One month ago I finished my research on customization in the Internet economy. In this thesis I deal with the question how to support customization and personalization for pure digital products in the Internet economy to dramatically decrease search costs for consumers, so variety can be maximized. This thesis builds upon theories about digital products, mass customization and variety. These three themes have some relations that uncover a gap in literature. In this thesis I developed hypotheses based on these relations, and tested them empirically. The hypotheses are: larger variety enables higher levels of customization, higher levels of customization leads to larger possible variety, larger variety leads to more complexity and more complexity leads to higher search costs for consumers, and higher levels of customization leads to lower search costs for consumers.

Main findings:

• Instead of lowering the average interaction length of time (as suggested often in the literature), it may be desirable to increase the average interaction length of time between the supplier and the consumer.
• Instead of lowering search costs for consumers, it is desired for them to discover as much as new products as possible.

The thesis also stresses the “theory” of the long tail, where abundance of information is something to strive for, benefiting users. But this abundance needs useful customization possibilities to minimize the search costs for consumers.

Download the complete thesis on my weblog.