Tired of choice: why keeping a roduct portfolio simple matters to help consumers leave a store with a purchase.

It’s been widely known that excessive choice could make a consumer walk away without a purchase. I never expected I’d find myself in a similar situation in a category I thought I knew well.

I needed a new razor so during my weekly round of grocery shopping I stopped by Gillette display in a local supermarket. This is what I saw:

These days if you’d like a Gillette’s best performing razor, which is 5 blades Fusion family, the choice is between: ProShield, ProShield Chill, ProShield Power, ProGlide, ProGlide Power, Gillette Fusion (without any further extensions) and ProGlide Styler. When you read “Gillette Fusion ProShield Chill” once, it already feels mildly unclear. When you have to read seven of them and to figure out the difference, you’re seriously confused.

“Ok, the difference between ProShield and ProGlide is lubrication, got it. How important is it? What’s the price difference? What does “Chill” do? Are all the blades now interchangeable? Why Styler is branded ProGlide, while the most advanced seems to be the ProShield?  Are there just three handle designs and sub-brands change, depending on blades’ (cartridges) features?” With all these and other questions running through my mind, I realized I’m seriously running out of time as I’m only half-way through my shopping list. A relaxing thought that I didn’t have to buy a razor this time almost made me deflect and walk away. I used to work in Gillette, so acknowledging a defeat was not an option. Minutes later I was proudly pushing my cart with a Gillette razor in it. I wonder how many men in my situation just left, hoping sooner or later to receive one of those razors as a gift from a friendly female.

Too much jam

There has been a lot of studies about choice overload. Psychologist Barry Schwartz coined the phrase “Paradox of Choice” to describe his consistent findings that, while increased choice allows us to achieve objectively better results, it also leads to greater anxiety, indecision, paralysis and dissatisfaction.

One of the first studies in the field is famous jam experiment (full results here) conducted by psychologists Sheena Iyengar and Mark Lepper. Basically, it was found out that consumers were 10 times (!) more likely to make a purchase, when the number of variants on display was reduced from 24 to 6 (3% vs 30% purchase rate). Less choice, more sales.

Steve Jobs is right. Again!

Since then, other studies have supported these findings, with subjects ranging from chocolates to 401(k) plans. Along with product range, such simplification seems to work for pricing as well. Marco Bertini and Luc Wathieu in their HBR article describe their online music store experiment, in which half the participants were told that the store would charge $1.29 for current hits, $1.19 for soundtracks, $1.09 for classical music, 99 cents for country, Latin, and jazz and 89 cents for everything else. The other half was told that every download would cost $1.29. Those offered a uniform price of $1.29 were 31% more likely to buy and on average anticipated buying 1.08 songs more per month. This would mean spending $49.10 a year on music rather than $25.95 – an increase in revenue of about 89%!

In case with iTunes Steve Jobs explained that to charge a uniform price was not only fair, but also got customers to think about the benefit of iTunes’ huge selection, rather than to focus on saving money. Again, simplification in action!