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  • Writer's pictureThomas Schoenbeck

The Paradox of Choice

Contributing writer: Thomas Schoenbeck

"Consumers get easily overwhelmed and often opt for making no purchase due to being overloaded or becoming bored with browsing."

Most of us are of the firm belief the more choices we have, the better off we'll be. If for example, we are searching for a new car. We like a certain brand auto and maybe desire a certain style such as coupe verses sedan. So, we either go on the web in search or visit a car dealership in person. We experience the plethora of available models, but often times end up not making a purchase. Or perhaps we are searching for a new pair of jeans on line. We know we like a certain manufacturer's product line, so we diligently search through websites that offer those particular jeans brands. We click on the link and open up a search page that can show us hundreds of jeans, but many times simply bypass the purchasing experience all together. But then we go to our local mom and pop grocery store looking for, let's say, peanut butter. The shelf has two or three brands on the shelf; smooth, chunky, natural etc. We select one of them and head for the cashier. Why the disparity in purchasing verses not purchasing?

It turns out, more is not always better for the consumer. Too many options can lead to what's psychologically referred to as the Paradox of Choice. Have you ever dined in a restaurant and wanted a glass of wine with your meal? You look at the wine menu in search of a red, but because there are so many wines listed, and you have no idea what some of them are like, you either decide to by-pass the wine altogether, or you end up asking for whatever your favorite is, say a Malbec. The waitstaff tells you they don't have your particular wine, but offers you a red they do have that is complimentary. You either accept their offer, or decide you really don't want wine after all.

In 2000, a psychological study was conducted in an upscale Bay-area supermarket, Draeger’s Market. It was called the Jam Study. When people had a large variety of jams to select from, they were much more likely to browse. However, in the same study, when a consumer had fewer options, 1/4 the choices available, they were 90 percent more likely to actually make a purchase. This same study has been repeated over a variety of businesses and industries with the same results. Consumers get easily overwhelmed and often opt for making no purchase due to being overloaded or becoming bored with the browsing process.

So as a business owner, what can you do to possibly boost your sales? Analyze your model. Are you sending your consumers too many options at once? If your customers are acting like a deer in the headlights with what's referred to as Analysis Paralysis, perhaps you're putting too many items on their plate at one time leading them to make no decision.

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