Understanding consumer behaviour: less is more
by Kirsten Dugmore. We assume that if we offer our customers more choice, they’ll be more likely to buy our products since they can more easily find what they’re looking for.Wednesday, 01 Jul 2020
by Kirsten Dugmore. We assume that if we offer our customers more choice, they’ll be more likely to buy our products since they can (theoretically) more easily find what they’re looking for. Have you ever experienced a child under five in the sweet aisle? If you have, you know that if you tell that small human that they can have any sweet they want… you might as well pitch a tent, because you’ll be there a while.
The child’s decision will be a drawn out and exhausting process for all involved. As the adult, after a few minutes you will instinctively narrow the decision down for them: “How about Smarties or NikNaks?”. Or if you’ve ever found yourself staring at a lengthy restaurant menu and been completely unable to decide what to order for dinner, you have experienced what psychologists call ‘choice overload’. The brain, faced with an overwhelming number of similar options, struggles to make a decision… similar to that kid in the sweetie aisle.
But here’s the paradox of choice: if a person is presented with too many choices, he or she is actually less likely to buy. Thanks to Behavioural Economics, we know that we have a select number of cognitive resources, which are tools your brain uses to process information. As humans, we are wired to use as little cognitive effort as possible (thanks to Daniel Kahneman, we call this System 1).
Our brains use heuristics (i.e., mental shortcuts) to try and minimise the decision-making effort and avoid mental overload (working too hard). So, when a task (such as making a choice) takes up an increased amount of resource, it becomes exhausting – and we may choose to avoid making a decision at all.
However, more often than not, many of us will just give up if something takes too much effort. Especially when it comes to finding a specific product (rather than just by browsing) in a large, illogical, or complex assortment, the threat of choice paralysis is imminent. This is a major shift in the belief that customers want and seek more choice and that the more we can offer our consumers the better. This premise is in fact not true in many instances.
In 2000, psychologists Sheena Iyengar and Mark Lepper from Columbia and Stanford University published a study about jams. On a regular day at a local food market, people would find a display table with 24 different kinds of jams. Then on another day, at that same food market, people were given only six different types of jam choices. It turned out that although shoppers were more likely to stop and try samples when the table was jam-packed, they also were much less likely to actually purchase any jam. Shoppers were somewhat less likely to stop at the table when it had only six jams, but when they did, they were 10 times more likely to make a purchase than the customers at the fuller table.
Too much choice paralyses the consumer! Let’s take it a step further. Shoppers with preference uncertainty or that are unfamiliar with a category are more likely to suffer from choice overload. Think of a category you don’t buy often (recently for me it was men’s cologne for Father’s Day… I felt very overwhelmed). These effects are reversed when someone is an expert in a product category or has clear and articulated preferences for a variation of a product (like your regular toothpaste).
When it comes to selling your products, whether it be online or in-store, it’s important to try and reduce the mental strain as much as possible for your shoppers.
Kirsten Dugmore is Chief Growth Officer of SugaSpice. She will be hosting an online ‘Modern Marketing Bootcamp’ that will bring together a body of evidence-based thinking in one workshop. It will equip delegates with the latest, proven principles for effective communication and brand health. The course will be held online via Zoom conferencing from 7 to 30 July 2020.
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