One of the most alarming threats posed by the wide availability of pricing information is that products can become commodities. When customers can easily compare prices on the Internet, they tend to buy from the lowest-priced provider. This is a crisis that every executive should consider.

But companies that use the right technology can avoid commoditization. The solution is to mass-customize their offerings to satisfy the unique needs and desires of every customer.

For the most part, standardized products exist because they can be made less expensively than customized ones. And sometimes, the effort required by the customer to specify a custom product is not justified by any added value associated with having a custom product or service rather than a standard one.

However, the Internet, coupled with other information technology, is often making fully or partially customized products as inexpensive to manufacture as standardized products, while making them easy and fun to specify.

Since customers are often willing to pay more for such products, this seems like a clear formula for higher profits. Despite the fact that the idea has been around for longer than a decade, businesses are just now learning how to use this capability effectively. Those that do may gain another weapon they can use to regain some of the pricing power lost over the past decade.

To better understand this trend, let's take a look at what's going on, where it's headed, and what it might mean for your industry.

Consumers love being in control. Not only do they have pricing power, but they are gaining the power of choice — and they are willing to pay for it. As we've noted in past issues of Trends, the mass upper class is constantly seeking affordable luxuries. And, just as a custom-tailored suit is more luxurious than one purchased "off the rack," the same concept is behind a whole array of services and products that can now be mass-customized.

Customers can order their own blend of colored M&Ms, their own custom-designed golf clubs, and their own menu of premium cable television channels.

At Procter & Gamble's Web site, reflect.com, customers can select their ideal specs for such cosmetics as eye moisturizer. Similarly, shoppers who want to buy decorative candles are no longer limited to the selection on a store shelf; they can choose any...