Drowning in a sea of choices

I found this idea of “paradox of choice” not only interesting, but eye-opening. Barry Schwartz explains that in order to maximize welfare, individual freedom must be maximized as well. In the marketplace, this idea of increased freedom translates into an increased number of choices. Rather than freedom increasing, what actually happens is that we grow preoccupied by the many choices that we are faced with in our everyday lives, resulting in an effect that actually negates individual freedom.

Before watching this podcast I would have said that it is a good thing to have a lot of choices. Relating back to our discussion of generation Y, if we all want to be unique and we all want to be individuals, an ample amount of choice aids us in the pursuit of this goal. This podcast, however, reveals that choices are a good thing, but only up to a point. I started to think of more ways in which high levels of choice hinder me as a consumer, in addition to what Barry Schwartz describes as a preoccupation with whether or not the right decision was made. I spend so much time in the grocery store sifting through my choices, and subsequently wonder how my time could have been better spent elsewhere. Therefore, not only am I thinking about whether or not I made the right decisions when I leave the store, but I am conflicted by the amount of time I spent making what potentially could be a bad decision.

My experience leads me to see an important implication for marketers from a new perspective; customer loyalty. As a consumer, I question my decisions much less when I know that I can trust a certain product to never let me down. Not only that, but the time it takes me to shop decreases when I can specifically pinpoint what I want. I can be looking at a wall of product choices, but because of repeated positive experiences with a product, I only see one. In a competitive marketplace the number of choices will remain the same, so companies must take strides toward making our decisions easier.

The example of employees being presented with choices of funds to be matched by their employers is very interesting. Prior to listening to this podcast, I would have found it hard to believe that a decision that has a potentially high payoff could be suspended for fear of the wrong choice. I was reminded of a course I took in consumer behavior that focused predominantly on the difference in consumer’s thought processes depending on whether they are making a low-involvement or high-involvement decision. Decisions that are low-involvement are made with a great deal of reliance on the subconscious, using nodes or associations formed within the brain to decide quickly. However, those decisions that are high-involvement take a great deal more thought and research to convince a consumer that they are making the correct purchasing decision. In most cases, high-involvement decisions involve those items or choices that require a large investment or are categorized as high-risk. If this concept presented the whole picture, the employee would simply do his or her research and make the decision they felt was best. The podcast added a new dimension to my understanding of this concept, in that it is not always that simple. In the end there is always some amount of regret and wonder as to whether or not one of the other choices would have yielded a more positive result.

Whenever I shop on the new Amazon.com I feel like I am a victim of the paradox of choice. Vendors from around the world list their products on Amazon, making the selection in a given product category seem almost endless. My most recent encounter with this was over Winter break when I received a gift card to the website from my grandparents. Forces behind the paradox of choice were strong before I even logged onto the website because I knew what I was going to be faced with. I wanted to order a pair of earrings because I had recently lost one in a set similar to them, which seemed like an obvious choice. I found the perfect item to buy, but when faced with so many other competing choices, the decision suddenly grew far more complex.

I ended up buying the earrings, but I am still in a stage where I think about that decision. When I stumble upon a book or a movie (or anything for that matter) that I really want but didn’t think about at the time I purchased the earrings, it brings me back to that decision.