Episode 21 - Should you offer personalized products in your Shopify store?

The Podcast

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Show Links

• Product Configurator 
• EtchingX
• Shopify article on Line Item Properties 
• Product Options by Bold 

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Transcript

Hey folks, Scott Austin here. 

I'm going to start off by telling you a bit of an origin story for me and Shopify.  I bring this podcast to you through my JadePuma agency, which is dedicated to helping clients build and grow their Shopify business.  I started that agency in 2018.  I also have another company, called ProductGraph that I started in 2013.  ProductGraph provides personalization software to e-commerce stores.  Our software is called Product Configurator.  In working with our personalization customers, we interacted with many e-commerce platforms like Big Commerce, Magento, and Shopify.  And we found that our Shopify clients had the most successful online stores.  We also found the Shopify platform to be the easiest one to build an app for.    So it was that introduction into Shopify that motivated me to learn more about the platform and Shopify quickly became the only platform that I would recommend.  And now it’s the only platform that I work on.  So that's how I got to here.

Now let's talk about this episode's topic, which is personalized products.  To set the proper context, there are two types of personalization in e-commerce.  One is where the merchandising in the web store is personalized to the customer's specific preferences.  The other is where the product is personalized.  For example, engraving a name on a product.  In this episode, we're going to be discussing selling personalized products in your Shopify store.  So products that are engraved or printed with a name, date or other personal messages. 

There's no shortage of studies that show people perceive personalized products as having more value than their non-personalized counterparts.  In fact, personalized products sell for an average of 33% more than the plain version.  Let's examine some of the psychology behind this. 

The short answer to why personalized products are worth more is that it's not about the product.  It's about a feeling.  And that feeling comes from something beyond the product.  Here are some examples:

1. It's not a product, its a memory.  If you've ever seen the movie With Honors, Joe Pesci's character carries some pebbles with him that he values very much.  Each pebble was something he picked up from the ground during an important milestone in his life.  Those pebbles carried the value of the moments they came from.  It can be the same thing with personalized products.  It's not that it's a watch.  It's that it's a retirement watch that commemorates your 20 years in the armed forces.  Or it’s the watch your parents gave you for graduation.
2. It's about the thought.  You know the old adage that "it's the thought that counts."  A personalized gift shows even more thought on the part of the giver.  Not only did the giver choose the product, but they also choose how to personalize it.  And the personalization takes more thought than getting a plain product and, therefore, means more to the recipient.
3. It's about human connection.  A personalized product allows people to memorialize their relationships.  This can be celebrating 50 years of marriage.  Or it can be a groomsman gift with an inside joke that only the giver and receiver will understand.  Or it can be the latitude and longitude that two people met at.  Or it can be any number of other ways to memorialize you and the people you love.
4. It's about you!  We're all a little bit narcissistic.  Way back in the 1930s, Dale Carnegie coined the quote "Remember that a person’s name is to that person the sweetest and most important sound in any language."  That rule certainly remains true today.  By personalizing a product with a person's name, the product becomes more valuable to the person because their name is the most important thing to them.  Add their personal motto or another aspect of their personal brand to the mix and it's even more valuable.

So that's the value that customers see in personalized products.  Now let's talk about the benefits of personalized products to you the store owner.

1. You can charge more for personalized products.  The average markup for a personalized product from the non-personalized price is 33%.  So personalized products help you increase your Average Order Value, or AOV and your revenue and profit.
2. Personalized products can help you differentiate yourself from the competition if your competition isn't personalizing their products.  As shipping is now time-sensitive across all of e-commerce, personalization can help you compete against overseas competition that is too far away to provide personalization along with reasonable shipping times. 
3. Personalized products are more valued by the customer.  So the customer is more likely to hold onto them much longer as it's hard to throw out something that is more than just a product and is instead a treasured memory.  So by the product staying in the hands of the customer longer, there's more opportunity for word-of-mouth marketing from that product.  And because of the treasured nature of the personalization, the customer is more likely to participate in that word-of-mouth marketing.
4. Personalized products are less likely to enter the second-hand market so your used products won't compete against you.

So there are plenty of business benefits to selling personalized products.  But it also involves some work.  Here are some of the impacts personalized products can have on your operations:

1. Product personalization starts after the order has been placed.  So you'll need personalization staff that is continuously available to personalize products as orders come in.  This means it's hard to turn lights off for a week and go on vacation.  You also can't just batch the personalization process up to be done once a month like you can with other product tasks.
2. Personalizing products takes some skill and learning.  It's not the kind of work that most fulfillment companies provide.  So you'll most likely need to take this on internally.
3. You'll need machinery for the personalization process.  Whether its printers, laser engravers or another process.  Those machines will cost capital, require training and take up floor space.

Here are some best practices to think about for personalized products.

