Marketing Choice Overload - Essay Example

Marketing – Choice Overload Choice Overload Introduction: The aim of this paper is to make useof various sources in order to understand the application of the concept of choice overload in the buying behaviour and marketing of products by the organizations. Herein, there are merely two aspects that one can see when it comes to the discussion of choice overload. Firstly, researchers are of the opinion that more choices have made people confused when it comes to buying. Secondly, organizations that do not provide consumers with excessive number of options are preferred more in comparison with the other. In addition, it can be noted that there are a large number of studies that have been conducted in order to understand the concept of choice overload. The most widely referenced source in this regard is Schwartz’s. It is due to this reason that the following paper will be greatly based on the source or the book written by Schwartz entitled, “The Paradox of Choice”. Understanding the Concept of Choice Overload: It is imperative to understand the basic definition of the concept choice overload before looking at various perspectives on the subject of matter. It is an evident fact that choice overload is associated with the ability of the consumers to buy more products. The consumers observe the choices when they are given more than one product of a same kind. It does not only make consumers think about the limitless options they have but also think of better ways to consume the product. At times, it is also noted that the concept of choice overload is a behavioural aspect to be learned within the field of psychology. Definitions of Choice Overload The term Choice Overload is also known as Overchoice. Choice overload is defined in many aspects; it has directly linked to the consumer behaviour and decision-making. Choice overload is now considered as a major problem facing by consumers at the time of purchase. It is also defined that manufacturers, retailers, and other businesses have not increased the choice overload in term of giving options in products, but they have also overloaded the related information. Giving multiple alternatives and bundle of choices does not satisfy the need of a consumer, it rather drive them in psychological depression and thrive their stress level. Consumer start losing their confidence and level of confusion arise which eventually resulted in disturbing their personality (Lee & Lee, 2004). Literature Review: As per the study conducted by Cherev, Bockenholt, and Goodman (2012), it has been noted that despite a lot of stress on providing options to the consumers, it is still not sure that assortments can be beneficial for the consumers. In order to find out the extent to which the choices can make differences in the buying behaviour of consumers, Cherev, Bockenholt, and Goodman undertook a research methodology where a meta-analysis was undertaken. The number of observations noted during the data collection was 99. The chosen variables of the research included the complexity of selecting choices, uncertainty in terms of preference, difficulty when it comes to making choices, and goal to undertake a decision. The findings indicated that consumers either regret their choice once they buy the product or become less satisfied with the purchase (Cherneva, et al., 2012). In another research, conducted by Benjamin Scheibehenne, two respective sides of the picture were observed. The author provided the readers with the insight about choice overload from an advantageous point of view as well as the negative sides. The study discusses that historically, the variety revolution was observed because European wanted to feel free. It was due to this reason that the products were manufactured by keeping different demands into consideration. Europeans believed that by getting increased freedom, they could make a better decision instead of becoming a slave to one product. It also allowed them to use products that suited their personalities, as well as lifestyles. Right from its inception, it became effective for the markets to grow because increased sales were observed as well as various businesses began to explore new markets. However, the drawback became evident for people to note when increased raw material became under use (Scheibehenne, 2008). Another side of the research is based on the negative side of having too many choices. Too many choices lead to negative consequences. The effects can be seen on an economic level. The larger number of choices for the customer resulted adversely for the company as well. Fewer options for a customer have its economic benefits. To understand the broader perspective of limiting the production by producers, the author explained that producers find difficulty in balancing the variety and number of units produced. The imbalance by the producers brings a short of supplies. Producers fail to manage the cost of one unit taking all the verities in mind. In addition, factors include in negative consequences are less satisfaction, regret over choosing one variety out of all, disappointment and decrease in motivation while choosing a product or decrease in the rate of consumption. Many theoretical and empirical models were adopted in the research to identify the