Whether it's microbrew beer, whitening toothpaste, or car insurance, one thing is for certain: the American consumer is bombarded with choices. Research shows that while having choices might be appealing, too much of a good thing can be a problem.
An article in The New York Times explains the choice conundrum through a well-known study of one particular product: jam.* Researchers studied the power of choice by offering free jam samples at a supermarket. When the researchers offered more sample choices, more people stopped at the table, but fewer of them actually bought anything. When the number of choices was reduced, fewer people came to the table, but they were more likely to buy something.
Researchers concluded that people are drawn to having lots of choices, but too many choices can induce decision paralysis.
Businesses need to look for ways to draw people in without freezing them up with too many options. One way is through better information. Customers are more likely to feel overloaded by choices when they don't really understand the product. The more information they have, the more comfortable they are making a pick.
The research also shows that too many choices leads people to feeling less satisfied with their choice. Businesses need to identify what sort of product they are offering and attune their choices to the market.
If you're not quite satisfied with a soda flavor and wondering if another might be better, you might try a different flavor from the same company—sparking more sales. But if you're not quite satisfied with your phone carrier plan, you might become frustrated with the phone company and switch carriers altogether.
Sometimes it even helps to take the choice out of the customer's hands with a default option, letting the customers decide if they even want to make a choice.
Understanding the process a customer goes through when making a choice can help a business better design its product offerings.
*Tugend, A., Too Many Choices: A Problem That Can Paralyze, The New York Times, on the internet at www.nytimes.com/2010/02/27/your-money/27shortcuts.html?_r=0%20.