'Custom' Is Customary
When David Galloway goes to bed at night, he rests on a mattress he designed himself, including its inner springs, a layer of latex, memory foam and label that unabashedly reads: "Where the Magic Happens."
The 27-year-old New Yorker paid around $1,250 for his custom cushion from Create-a-mattress.com, a Needham, Massachusetts, startup founded by former Dial-A-Mattress executive Evan Saks. Galloway is evidence of what some business-trend experts say is increasing consumer and entrepreneurial interest in customized goods, ranging from specially made toilet paper to one-of-a-kind pet food.
The economy may be a factor. While such items may cost more than their mass-produced counterparts, they're still generally less expensive than luxury goods, according to Jeremy Gutsche, founder of TrendHunter.com, an online magazine that covers a range of emerging trends. Cash-strapped consumers may be seeking feel-good alternatives to items they can no longer afford, he says.
More entrepreneurs may also be entering the space because of the minimal startup costs, says Rob Adler, an adjunct professor at Babson College. In most cases, custom businesses can operate exclusively online, he says, eschewing costs associated with leasing or buying a brick-and-mortar store.
Another advantage to starting a custom business: "We don't have to make anything in advance," says Nick LaCava, co-founder of Chocomize.com, one of at least two recently launched design-your-own-chocolate-bar businesses. (Chocri, a two-year-old Berlin-based startup, added a U.S. branch in January.)
Michael Charley, 23, ordered a blend of dark chocolate, edamame, beef jerky, cayenne pepper, oregano and Junior Mints from Chocomize last month. "I wanted something I can't find in a store," says the Philadelphia resident, who paid $8.65 for a 3.5-ounce bar. "It's surprisingly good, like a taste-bud safari."
Dace Ventures, an early-stage venture capital firm in Waltham, Massachusetts, has seen an increase in entrepreneurs seeking financing for custom businesses, according to Jon Chait, a partner. "We used to get a proposal from one new venture focused on customization out of thousands a year," he says of Dace, which is currently investing in Panraven Inc., a three-year-old custom photo-scrapbooking business in Cambridge, Massachusetts. "Now we see several per month. That's a major shift."
CustomMade.com, an online directory of custom home-furnishings businesses, currently has more than 1,000 listings, up from just 300 in 2009, says Seth Rosen, co-owner of the site. He projects that the businesses listed on CustomMade will earn a combined $20 million in revenues this year from consumers who find them on it, up from the $8 million they reported to have earned this way in 2009.
Customized goods appeal in particular to younger customers who have grown up with personalized ring tones, avatars and the like, businesses say. "It's almost a base expectation that a product should be tailored to one's personality," says Avery Pack, founder of RepublicBike.com, a custom bicycle manufacturer in Dania Beach, Florida. The two-year-old company's bikes, which cost between $400 and $500, come in three styles and up to 10 colors for parts such as tires, grips and saddles. "Nothing needs to match," says Pack. "Your front rim can be baby blue and your rear rim a crazy green."
Designing a product online from scratch is a highly interactive experience, something young consumers are used to, says Joshua Kace, co-founder of SlantShackJerky.com, a custom beef jerky business in Jersey City, New Jersey, that launched last month. Customers can choose from two types of beef, two marinades, four rubs and two glazes to create up to 60 combinations costing a minimum of $12.50 for a quarter pound. "We wanted to take something pretty simple and boring and add a level of excitement to it," says Kace, who has seven business partners.
Other companies have added custom products to their existing catalogs of mass-produced goods. HeroBuilders.com in Oxford, Connecticut, initially sold its handmade action figures only in the form of celebrities and politicians when it launched nine years ago. But customers later began requesting dolls made to look like themselves, family and friends, says Emil Vicale, founder of the nine-person business. "It was consumer-driven," he says, adding that single orders of custom dolls, which cost around $375, now average 500 a year.
Of course, consumers aren't always happy with the end result, and returns, though rare, generally go to waste. "We've had customers misspell their own child's name," says Mark Sarpa, co-founder of Frecklebox, a two-year-old maker of custom kids' products in Santa Clara, California. Its storybooks, for example, can feature a child's name on the cover and throughout the storyline.
Custom goods also tend to be more time-consuming and expensive to put together than ready-made items. "You're working on each individual order separately," says Adrian Salamunovic, co-founder of DNA11.com, a five-year-old business that creates artistic portraits of consumers' DNA, fingerprints and lips, starting at $200 each. Pets' DNA portraits are also for sale. "You can't just click a button and create 10,000 orders."
But Salamunovic says the extra effort is worthwhile; his 16-employee business generates more than $2 million in annual revenue. "People want to stand out in a world that's increasingly cookie cutter," he says. "And there's nothing more personal than your DNA."
Write to Sarah E. Needleman at email@example.com