causes of negative response to choice overload, one of the study concluded that the more choices to the customers becomes unattractive for them. They limit their preferences over 15 to 20 choices and skip the whole range, a large range of choices becomes unappealing for them. The decision of producing a larger number of products often leads to bad decision making by the company (Scheibehenne, 2008). Jiajing and Meng (2014) illustrated the importance and effects of Choice overload in the markets. They argued that the product and service diversification is the outcome of providing different choices to the consumers. They also highlighted the negative impact that the choices impose on the minds of the consumers; these choices can influence the decision-making process. This effect is known as the choice overload effect according to the authors. The researchers used the tourism products and they also used two scenarios to conclude their research. The scenarios were then analysed by the researchers through examining the selection criteria and satisfaction of the consumers with respect to the scenarios. The final analysis was done to check the effect of choice overload on consumer buying behaviours. The results of analysing the selection criteria and satisfactions stated that there is a relationship between the choices of the option presented to the consumer, and also the increase in satisfaction can be noted. It means that more options provided leads to better choices and satisfaction of consumers. The analysis also highlighted a negative effect of choice overloads. The researchers concluded that too many choices provided by the same company would result in the lesser selection of the products and lesser satisfaction to the consumers. The satisfaction levels of the consumers vary for both the scenarios. The research concluded that the behaviours of the consumers might influence their decisions. The more are the needs and wants of the consumers the lesser are the satisfactions, on the other hand, the lesser the needs and wants higher are the satisfaction levels (Jiajing & Meng, 2014). Reed, et al. (2011) researched about the set of mind of the consumers with respect to the choices available to them. Previously the phenomenon followed in the world market was that more options are encouraged by the consumer, but the importance of choice overload was also introduced in the market that stated that too many choices have adverse effects on the consumption of goods and services. These choices lead to a decrease in the cognitive resources and the consumers also examine the level of regret of their choices before their purchase. It leads to decreased number of consumption of products and services that are provided by too many options. The researcher focused on the medical treatments and analysed the effect of choice overload on the consumption of medical products and services. The preference of the consumers/ participants chosen for the experiment was consistent with their choices when limited products were available, but respondents’ preferences shifted drastically by adding more options/ choices in the products selection. The results illustrated the choice overload is influential in decreasing consumption of the products and services. The researcher also pinpointed the effects of the choice overloading on the behaviours and attitudes of the respondents. The research study was qualitative in nature and described the relationship between perceptions and behaviours of people on their buying/ purchasing trends. The choice overload was considered to be one of the core reasons for the change in the behaviour of consumers (Reed, et al., 2011). In one more study, conducted by Yejing Ren, describes an experimental approach comprising on Status Quo Bias and Choice Overload, he has discussed the tendency of customer maintaining their previous set of choice over an extensive and expanded set of choice they see on buying for the next time. The researcher has found out that the larger set of choice makes customer choice weak, and they prefer to stick to the previous choice. The term of status quo in the study defines the decision of sticking to the previous choice, or another definition is ‘loyalty’. Yejing Ren used the experimental approach and used a methodology of experimenting a relation between status quo and choices overload. He used play cards consisting different choices on the sample of 100 people. He used four types of treatment, in first, people were given set of choices with no restriction of time, second was about giving set of choices with limited time, treatment three was about undermining the set of choices with a time constraint and lastly, fourth treatment was based on undermining the set of choice while keeping time limited in making choices. The process was undertaken to find out the effects of choice overload on the bias of status quo whether the restriction over time while making choices and the process by which customer handles cognitive limitation caused by choice overload. The finding of this research indicates that with the increase in choice, people start losing their interest, and the quality of choice declines and they end up on trusting their previous choice. It is also noted that especially in the limited time customers choose the better