I would love to see players around me express their own personality through the game, which is one of the core part of an mmo. The customization is also a big part of the overall feeling you get when playing.
My issue with the customization in this game is that:
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Everybody looks the same. All the factions gear looks exactly the same so everybody looks the same if it’s using that gear, which is already a very high slice of population. Yes you can dye it but few people do it because it requires gathering farming to create the dyes and as well a decent level of cooking so why bother.
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Skins in the shop are ok but again, same issue but worse. In this case, players CAN’T even dye these skins. So 10 people around you looks exactly the same as you. That’s not cool at all and in all honesty prevents me to buy them cause I don’t wanna look exactly the same as others around me without any kind of customization possible.
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There are some Armor and Weapons models in the world which are amazing but maybe they are low level or not very good in term of gameplay. But again, we can’t use them as cosmetics. Why? Cause we have only two options: either we put on a skin from the shop like other thousands of people have the exact same one, or we use the best gear possible which is also what every other person in the server is doing, so the result is the same.
TLTR: There’s not enough variety in terms of cosmetics items and a lot of beautiful models that you may aesthetically like from lower levels are useless cause you can’t transmog them. So we are forced to all look the same.
EDIT: If the issue is that you want people in PvP to recognize the type of enemy they are facing, just make transmog available for the same type of gear (Es: medium only with medium, Axe only with Axe). But at least in this way you could open a ton of variety and make the game less boring in terms of character aesthetic.