In a commercial sense, retailers, advertisers and marketers all but dedicate their working lives to giving people more choices, more options, more things to buy.
Intuitively, we think that giving customers a greater choice will mean that they’re more likely to find — and buy — precisely what they’re looking for. However, research into the decision-making process has found that the human mind is poorly equipped to deal with an extensive array of options. Instead, our minds become quickly overwhelmed, often resulting in us making the simplest choice of all: we choose nothing and walk away.
This brings us to the behavioural science concept of the choice paradox: while we love the idea of having choices, yet we are quickly overwhelmed by having to choose.
In 2000, psychologists Sheena Iyengar from Columbia University and Mark Lepper from Stanford University released their findings of the Jam Study, which has become one of the most famous experiments in consumer psychology.
To test the human desire for choice, the researchers set up a jam-tasting table at high-end Californian supermarket Draeger’s Market and posed as employees. The store prides itself on its extraordinarily great range of products. It offers 250 different mustard varieties, 75 different olive oil types, and more than 300 jams.
The psychologists’ tasting table featured Wilkin & Sons’ jams, purveyors to Her Majesty the Queen, no less. On the first weekend, they offered six exotic varieties of different flavoured jams, which saw 40 per cent of shoppers stop by for a sample, and 30 per cent go on to make a purchase. Pretty good.
The following weekend, at the same table, they set up 24 varieties of jam. Incredibly, the new display resulted in 60 per cent of shoppers stopping by for a sample (a 50 per cent increase on the previous week). However, when it came to conversion, only three per cent went on to buy.
The research was conclusive. Fewer choices meant more sales.
That’s not what we’d expected, so it’s worth asking, what’s going on deep inside our brains? Overanalysing options engages the slow thinking part of our brain, known as the prefrontal cortex. This area, sitting in just behind our forehead and taking up about 12 per cent of our total brain mass, is the home of rational thought. Its very existence is one of the most meaningful differentiators between our brain and the brains of every other animal on the planet.
Engaging our prefrontal cortex requires a lot of brainpower, which is why we subconsciously avoid doing it most of the time. Instead, we make the vast majority of autopilot choices, relying on the more primal, less resource-hungry reptilian part of our brain.
Surprisingly, it takes a great deal of mental energy to calculate which new flavoured jam you will choose, especially when there are 23 others to compare. When we consider that making a well-optimised jam decision is pretty unimportant for most of us, it’s easy to see how the choice gets filed in the too-hard basket, rather than the shopping basket.
This is why we’re inclined to purchase our regular brand of toothpaste, for as long as they continue making it. Reaching for old faithful means our brain doesn’t have to endure the mental friction that comes with working out if we’re better off getting extra whitening, ultra-fresh breath, tartar control, tartar control plus ultra-fresh breath, or baking soda. Instead, we get to lazily think, “I bought this brand last time, and I’m still alive. Good result. Let’s get it again.”
It’s important to remember that while we’re not very good at handling choice, we absolutely want to feel like we have plenty of it. This means that our focus needs to be on helping customers navigate a range of options more easily, rather than just limiting what’s available.
One way to do this is to plug into built-in, subconscious biases that help people reduce their cognitive load.
One of these is called the default bias, and I discovered it as a 15-year-old working at McDonald’s. As part of the business’ globally renowned training program, I learnt that when a customer asked for a Big Mac meal, the only correct response was “Is that a large?” Thanks to the default bias, most customers simply said yes, knowing that this was far less taxing than actually working out how hungry they were or how much they really wanted to spend on a burger and fries.
Studies have consistently demonstrated that when we’re offered a reasonable default option, we tend to take it. Even if it’s not objectively the best choice for us, we’d prefer to take the chance than waste our limited mental energy on something as trivial as a meal deal.
A classic example of this comes when we’re looking for a new broadband plan. Suppliers will often highlight a suggested or recommended option, knowing that even something as subtle as a call-out is enough to tip many of us over the line.
The authority bias is another heuristic we can tap into to help ease our customers’ burden of choice. Here, we lean into others’ opinions, specifically, those of (perceived or actual) authority figures to help one option stand out. Whether that comes in the form of a celebrity-endorsements, testimonials from an expert, awards and recognition, or even staff picks, the impact is the same. We’re more likely to buy when somebody we respect, admire or has authority tells us that they’ve already vetted all of the options and chosen one. In essence, we divest our responsibility for making the ideal choice onto somebody else.
This leads us nicely to a third bias known as social proof. If we have a product or service to sell, it’s critical to find interesting or creative ways to show the person we’re trying to sell to that lots of other people just like them have already bought it and are thrilled to have done so. Social proof is what causes us to line up outside full restaurants and bars while empty ones across the street longingly wait for us. The safety and certainty that come with making an easy, popular choice are hard for our reptilian brains to resist.
Ultimately the best retailer can demonstrate the breadth of offering that customers think they want while making it quick and easy to narrow down to a handful of viable options. As the great jam experiment of 2000 revealed, having more options is great for drawing people in, but we need to quickly shrink this down to a manageable number if we’re going to convert, which at the end of the day is what it’s all about.
Behavioural science expert Dan Monheit is co-founder and strategy director of creative agency Hardhat. His behavioural economics podcast, Bad Decisions, attracts many thousands of listeners in over 90 countries.