Tall, Grande, or Venti
America is a land of choices. Even buying a sandwich involves more than 7 choices (bread-type, bread-length, patty-type, vegetables, pickles, seasoning, packing)! America is also a land of research (academic research, market research, political polls). It was only a matter of time before someone did research on choices (New York Time article - one-time (free) registration required).
Barry Schwartz presents a provocative proposition - that adding choices actually reduces consumer value, either by “reducing satisfaction”, by confounding the consumer into a non-optimal choice, or simply by paralyzing her into inaction.
Interesting thoughts, but I would be careful drawing meaningful or actionable conclusions from it. First, in my opinion, the utility function for choice (i.e. a graph of choice vs. utility of choice) is a reverse-bathtub curve, not a negative exponential one. In other words, while too much choice may be non-ideal, complete lack of choice is not the alternative. I can see misguided policymakers using this research to justify limiting consumer alternatives. At the extreme, it being used to argue that monopoly is better than a free market. Second, as his examples show, people’s response to increased choice is not consistent – it ranges from “reduction in satisfaction” to complete analysis paralysis. So, it is difficult to create an action plan based upon predictions of behavior. A warning to retail merchandisers, consumer product managers, and social scientists.
Barry Schwartz presents a provocative proposition - that adding choices actually reduces consumer value, either by “reducing satisfaction”, by confounding the consumer into a non-optimal choice, or simply by paralyzing her into inaction.
Interesting thoughts, but I would be careful drawing meaningful or actionable conclusions from it. First, in my opinion, the utility function for choice (i.e. a graph of choice vs. utility of choice) is a reverse-bathtub curve, not a negative exponential one. In other words, while too much choice may be non-ideal, complete lack of choice is not the alternative. I can see misguided policymakers using this research to justify limiting consumer alternatives. At the extreme, it being used to argue that monopoly is better than a free market. Second, as his examples show, people’s response to increased choice is not consistent – it ranges from “reduction in satisfaction” to complete analysis paralysis. So, it is difficult to create an action plan based upon predictions of behavior. A warning to retail merchandisers, consumer product managers, and social scientists.
