The Origins of The Paradox of Choice
The Paradox of Choice was first described by psychologist Barry Schwartz. His theory, presented in the Harvard Business Review in June 2006, has since been discussed in classrooms, TED talks, and marketing conferences across the world. Many retailers believe that the more options customers have, the more likely they are to find something they love. However, customers face “choice paralysis” when given too many options, and often report lower levels of satisfaction with their overall purchase experience. This theory has been proven by office employees who were less likely to enroll in retirement plans when they found themselves overwhelmed with options, along with B2C customers who buy less when faced with too many choices.
Netflix Guides Customers Through Its Interfaces
For years, Netflix has struggled to overcome the “decision paralysis” that comes with Schwartz’s theory. Often, customers scroll through a handful of genres and dozens of movies before they decide which ones to watch. Even though customers can spend hours reading the different descriptions, many users often get frustrated by the choices in front of them. Customer frustration is one of the main reasons Netflix constantly strives to improve its recommendation engine to use better data and personalization techniques. If customers can find exactly what they want within a few minutes, their happiness will decrease. Additionally, Netflix has started limiting the window periods in which shows and movies are available so that the company can drive decision making and increase demand.
Amazon Virtually Eliminates Choice With Its Dash Buttons
Amazon’s Dash Buttons are forms of physical hardware linked to a particular SKU or product on Amazon. Customers can place their buttons next to household goods, such as pet food or paper towels, and then reorder the products when supplies run low. Amazon has millions of products on its website along with dozens of digital and brick-and-mortar locations to buy home essentials. Target and Walmart both have strong physical and online retail presences. Customers could easily get overwhelmed by their options on Amazon or go somewhere else if they’re confused. The Dash Buttons prevent both problems. Each button ensures brand loyalty to Amazon and to their household products; customers should never have to worry about what they should buy again. Customers are happier because they have to make one less choice each day and they can focus on bigger issues in their lives.
Kohl’s and Macy’s Use a Simplified Mobile UI to Narrow Results
Retailers like Kohl’s have modified their mobile retail experiences to create a “choice hierarchy” and prevent customers from getting overwhelmed. For example, a customer may select “Women’s Clothing > Shirts and Tops > Workout Tops” in succession to narrow their options from the hundreds of SKUs on mobile websites. By simplifying the user interface, customers can find exactly what they’re looking for instead of getting lost or distracted. These online experiences can also help brands in their stores. Almost 90 percent of customers use their smartphones for in-store shopping. A good mobile experience can lead to a sale if customers can look up the SKU on the retailer’s website and order a product in a size that a physical location doesn’t have.
Chipotle and the Art of the Guided Sell
While Chipotle offers customers options such as burrito bowls or tacos, the choices become limited to two to six options per station. Customers have only two bean choices and three salsa options. Instead of watching customers scan an endless menu, the staff at Chipotle is easily able to move guests through the lines as they order. With fewer choices, choosing different meal types gets easier.
Zemoga has been helping clients simplify and streamline their retail experiences for over 15 years. If you think your customers are getting caught in the Paradox of Choice, contact the experts at Zemoga today. Learn how you can improve your online experience and boost your brick-and-mortar business results.