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Question about color options for armor and clothing.

Lets say you have a multiplayer game where players can choose the color of their clothing. Is it better to have one material for each color, or is it possible to use the same material for the mesh and have a different texture load for each instance of the mesh.

Could we be wearing the same outfit with the same material, but mine be using a blue texture and yours be using a red texture? or do you need a separate material for each color.