To Collect or to Purchase? Collaboration Between Manufacturer and E-Commerce Platform on Customization

More manufacturers are combining novel customer-to-manufacturer (C2M) with traditional make-to-order (MTO) customization to deliver tailored products. However, they face a critical choice between collecting data independently and purchasing data-driven insights from e-commerce platforms. This key decision remains ambiguous in practice and understudied in the information systems literature, with little rigorous analysis on data acquisition ways and their interaction with hybrid customization. This study addresses this gap by investigating firms’ data acquisition strategies in the context of hybrid customization. We find that when the marginal cost of data acquisition is high for both the manufacturer and the e-commerce platform, and customers have a stronger bias against tailored products, the manufacturer should still prefer collecting market data independently rather than purchasing data-driven insights. The e-commerce platform should not always provide insight support. Moreover, manufacturer-collected C2M may sometimes lead to a higher effort level of acquiring informative data and more customer welfare than platform-initiated C2M. These results provide valuable guidelines to manufacturers on choosing an appropriate data acquisition way, to e-commerce platforms on offering data-driven insights, and to policymakers on improving customer welfare. These results also contribute to the emerging literature in IS and related disciplines on data-driven production models.