Choice Overload

This is from a talk giving by a guest speaker, back in Google. It was  on ‘How to make Choosing easier’. 

It’s a little surprising that even making a choice needs to be made easier, but apparently there is something called a choice overload. 

Today we know that walking into a super market means exercising a choice many times over, be it in oils, shampoos,or jams, in fact most products. They apparently did an experiment in a store that sold 336 kinds of jams. They had a counter outside the store, one with 6 different flavors of jams and one with 24 flavours of jams, each over one week. And the survey showed that more people stopped at the counter with 24 flavours of jam than they did at the counter with 6 flavours. However, on actual sales, the counter with 24 flavours sold 3% and the one with 6 flavors actually sold 30%. So effectively the one with 6 flavors sold more.

People were likely to actually buy more, when given a lesser choice.

              Jams/Marmalades

    in a Supermarket in Germany

Apparently this holds true even in more consequential decisions. When there’s too much choice, we choose not to choose.

This was a study done on retirement plans in the US. The survey was done on a million employees, covering 600 plans all over US, and they found that the more funds offered in the plan, the lesser the participation. Plans that offered 2 funds had a saving rate of 70% while plans that offered 60 funds had savings rate drop to 60%. 

What they also found is that even when there is a choice made, too much choice results in three consequences:

1. Procrastination: people tend to delay making the choice
2. Decision quality: likely to make the wrong choices
3. Satisfaction: likely to feel less satisfied, even if its an objective right choice

Key is to be choosy in making a choice :)

And a more interesting factor was how 'making a choice' was a factor of culture, with the Americans believing in the right and freedom to choice in almost every decision, but not so the Asians, who seemed to be comfortable with choices being made for them.