option rather than going for the best one (Ren, 2014). In the book, entitled “The paradox of choice” by Barry Schwartz is a well researched with well-explained reasons. He has well argued about the anxiety faced by consumers at the time of buying and making a choice from a bundle of choices. He has explained the effects of having many choices in almost every case like, whether a consumer is buying pair of jeans, ordering a cup of coffee, choosing a long term career, making choice for university or college, setting up plans for retirement, or making choice to go for doctor, cutting the cases short, he has talked about every day decisions a consumer face no matter they are small or big. The larger the choice consumer will have, the chances of increase in anxiety will be greater. The complex overtaking decision for minor or major things increase with an extensive choice that are presented and provided by the companies to consumers (Schwartz, 2009). To discuss further, according to the author, it is a common assumption that a variety of choices is equivalent to better choices and leads to a greater level of satisfaction. He argued that this common assumption is not true because too many choices can make a consumer into a state where he start questioning his decision before even taking it. The state of confusion leads a customer to expect high which might be unrealistic. And it can also result in blaming oneself in case of any failures. The bundles of obstacles faced by the consumer can cause many problems like decision-making paralysis, an increase in anxiety, and it continues the level of stress. He has also included a medical study that claims a larger number of stress among the population in the United States.it is said that, in recent times of choice overload, the ratio of clinical depression is greater than the previous century. The reason for clinical depression is that we are living in a culture where an excessive choice is given, and people can’t handle it psychologically and they fall in a state of anxiety and fails to deal with vast options (Schwartz, 2009). The book describes the behaviour of a consumer from a psychologist’s point of view. Schwartz covered the issue of choice overload from the point of time when we make choices; he compared numerous choices of an American face in daily life. He accounted his study of choices starting from an assortment of choices at a superstore and compared it with the variety choices of classes at a known college. He described the time of choice or the moment when we choose. He undertook a point where a person creates a difference between his wants and what exactly he wants is not a solution that helps to handle the situation of choice overload. A person commonly fails to take control over focusing his ‘want’ among too many choices in the first place. In the second section of the book, he explained the idea of making a good decision that a consumer follows while choosing his want. The strategies that the consumer applies to make a good decision involve six steps. Firstly, the procedure of setting goals begin with the question of what does a consumer want, when a consumer is provided with many choices, he begin his thinking to make choice among the possible variety with the expectation of experience. The expectations of experience are an expected utility. After having an experience once of the particular choice, the next time of making a choice would be called remembered utility. To confirm the question of what does a consumer want would be based upon the utilities defined by the writer. The difference between expected experience and experience of choosing a particular choice would make them able to make a choice for the next time. After figuring out the goals, second step the writer followed is evaluating each goal’s importance. He has included the study of two researchers who have given their idea in the process of decisions that the consumers make. They found many rules of thumb that took them off the record. Their study indicates that people give large weightage to the evidence, which are subjective or untrustworthy. And this is a chance where expert evidence becomes weak. The researcher gave a name to this situation, ‘availability heuristic’. When a person has some piece of information in his memory, there are more chances that a person has encountered in the past. Most noticeable or important piece of information in the memory influences the weightage. Third step in the consumer’s strategy include the display of options, in which the writer gave a concept that a personal accounts of psychology will generate the effect of framing choice and considering all the factors that are linked to the option. Measure all the options along with the accounted factors and realize the important of the choice, which is supposed to be made. The fourth step is to evaluate the options, which are closer to the goal. In this step he gave the example of a creative accountant, a consumer also creates his psychological balance sheet look good or bad as he actually wants his sheet to look. The fifth step is associated with picking up the winning option. The writer gave an argument about the options that are already attached to the choice that is under consideration. Choices without the options are not the part of the