Tim Harford in the Financial Times:
Is more choice better? Ten years ago the answer seemed obvious: Yes. Now the conventional wisdom is the opposite: lots of choice makes people less likely to choose anything, and less happy when they do choose.
The most famous supporting evidence is an experiment conducted by two psychologists, Mark Lepper and Sheena Iyengar. They set up a jam-tasting stall in a posh supermarket in California. Sometimes they offered six varieties of jam, at other times 24; jam tasters were then offered a voucher to buy jam at a discount.
The bigger display attracted more customers but very few of them actually bought jam. The display that offered less choice made many more sales – in fact, only 3 per cent of jam tasters at the 24-flavour stand used their discount voucher, versus 30 per cent at the six-flavour stand. This is an astonishingly strong effect – and utterly counter to mainstream economic theory.
One practical response to such experiments is that choice can be a good thing overall even if it does discourage us. I may find the choice between Robertson’s jam and Wilkin and Sons’ jam irritating and of no practical consequence to me, but you can bet that it has consequences for the two companies. We are often offered an apparently pointless choice between two equally good products, not appreciating that they are only good because we have been offered the choice.
The counter-argument was once put in a sketch about TV deregulation by Stephen Fry and Hugh Laurie: a waiter whisks away silver cutlery from a politician responsible for the proliferation of channels before dumping a sackful of plastic coffee stirrers in his lap. “They may be complete crap, but you’ve got choice, haven’t you?” Funny, but Fry and Laurie had it backwards. Zero choice is the fastest route to low quality.
But a more fundamental objection to the “choice is bad” thesis is that the psychological effect may not actually exist at all. It is hard to find much evidence that retailers are ferociously simplifying their offerings in an effort to boost sales. Starbucks boasts about its “87,000 drink combinations”; supermarkets are packed with options. This suggests that “choice demotivates” is not a universal human truth, but an effect that emerges under special circumstances.
In my view, the so-called paradox of choice is one of the most overrated and incorrectly cited results in the social sciences.
Perhaps the paradox of choice used to be true in simpler times, but the internet and the rest of modern life have taught us to revel in choice, rather than being intimidated by it. In a related vein, maybe it’s a generational thing. Maybe choice dazzles me more than it does a 20-something who grew up with 87 cell phone plans, 300 cable channels, and 1,000 Facebook friends.
Personally, I find a wide array of choice intimidating mainly if I’m trying to buy something brand new that I don’t know anything about. If there are 20 different kinds of cough syrup on the shelf, and I’ve never bought cough syrup before, I might just give up on the whole thing and keep on coughing. I suppose that’s pretty obvious, but it might explain the differences in some of the experiments. If you showed me a huge variety of wines, I might throw up my hands in despair rather than trying to puzzle out which one to buy. Show me an equally huge variety of candy bars and I’d pretty quickly narrow it down to half a dozen that I liked and then choose one. That’s because I consume a lot more candy bars than I do wine.
It’s worth noting that whether or not social scientists are certain that the paradox of choice really exists, good sales people are certain that it does. Watch a good sales person at work, and you’ll notice that one of the first things they do is try to narrow your choices for you if you seem even the least bit confused. When they ask what features are most important to you, they’re trying to narrow your choices. When they ask what things you don’t like, they’re trying to narrow your choices. When they ask about your price range, they’re trying to narrow your choices. Because they know in their hearts that if they can just get you down to two or three alternatives, there’s a pretty good chance you’ll get seriously invested in the decision process and then eventually choose one of them.
Even aside from technology, we’re used to more choices. Yes, we’ve gone from 3 TV channels to hundreds but also from 3 or 4 car manufacturers to a dozen, an almost infinite variety of coffees, ethnic restaurants, and many other things over the course of the past few years.
Kevin’s also right, I think, that our familiarity with the product in question matters. It’s a bit of a chore to chose between seventeen brands of strawberry jam, for instance, but not all that complicated. On the other hand, choosing a cell phone and accompanying plan — and being obligated for two years to live with that choice or pay heavy penalties — can be rather intimidating.
It also occurs to me that the original experiment may just demonstrate that people aren’t interested enough in jam to spend a lot of time comparison shopping. So, unless they’ve run out and really need some more, they may bypass a giant display whereas choosing between, say, strawberry, grape, and cherry and then between Smuckers, Polander, and store brand makes impulse purchases more inviting.