Psychology of Ecommerce Sales: Too Much of a Good Thing

If you’ve ever heard the saying “too much of a good thing,” you probably assumed they weren’t talking about beer, chocolate, or cigars. Or, if that phrase was applied to ecommerce, you definitely didn’t consider they might have been talking about options for consumers. After all, one of the top pieces of advice many will give a fledgling ecommerce company is that more options (or more options to customize) means more buyers. Believe it or not, offering too many options can actually harm your sales, so apparently the old saying is true.

The Students at Columbia Said So

Though previous studies seemed to support the “choice is good” argument, Columbia University decided to question the veracity of that conclusion in what will be called the “jam study.” Customers were offered the choice of 6 different jams in one location and 24 flavors in another. Of those with 6 choices, 40% were more likely buy, as compared to 3% faced with 24 choices. The result is clear evidence that too many choices definitely discourage buying.

Someone forgot to tell Baskin Robbins, right?

Why Choice Paralyzes Buyers 

Paralyze might be a harsh word, but it’s obvious something stops buyers from parting with their money when presented with too many choices. We do like variety, so why would a lot of variety suddenly turn us off? A couple different possibilities exist, such as:

• A healthy amount of choices make buyers feel powerful. When faced with too many, narrowing down the possibilities becomes exhausting. At a particular point, buyers begin to feel either trapped or simply ambivalent.

• Too many choices may convey to the buyer that you’re not confident enough in the products you offer. Sometimes you need to make choices for the consumer to eliminate some of their responsibility in choosing. It’s up to you to cut the inferior products rather than forcing them upon your buyers “just in case.”

Our guess is that it’s a mixture of both.

When Is Enough Enough?

So, now you know too many choices can be a problem. How do you know when you’ve hit the threshold between “options” and “overwhelming”? One good sign would be a sharp decline in sales. If you’ve recently launched several new products, only to see your revenue tank, your first thought might be that buyers simply don’t like the changes. More likely, the addition of dozens of choices simply overwhelmed visitors, who then chose to leave rather than exert the energy necessary to decide.

Provide Choices Without Going Overboard

Striking a balance is obviously the solution, but how can you do this with your ecommerce site? When you have inventory begging to be sold, your instinct is to make everything available. Your first step should be to limit the inventory you keep on hand for your ecommerce site. When you offer customized products, this step is much easier. Items can’t be held in store if they haven’t been created yet.

Next, make discerning choices to offer only the products that really speak to your buyers and solve their pain points. Consumers trust you to take care of the initial decisions, so be ruthless and only offer the very best. Be the filter -- help customers make decisions they'll love. Balance the needs of personalization and customization with the dangerous possibilities of decision paralysis.

Finally, if you do introduce new products while older ones are still in stock, consider removing the older ones to create demand. Phase the products out by announcing their removal from your website, remind buyers to get them while they still can, and then simply retire the products. When you’re ready to remove the next product, you can re-introduce products still in stock “by popular demand” and watch them fly off the shelves once more.

Are you guilty of providing too many choices? Have you seen sales suffer when too many products are offered? We’d love to hear your take on the phenomenon, so leave us a comment!