We’re going to talk about choice overload, why offering too many choices to customers is a bad thing, and what you should do instead.
Businessman and futurist Alvin Toffler first introduced the concept of choice overload in his book Future Shock (1970). The premise is that living in the post-industrial age (translate: TODAY!) means that we are faced with many choices—far more choices than even two decades ago.
How do we make choices?
Psychology professor Barry Schwartz summarizes the framework of decision-making in his book, The Paradox of Choice:
1) Identify your goals
2) Assess the significance of each goal
3) Organize the options according to how well they meet each goal
4) Figure out how likely each of the options is to meet your goals
5) Choose the best option
There are two types of decision-makers: Those who spend some time considering their options and are satisfied when something mostly meets their criteria, and those who can’t choose something until they’ve deeply examined every possibility in existence.
Offering lots of options may not be the best idea.
Freedom of choice is a good thing, right? But having too many overloads our brain and paralyzes us from making a decision.
Columbia University conducted a study where a research team set up a booth of jam samples. Every few hours, they would switch from a selection of 24 jams to a group of six. When there were 24 jams, 60% of customers would stop to get a sample, while 3% would buy a jar. When there were six jams on display, only 40% stopped, but 30% bought jam. Lots of options attracted customers to browse, but fewer choices got them to buy.
The more options we’re faced with, the more likely we are to experience unhappiness, decision fatigue, decision paralysis (avoiding making a decision altogether), anxiousness, regret, and decreased satisfaction with the option they do choose.
As Schwartz explains, “The existence of multiple alternatives makes it easy for us to imagine alternatives that don’t exist — alternatives that combine the attractive features of the ones that do exist. And to the extent that we engage our imaginations in this way, we will be even less satisfied with the alternative we end up choosing. So, once again, a greater variety of choices actually makes us feel worse.”
How do companies manage choice overload?
Target makes it easy by carefully curating the wares on their shelves. They have thousands upon thousands of amazing products, but they don’t offer them up to you all at once. There are carefully selected spots, and they don’t fill racks to the brim because that’s visually overwhelming. There are probably one or two styles of clothing on a single rack. Their displays are designed to draw customers in and to encourage them to pick up and inspect the product. There’s always just enough product to pique interest and make you want to see more. Ever wonder why a Target run can take so long?
Proctor and Gamble found that when they decreased the number of Head & Shoulders shampoo varieties available to purchase, revenue increased by 10%. It can be hard to differentiate between very similar niche products, so taking away some of the options made the remaining ones easier to compare.
Squarespace has four plans to choose from on its website. Each subscription plan’s features can be complicated to weigh, so they made a chart that compares what you get with each subscription option. It’s pleasing to look at and simple to read, making the deciding process a lot more bearable.
Companies like jewelry stores and car dealerships often have a comparison tool on their websites that lets you select your top three choices, see them next to each other, and closely examine their features and benefits. This process is much more user-friendly than making your customers go back and forth between web pages.
Netflix has an option that pops up after it detects that you’ve been scrolling for a while that offers to choose a show for you. They do their best to categorize their material so you can narrow down what you want to watch, but we all know the difficulty of making that final commitment.
AirBnB’s website gives you multiple chances to narrow your search by choosing preferred features in small batches, ensuring that you’re only presented with options that are the best fit for your needs.
On DoorDash’s website, the first thing you see is a section of featured restaurants. Suppose scrolling through every restaurant available is overwhelming for you. In that case, this collection makes deciding easier because the agonizing work of determining which places are above average has already been done for you. When you choose a restaurant, they start by listing the featured and most popular items so that you don’t need to sift through the entire menu if you don’t want to.
What should small businesses be doing?
Remember that giving lots of options comes with good intentions, but it can backfire on your business. You don’t want to scare off potential customers by overwhelming them. Plus, you don’t want your brand to be associated with stressful feelings from choice overload.
The best thing you can do to ease the anxiety of decision-making for your audience is to offer only the necessary number of options and make it as easy as possible to compare their features. Keep the design simple and highlight specific benefits that would appeal to your customers.
As a consumer yourself, you know and understand what your customers go through when faced with too many choices. Empathize with their distress and show your compassion through your messaging and marketing. Your efforts will not go unnoticed!
How about you? How do you make choice-making easy for your customers? Got a question? Don’t forget to COMMENT below and SHARE your thoughts.