endowment and choosing those options are observed as again. And lastly, the sixth step is about modifying goals. Schwartz pointed out that people use the consequences of choices to modify their goals, the importance and evaluation of future possibilities associated with the goal (Schwartz, 2009). Schwartz also included the study of a psychologist, Herbert A. Simon that discusses the psychological stress that a consumer face today from 1950s. He noted some important points of Simon’s study that gives a concept of maximizers and satisficers (Schwartz, et al., 2002). He explained that a maximizer was like a person with perfection, a person with an attitude that assures about the product he bought is the perfect, and his purchase decisions are best. A maximizer imagines all the possible alternatives to purchasing or making a decision. Psychologists consider this task as daunting, in case of an increase in number of choices, it becomes more daunting. In contrast, maximizing the alternative is to be a satisficer. A satisficer set criteria and standards; he has no concerns to think about the better possibility. Schwartz agrees with Simon that the strategy of maximizing is satisficing. In the third section, Schwartz discussed the reasons for suffering. He combined many psychological models for happiness that shows the problem of choice can be discussed in diverse strategies. He explained the choice and happiness, abundance in choices to the customer have more chances to put a customer in depression, and they feel lonely. Further, he described freedom or commitment model that relates to the issue of unhappiness handling by the population. They can quit the situation, or they can disapprove and record their concerns. Governments of the free market give an option to the people by switching to other brand or in other case, raise your voice against the problem. Another model he included is Second-Order decisions. It is related with making rules to make choices, eliminate the troublesome of having a variety of choices. He gave several methods under the second decision model that can overcome the problem and confront them. In the end, Schwartz gave a concept of Missed Opportunities. In which a person chooses one option from many desirable options. They start considering trade-offs hypothetically. They emphasize on thinking about the opportunities that they missed rather thinking about the potential of the opportunity. This strategy affects the level of satisfaction and produces negative emotions in the customer (Schwartz, 2009). Conclusion: From the above discussion, it can be concluded that in today’s society every individual is facing a situation of choice overload. The fact cannot be denied that the society has been developed that face abundance of choice on a daily basis. The rate of increase in anxiety and clinical depression is growing with the passage of time. In case of shortening, the choices for consumers may show adverse effect for the brand since it has become a part of every individual’s life to select from too much of choice. Many of the researcher and economists suggested overcoming this problem, but the culture of having plenty of choices might affect consumer psychologically. Once the problem is identified, many solutions can be drawn to minimize the problem. Schwartz described the choice overload in many areas of life. Many analysts and economist look from their perspective and suggest some strategies to strategies makers. They recommended the ideas of making the choice easier for the consumers by reducing the choices or reducing the number of options, which are available. Less available choices will benefit the business side as well by an increase in sales. Another option can be selected by marketers to market the best and popular option among all instead of marketing the whole range of products. Businesses can also offer a forum on Internet where customers can tell their preferences, it will be helpful for the customers while making a purchase decision. Fewer choices with best quality can maximize the number of customers with high level of satisfaction and low level of regret for the customers. List of References Cherneva, A., Bockenholt, U. & Goodman, J., 2012. Choice overload: A conceptual review and meta-analysis. Journal of Consumer Psychology, 25(2), p. 333–358. Jiajing, H. & Meng, Z., 2014. Are More Options Better? A Study of Choice Overload in Tourism. (English). Tourism Tribune / Lvyou Xuekan, 29(12), pp. 14-21. Lee, B. K. & Lee, W. N., 2004. The effect of information overload on consumer choice quality in an on-line environment. Psychology & Marketing, 21(3), pp. 159-183. Reed, D. D., DiGennaro, F. D. R., Chok, J. & Brozyna, G. A., 2011. The "tyranny of choice": choice overload as a possible instance of effort discounting. Psychological Record, 61(4), pp. 547-560. Ren, Y., 2014. Status Quo Bias and Choice Overload: An Experimental Approach, Bloomington: Department of Economics, Indiana University. Scheibehenne, B., 2008. The Effect of Having Too Much Choice. First ed. Berlin: Universität zu Berlin. Schwartz, B., 2009. The Paradox of Choice, New York: HarperColllins. Schwartz, B. et al., 2002. Maximizing versus satisficing: happiness is a matter of choice. Journal of personality and social psychology, 83(5), pp. 1178-1179. Read More