Customized SMS enables you to create replaceable parameters through which the message content will be sent customer wise. This will enable you to create a single template and send SMS to large base of users with replaceable content.
E.g:
Dear <XYZ>,
Your account balance is <XXXXX> as on <date>
Where as the parameters mentioned in the <> are replaceable.
You can also read our more on Customized Messages here.