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Abstract

Customers frequently gravitate toward unique products, and firms increasingly utilize mass customization strategies allowing customers to self-customize products according to their unique preferences. While existing research shows that customers are willing to pay extra for this uniqueness, the present investigation points to a potential cost of self-customization that has been largely overlooked thus far. Specifically, the authors argue that what creates value for the individual consumer-designer (i.e., the original customer of the self-customized product) might conversely be detrimental to potential customers on the second-hand market, particularly in the context of aesthetic (vs. functional) customization. Results of three distinct data sets (including an analysis of more than 500,000 pre-owned car sales listings) support this uniqueness-hurts-resale hypothesis and provide a series of more nuanced findings. Consistent with the theorizing and empirical studies, three follow-up experiments show that while consumer-designers’ valuations are positively affected by uniqueness, uniqueness indeed negatively affects second-hand market customers’ willingness-to-pay. This is because the more unique a given configuration to a given consumer-designer, the lower the likelihood that said design will meet second-hand market customers’ taste preferences. The findings point to a tension between maximizing utility at first purchase and minimizing the related cost of aesthetic customization at resale.

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