Christian and Sonya raised an interesting conundrum with their question in reply to my last post. “In a category like breakfast cereal, are the manufacturers hurting themselves by having so many brands and varieties within those brands?” There are two aspects to this from a retail marketing and consumer behaviour perspective. The brands are doing themselves a favour (with an approach that was started by the cigarette manufacturers many decades ago): by proliferating the number of brand options you increase the likelihood that someone will choose one of your brands (and they basically don’t care which the customer takes so long as it’s one of theirs). This makes it much, much harder for a new entrant to take market share away. The retailers however are not helping their cause. It’s been found in one study of European supermarkets, that those who stock a smaller ranges sell more in total than those that stock […]
Too Much Choice: Part III
When faced with a small choice consumers can deploy simple strategies to make a choice and feel better about the option they choose. Three options usually works well because customers can use extremeness aversion. By selecting the middle option they know that they don’t have the worst that they might, but nor have they been indulgent and spent more than they might. The options present frame the choice; put another way, they way in which the decision is made is largely a by-product of what has been presented to the customer at the time he or she is making the choice. We’d all like to believe that what we’re buying is the thing we would want to buy in considering our own “needs” (and indeed marketers often talk about “consumer needs” as if such a thing were tangible and real. It isn’t. The human (and consumer) mind reacts to its […]
Too Much Choice: Part II
Whilst the idea that more choice is a ‘bad thing’ can feel counter-intuitive at times, it’s not hard to demonstrate. Imagine that you had to select a blog from a selection of twenty or so to follow for the next year, but that you could only choose one. You’d better pick well because you’re going to be stuck with it for a while! And don’t dwell too long on what you might be missing out on from the others that you don’t choose! On the other hand, what if there were just three to choose from? The chances are that even if you liked two you would find that selection process far, far easier. The key issues affecting consumers (and anyone else) when making a choice from a number of alternatives are: The absolute number of alternatives: however simple the choice, having to screen and mentally juggle a large number […]
Too Much Choice
Following on from my post yesterday I thought I’d go into a bit more detail on the problem of choice, from a consumer perspective. Choice is attractive. Tell people that you have lots of alternatives and, for the most part, they will be more inclined to come to you. From this perspective more choice is better. But that’s not the whole story. Once consumers arrive and are required to actually make a choice, more options can lead to confusion (congnitive dissonance). That confusion can take several forms: Difficulty choosing between similar options. Difficulty selecting any one option as the better. Confusion over which product variable or attribute to attach most importance to. Anxiety about how they will feel about a choice they’re inclined towards, knowing that a particular (and also attractive) alternative was available at the time they chose. Customers may simply run out of energy (studies show cognitive processes burn […]
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