It’s been long established in marketing research circles that the more choices you give a consumer, the less likely he or she is to decide on one.
Sheena Iyengar, a professor at Columbia Business School and author of The Art of Choosing, addressed a roomful of marketers at BRITE ‘11 about how to navigate the problem. Her work has implications for selling anything online or offline.
The paradox of information overload on smart purchase and decision-making also gets front-and-center attention this week in Newsweek.
The article goes over the territory from a slightly different angle examining what happens when Twitter, Facebook, apps and the internet make it possible to research something virtually forever and still make a bad choice when last-minute info is thrown at you from left field.
Seems the more you know about certain topics, the less likely you are to make a decision you find satisfactory. And the brain literally shuts down its intuitive unconscious guidance system when information just keeps coming.
Columbia’s Iyengar and her colleagues found way back in 2004 that participation in 401(k) plans dropped from 75% to 70% as the number of choices rose from two to 11. It fell another 9% when 59 options were presented. Those who did participate, chose plans with lower returns. In an online store, Iyengar found shoppers given 50 rather than 10 options chose lower-quality options.
Beyond the magical number of 7, the mind is not able to keep track of things. So too many choices decreases:
- Commitment (the willingness to make a choice and stick to it)
- Decision quality (doing things that are actually counter to what you believe)
- Satisfaction (less confidence in the choice made being the best choice)
One area where this rule does not apply is with experts. An expert can properly prioritize and see order. Mastery of the subject allows an expert to zero in on the most relevant option and eliminate the distraction of the unimportant. In a sweeping understatement, Iyengar says:
“Most of us aren’t experts in everything. We say we want more choices because we want the opportunity to find the perfect choice. But in reality, what we really want is a great choosing experience. To have the confidence in our preferences. To feel competent rather than questioning ourselves, 'Did I really get it right ?' ”
OK. So how does a marketer improve the experience?
Cut
Lots of times people are worried about cutting options. Careful trimming can increase sales, lower costs and improve the choosing experience. One online grocer reduced choices by 54% and saw an increase in sales of 11%.
How do you know you have too many choices? Not only can't customers differentiate the choices; your employees can’t either.
Categorize
What experts do is categorize the options to make it easy to figure out. Merchants can help the novice shopper by categorizing in an understandable way.
Best Cellars displayed the 100 best value wines and divided them into eight easy-to-understand categories. Customer feels good. Knows why they chose it. Can show off knowledge of the bottle of wine.
When categorizing, pay careful attention to the name you give the categories. Jewelry collection names like Jazz and Swing might appeal to the creator but are useless to the chooser.
Condition
We can’t handle more complexity and choice than we're able. Throw a shopper into the deep end and only a handful will be able to get to a decision.
Iyengar’s research shows that walking the shopper from shallow information into the deeper end in a methodical way allows that shopper to handle more information on their own terms and leads to a more satisfying experience.
This is more likely to result in a purchase. (And no car maker needs to offer 56 color options as one German automaker she studied did.)
So with this research well-publicized why do marketers still feed the problem?
The way you make it into the news is by talking about new sets of options. That’s what gets people in the door. At least that's Iyengar's theory.
I’d write more on this topic, but it's time to resume agonizing with my child over which high school is the right one for her to attend.
What's your experience been with information overload and making choices?
Reader comments (9)
5:52AM on 7th March 2011
In the beginning my mind was resisting the idea that you should have less variety to increase your sales. I was thinking that customers asks for variety and if you will not provide it he or she will never give you time to hear Iyengar’s research but somehow she is right, specially the ideas of displaying your items categorically so your customer will never get confused about the lot of choices he need to made.
Director at WSI Yorkshire
9:45AM on 7th March 2011
Absolutely, this is at the heart of landing page theory and conversion architecture. Keep it Simple, choice can simply open up more questions and therefore reasons not to buy or to go away and research some more..
General Manager at Cognitive Match
10:09AM on 7th March 2011
In my previous role I was working for one of the well known multivariable testing companies, it was a common theme for testing to prove that less is more.
One way you can have less options and have choice is through the assistance of targeting engines. Working with a larger choice of options, then engine can attempt to show the right option to the right visitor profile.
Head of Client Services at Walker Agency
10:21AM on 7th March 2011
Completely agree with this article, as it mirrors our findings across a variety of different platforms.
Simplicity is the key to improving conversion/sales. Keep the proposition focused, the call to action clear, and try not to overload the consumer with too many supporting messages and additional offers.
5:32PM on 8th March 2011
Yeah, I saw a special that Johnson and Johnson had reduced the number of toothpaste brands and sales had gone up because consumers were less confused.
I was at a lecture yesterday and they said we can only process 7 +/- 2 items at once.
6:58PM on 8th March 2011
So True! The more I think about it, I have left a site because it was too confusing, or I simply got Lost in it.
I have recently started marketing and was just thinking about how much choice I need. Glad this came up before I got carried away. It does actually makes sense.
Cheers, good stuff!
11:39PM on 9th March 2011
What a perfect article for my own situation as an Online Marketer. I love to provide choices, but I had a feeling it would defeat the purpose. Your article is a reminder that less is really more, when it comes to getting that sale.
10:14AM on 12th March 2011
Capitalism's commodification of information has led to crippling information overload, much of which is redundant information. I think with so many messages out there, it's a case of who do you believe.
It's interesting that less is more in terms of choices and interesting to note that 7 is the magical number. Decision making is often influenced by what is presented by new media, such as Google search results. I have often been influenced by people's reviews on Trip Advisor for example or at least after some time researching, these reviews have corroborated my opinion. It's probably a simplistic view, but with more and more user generated content including 'less biased' reviews, this surely aids decision making. Knowledge is power!
10:22AM on 18th May 2011
I feel that people sometimes over analyse landing pages and risk confusing the visitor. When I visit a web site I want to be presented with clear information in a quick and simple way...
Very interesting comment about the toothpaste - reducing the range to confuse people less!
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