Before anything let us go a few years back and recollect the moment when we had to buy our first mobile phone. Such an ‘important’ decision of our life as this was going to stick with us ever as “OUR FIRST MOBILE PHONE”. We had limited specific requirements except for the budget constraints and so there were a few phones falling in our range and we bought one of those. Easy process, wasn’t it? Not so much today! With innumerous phones falling in every set of requirements and budget constraints you would believe that the process would have become easier since we could choose just the perfect phone for us but unfortunately if you delve deeper you would realise that is not the case. In fact, a research suggests “almost 53% people dislike when they have to choose from amongst too many options”. This is what raises the topic of Tyranny of Choice or popularly called Paradox of Choice.
So, what is this “Paradox of Choice” or “Tyranny of Choice”? There is a common belief about decision making that having more choices is a good thing and makes decision making easier. However, it has been observed that whenever a person has more choices to choose from, the chances that he will actually make a choice decrease and also the level of satisfaction obtained from each choice also reduce. In simple terms, Tyranny of Choice is explained as "when the number of choices we have increases, the level of psychological satisfaction we derive decreases and the negative effects of each choice start appearing”.
In fact, Sheena S. Iyenger, one of the early adopters who popularised the paradox of choice, ran an experiment using the above-mentioned concept. She set up a ‘Free Sample’ table at a grocery store serving various flavours of jams.
During the first phase of the experiment, she offered 6 flavours to choose from.
During the second phase, she offered 24 flavours.
The following observations were made:
When 24 flavours were offered, only 3% of samplers converted and made a purchase while when only 6 flavours were presented, 30% of shoppers made a purchase. When fewer options were offered, it resulted in 10x the number of sales!
WHAT IS THE PARADOX OF CHOICE? This explains the Tyranny of Choices and this has huge impacts on the marketing styles of various companies and explains various success and failure stories of huge brands.
There have been several experiments to prove the theory of Paradox of Choice. Several experiments by several psychologists have all resulted in two biggest reasons of the phenomenon:-
a) One of the biggest reasons for this is that too many choices generally leave the person tired and irritated and he chooses to make the selection tomorrow, which seldom comes. If we look at it, this would have happened to you as well as a customer. Just remember the time when you went online on Amazon (certainly not marketing the site) to buy a dress with 89,662 choices or shoes with even more 1,15,442 choices and you just could not decide and closed the site. This is what happens when there are too many choices we like the fact per se but do not take make the purchase.
b) As it is rightly said, “With too many choices come too high expectations!” This is another big reason why too many choices result is fewer actions. When we have many choices to choose from we expect that the choice we make will certainly give us the immense pleasure and in the Fear of Missing Out that pleasure we tend to avoid making the choice and hence again too many choices result in lesser actions. Another conclusion through all these experiments was that seven (plus-minus two) is the right number of options that a customer wants to choose from and with every extra option the satisfaction that he would derive from choosing one decreases but obviously to a certain limit beyond which it ceases to decrease.
The paradox plays one of the most important roles when it comes to marketing. As a manufacturer, the company needs to ensure that it gives the consumer the right number of options to choose from, which not only gives them the freedom to choose but also does not avoid making a choice at all. This has become a thing to ponder upon for both online and offline sales. Online e-commerce websites give thousands of options for each product and then there are innumerous websites to order from with each website providing its own merits and demerits that it becomes such a hectic task for the consumer that he sometimes skips it completely to go and buy from the nearest supermarket. For offline sales again the supermarkets like Big Bazaar sometimes put up so many options ranging at such a huge price range that it becomes practically impossible for a person to make the right decision that he decides to skip it and this time go to the nearest retail outlet and buy the one which the shopkeeper will get from the shelves. One simple example of how too many choices affect the decision making of a customer is the mobile industry. Today there are several companies giving you hundreds of mobile phones with thousands of different features, you can choose from amongst different colours, sizes, memory, screen, resolution and numerous other features. Then there comes different flash sales with one coming today another tomorrow then again next Friday and all this just increases the confusion in the minds of the consumers. This is where Apple eases out things for the consumers. Except for their IPad2 which had different variations of size, colour and connectivity, Apple ensures the least confusion for its customers where they only have to choose from amongst different sizes and colours keeping the total options closest to the magic number 7 we discussed earlier. The image on the right shows how easy Apple makes it for its customers to choose a product from their site with just 2 colour options and 3 memory options for each.
Another infamous example is the “Switch Off” option on the old Windows Vista. From the start menu, there were a staggering 9 different options that you could choose from. Nine different options just to shut down your computer! That’s too much! This was the reason that in the later versions only 4 classic options were given and rest all removed. Another very popular example of having too many choices working against the company is the case of Lays potato chips in United States. This happened when Pepsico, in a bid to capture the food market kept on launching newer flavours of Lays and had reached to about staggering thirty-nine flavours. This in the starting went well for the company as everyone had some or the other option to try but then soon the sales dipped as the consumers didn’t know which one to buy and also the retailers could not anticipate which one to fill their shelves with and as a result Lays had to change their strategy. They soon stopped a few flavours postmarket research. The image below shows the different flavours that were circulating in the United States market at one particular moment of time. It had become highly confusing not only for the consumers but also the retailers and shopkeepers to decide which one to keep and which one to not.
There are several lessons that one could take from the above understanding in order to ensure that one is not giving too many options to its customers. Let us look at some of them:-
1) Keep efficient filtering options if yours is an online store. It is very common to give thousands of results whenever a consumer searches for a product but proper and efficient filtering options is what will keep the customer stick to your site even after getting those many search results. Amazon really does well here by giving the Advanced Filter option that helps to have subcategory filters.
2) If yours is an offline store, ensure you do not keep too many options for the same product as that would discourage the consumer to choose one. Keep the ones that would sell the most and certainly, you will have higher sales than what you will have by keeping more options.
3) If you’re a blogger and want users to share your post or blog then keep only a few effective sharing options rather than keeping all that you can think of under the sun. There are various examples where bloggers had every option ranging from Facebook, Twitter, Pinterest, Instagram and users just did not use any. Rather keep a couple of them and wait for the results.
At this point, we clearly get it. Choices are hard and though there are a few decisions which can never be made easy, any marketers aim is to encourage its consumers to buy more and decide less. After all, at the end of the day, most of the purchase decisions are made impulsively and any marketer would not want its customers to be lost to its competitor just because of too many choices. So a right set-up and creatively tailored shopping experience is indispensable to set your customers free from the burden of choice and make decisions rationally and not after being tired of all the choices that they get in any market.