man walking through the aisles of an overcrowded big box store
PHOTO: Hanson Lu

Imagine the following scenario: You just won a competition and as your prize, you get to pick a watch from a group of 15 or from a group of three.

Which one would you choose?

Most people choose the group of 15. Those same people are also more likely to experience higher levels of frustration, will put more effort in the decision process and eventually will change their mind and regret their choice. This behavior is the result of the interaction between the human evolutionary mechanism that was built to make simple choices and our world of abundance.

Western society teaches us to believe that the more choices we have, the happier we will be. We see this trend — and its results — all around us. Look at the world of online dating. Online dating is one of the most popular ways to find a partner, yet it too is fraught with decision paralysis. People suddenly find they have many suitors to pick from and their dating possibilities become endless.

This experience makes them feel truly attractive and desired and, without even noticing, they become addicted. But make no mistake, they are not addicted to love or dating — they are addicted to the idea of having many available possibilities.

People May Think They Want More Choice ...

 

The above scenarios exemplify a basic human trait: People love to have many options, even if they only exist in theory. When asked, who wouldn’t prefer to choose from a list of five different items over a list of only two?

People feel that the more options they have, the greater their chances are of finding the choice that will perfectly satisfy their needs. But this intuitive assumption turns out to be an illusion. Because the more options we have, the less likely we are to make a decision at all.

We live in a world of abundance, where we can find and purchase virtually anything we want (provided we have the money). But this wealth of choices can become an overwhelming experience, which can have a direct impact on a business's sales, and should be accounted for when presenting options to customers.

Observations of visitor behavior on multiple ecommerce websites has shown that, when customers are given a large number of options to choose from, they have a much harder time making a decision than those who use the sites' filtering tools to limit the number of possible choices. Visitors who try to scan through all of the different available products inevitably become frustrated and leave the website altogether.

This is because having too many options causes a sort of paralysis in the decision-making process, which leads to avoidance behavior — essentially choosing to do nothing at all. In the instances when a choice is made under these conditions, it is usually accompanied by frustration.

Professor Sheena Iyengar discussed this phenomenon in her book "The Art of Choosing." A grocery store presented customers with two different sampling stations: one with 24 flavors of jam and the other with only six options. The study revealed that the availability of six options resulted in 30% of consumers purchasing at least one jar of jam, while the sampling station with 24 flavors had a conversion rate of only 3%. While the larger selection attracted more onlookers, the smaller selection generated more sales.

Related Article: TED Takeaways: Help Your Customers Choose

Why Does Decision Paralysis Happen? 

When people are presented with many options, they fear making the wrong decision. This can be translated into simple math: with two options, we have a 50% chance of choosing the right one. But with five options, our chances suddenly decrease to 20%. Matters become even more complicated when we raise it to 20 options or more.

Human cognitive ability cannot efficiently compare more than five options, so most of us will start looking at the first few options and then stop.

Awareness that maybe a better option exists triggers the urge to find it. However, due to time constraints and human cognitive limitations, we are unable to engage in the elaborate thought process required to compare and contrast all of the available alternatives.

The "ever-changing reference point" also plays a role in the selection process. Whenever a new alternative is made available, the reference point is changed, thus creating a new perspective for the customer. 

Imagine you are looking to buy a used iPad on eBay. Before viewing the different items in this category, you limit your search results to devices priced between $150 and $200. After viewing the first four devices that meet your basic expectations, you suddenly see the same device, but with expanded memory. Suddenly, your standard level changes.

“Oh,” you think, “I can get an iPad with expanded memory for this budget, why should I settle for less?” Your comparison criteria have changed. From this point on, you will compare all other devices to the one with the expanded memory. Your reference point changed, effectively making your choice a one-way street. Once you take it, you cannot go back to your original reference point and settle for less.

Large selection harms the decision-making process. An excess of options can prevent our cognitive systems from efficient information processing. The system becomes overwhelmed and disrupts the decision-making process.

Related Article: Information Overload Comes in 3 Flavors: Here's How to Combat It

How Can Businesses Avoid Overloading Their Customers? 

Businesses must limit the number of options they present to customers. This doesn’t mean dramatically cutting the number of options available, but rather presenting them wisely, as an in-store sales representative would do when assisting a customer. There are several efficient methods for easing the selection process and giving the customer the direction they need.

One good way to avoid cognitive overload is to ensure that no row contains more than five items, and to format the page so each product is enlarged when the customer places his mouse over it. This will separate the items in each row from the rest of the items on the page, as well as making each product stand out as a separate unit. Our brains then register the decision-making process as a manageable task, and assign the required cognitive resources.

Another efficient method is filtering, which allows the customer to drill down to the most relevant options. This is similar to an in-store customer-service representative telling you, “Let me know what color and size you need, and I will bring it to you.” Companies can also structure the choice to make it easier for visitors to search for a good alternative. For example, they might arrange the information on a store page to align options by brand, purpose or mood (romantic, sexy or fun).

Providing a "default" or "suggested" option is another proven method of helping customers stay focused. It tells the customer, “This item fulfills all of your basic needs and it is sold for a reasonable price. Most of our customers choose this one.”

Social comparison can also be used as a facilitator, as in “Most visitors who share your profile choose this option” or “Customers who viewed this item also looked at these other options.” These sentences are socially oriented, helping the customer feel like part of a group and thus fulfilling our basic need of wanting to belong. This relates to another strategy often used by brick-and-mortar sales reps: using statements such as “Business women usually pick this bag” so potential customers will unconsciously associate a product with a group they would like to be a part of.

Most people welcome help when making a purchasing decision, as long as it isn't pushy. Digital media is the perfect platform to address these needs, because it allows businesses to provide their customers with appropriate guidance and direction while taking into account their cognitive limitations.