More Is More: Why the Paradox of Choice Might Be a Myth

It's widely assumed that overwhelming people with options -- whether in TVs or delicious jams -- can make them less likely to make a decision. But maybe that's wrong.
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It could be one of the most memorable economic studies of the last half century.

Researchers presented an array of tasty jams and enticed shoppers to buy a jar. In one version, there were six varieties shown to shoppers. In another, there were 24 jams. The second, larger array attracted more traffic. But the smaller array led to ten times more purchases.

Sometimes, they concluded, too many options repel us. The researchers called it "the paradox of choice." You might call it "feeling overwhelmed by options." But some economists are calling it something else: "complete hogwash."

A few years back, the FT's Tim Harford reported that if the paradox of choice were real, it wouldn't explain why Starbucks boasts 80,000+ drink combinations or why supermarkets offer dozens of varieties of cheese and nearly-identical yogurt and milk products. It's possible, of course, that Starbucks and grocery stores weren't smart about maximizing their profits. But perhaps these fabulously rich international corporations had learned a different lesson about choice: that less isn't always more. More is more.

The non-paradox of choice got some intellectual ballast when a team of psychologists and economists tried and failed to replicate the famous jam experiment:

After designing 10 different experiments in which participants were asked to make a choice, and finding very little evidence that variety caused any problems, Scheibehenne and his colleagues tried to assemble all the studies, published and unpublished, of the [paradox of choice].

The average of all these studies suggests that offering lots of extra choices seems to make no important difference either way. There seem to be circumstances where choice is counterproductive but, despite looking hard for them, we don't yet know much about what they are. Overall, says Scheibehenne: "If you did one of these studies tomorrow, the most probable result would be no effect."

But what about the other end of the choice spectrum? What about shoppers who don't have any choice at all? That's the subject of a new article by Daniel Mochon on "single-option aversion" in the new Journal of Consumer Behavior.

To understand single-option aversion, think about bread. A few years ago, Williams-Sonoma had a problem. They couldn't get anybody to buy their breadmaker, which retailed for $279. So they did something that might strike you as bizarre: They started selling a $429 model, as well. Of course, nobody bought the expensive version. But sales of the cheaper model doubled.

Why?

You could offer a few reasons. One is that the fundamental rule of prices is that consumers don't know what anything should cost (especially breadmakers) so we're persuaded by clues. The expensive breadmaker here acted as a clue -- a decoy that told other shoppers: Hey, you are getting an amazing deal on this breadmaker!

But another possible reason is that we're incredibly reluctant to certain items -- especially expensive items -- when only one option is presented. If you walked into a Best Buy store, and there was only one TV left, would you buy it? Even if it was pretty much what you were looking for? Mochon's research would suggest that many of you wouldn't. When he offered DVD players to participants in one study, just 9% said they would buy a Sony model when it was the only option. When paired with a Philips DVD player, the number went up to 32%. The mere presence of options quadrupled willingness to buy. Mochon replicated the finding with TVs and donations.

In a sentence, when shoppers are given a take-it-or-leave it option, it makes them more interested in searching for comparisons. The paradox of choice theory assumes that too many similar options -- e.g.: multiple varieties of Belgian dark chocolates, or many kinds of jam with strawberry as a main ingredient -- confuse what we're really looking for. But Mochon suggests that similar options heighten distinctions and make us more certain about our final choice.

"This research suggests that stores should be mindful of offering too few options," Mochon said. "Even if consumers can find an option that they like, they may be unwilling to purchase it without considering other similar options first." That's why Best Buy doesn't offer two TV or two cameras. It offers hundreds. It's why Starbucks and Whole Foods aren't irrational to give their shoppers a bounty of options. Sometimes, choices can paralyze us with anxiety and exhaust us. But sometimes, choices reduce anxiety by making us feel like we've searched exhaustively -- and now we're ready to buy.

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Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

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