1. If a product comes in a personalized version and a non-personalized version, make the personalized version the default on the product page.  It leads the customer down the most desired path.  And in my experiences with my clients, their customers choose the non-personalized version when they want, so there's no confusion.
2. Limit choices.  Now this may sound counter-intuitive when we talk about making a personalized product for a customer.  But I've seen this in many stores.  Less choices will increase conversion.   Because by giving the customer less options, it will be easier for them to make a decision and keep moving forward in the process.  Let me use fonts as an example.  It's my recommendation to offer no more than 4 font choices - a serif, a sans, a script and a fun font.  Let's say a customer is looking for a wedding gift in your store.  An obvious font for a wedding gift is script.  If you only offer one script font, the choice is easy for the customer.  But if you offer 5 script fonts, the choice then becomes hard.  And hard choices result in reduced conversion.
3. Similar to limiting choices is limiting the personalization.  At ProductGraph, we recommend what we call a design-on-rails.  That is a design that is created by you, the store owner and gives the customer a couple of choices to make like name, date, font or color.  Most customers don't have the time, interest or skill to create their own designs from a blank canvas.  So the design-on-rails is a great combination of a personalized, and therefore more meaningful product, that is also easy for the customer to create.
4. Now there are times that you do want to offer a full custom design product to your customers.  Here's how I recommend you implement custom designs:
1. Make the full custom design option a product with a price that the customer can buy right now.  Do not leave it as a request a quote form.  To make it a product, you'll have to standardize your pricing a bit.  But it will pay off.  Here's a data point.  I did a store redesign for EtchingX, who makes beautifully etched wine bottles that make great gifts.  Before the redesign, they had a full custom design product that had a contact us form that kicked off a lengthy price quote process.  So we turned that into a product with fixed pricing, which was the most expensive product in the store because it provided the highest value.  As soon as we launched it, the custom bottle became the best-selling product in the store.  A few reasons are:
1. Most customers don't want to talk with people during the sales process.  They want to see the product details fully spelled on the product page.
2. The pricing was clearly spelled out.  So the customer quickly the price difference between the personalized options and the fully custom product.
3. Now that it was a product, it had product reviews which are powerful social proof and helped the customers understand the value of what they were getting.

So now let's talk about how to allow customers to input their personalization during the ordering process in your store.  You want to automate as much of this as possible to reduce the manual effort required which will also reduce errors.  You should start by deciding what choices your customers will make during the personalization process, so you can determine which tools can offer those.  Here are some ways to implement personalization on your product pages from the simplest to the most complex.

1. First is line item properties.  Line item properties are a well-documented Shopify feature.  They require liquid code changes to your theme.  So if you are comfortable with Liquid code, you can implement them yourself.  If you are not comfortable with code, then you can hire a Shopify Expert for the work.  With Line Item Properties, you can add, for example, two text boxes where the customer can enter a name and a date.  And a pull-down menu where they can select a font.  There are limitations though, so it only works for the most basic options.  I'll include a link to a Shopify article on how to implement Line Item Properties in the show notes.
2. The second is the Product Options app by Bold.  The Bold Product Options app is a great one to use for scenarios that do not require visualization of the personalization.  The Product Options app lets you do things like charge an additional fee for personalization.  And use conditional logic during the personalization process.  That could work something like this.  If the customer selects yes for personalization, then they get to pick between a Monogram option or two lines of text.  If they choose two lines of text, then two input boxes are shown for the two lines of text.  The app also allows customers to upload files with their orders for full custom designs.  The app cost $10 / month for it basic level.  And $20 / month for Premium which gives you adjustable prices and conditional logic.
3. And the third solution is visualization apps, which allow the customer to see exactly what their personalization will look like on the product including text layout, font and color choices.  Any visualization app is going to be a bit complex to set-up and will take some time and energy.
   
   When choosing a visualization app, an important decision factor will be what file format you need the output in.  Products that get printed like cards or dye-sublimation on shirts can use an image file like a PNG.  And these are easier to create, so there's several apps in the Shopify app store that offer that.  I do think that many of the apps out there use too much of the blank canvas approach that allows the customer to create their own design.  As I mentioned earlier, while the blank canvas does sound great, it is a conversion killer.  That said, you should be able to find one of these apps in the Shopify app store that can work for you.  And they are rapidly innovating, so I won't recommend a specific one here.
   
   Now if your personalization is done on a laser engraver, vinyl cutter or similar machine, you'll need a vector file like an SVG.  That's what our Product Configurator software outputs.  In fact the SVG file we produce can be taken straight to the laser engraver or whatever machine you are using without editing.  Our app is more complex than can be handled in the Shopify app store, so you can't download it there.  I've included a link in the show notes to an information page.  I do want to point that our Product Configurator app is fully responsive and one of the rare visualization apps that work well on mobile.

So, with all of that information, let me summarize for you how to determine if you should offer personalized products.

1. Is your product right for personalization?  Many products are.  In fact, a surprising number of products can be and are personalized today.  There's the obvious jewelry, gifts, and everyday carry items.  But then there's also things like skateboards, guitar picks, and gear shift knobs.  But if you are selling something like spark plugs or ceiling fans then personalization might not be right for your products.
2. Are you doing fulfillment?  You'll most likely need to do the personalization in house.  So if you are using a drop shipper, 3PL or Amazon fulfillment, personalization may not be an option for you.
3. Are you ready and willing to take on the personalization operations?  There's machines to buy, floor space needed, skills to learn, quality assurance processes to implement and more.  Are you ready for all of that?  Do you want to do all of that?

If you answer yes to all of these questions, then consider product personalization.  It will increase your product's appeal and increase your revenue and profit.  If you any questions on if personalization is right for you, feel free to reach out to me at scott@jadepuma.com.

Thanks for listening.