative as well as quantitative data. Results show that the customization of all product attributes is highly appreciated by consumers, expressed by an increased willingness to pay. Here, the perceived quality of a customized product fully mediates the increased willingness to pay. Most importantly, consumers with a strong need for uniqueness are willing to pay more for customized products than consumers with a weak need for uniqueness. Therefore, this study offers valuable insights into how customization is not valued equally by every consumer and that the right segmentation of consumers can lead to higher marketing efficiency and the adaptation of the pricing strategy to increase profitability.

Date of Award	28 Jun 2022
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Paulo Romeiro (Supervisor)