School of Psychology, Deakin University
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Are you someone who struggles to make up your mind? If you’re stopped in your tracks in a state of indecision, it can be hard to move forward to the next step.
Armed with knowledge from psychological research, savvy companies know how to tap into our tendency for indecisiveness. From product packaging and advertising to website design and recommendations, our choices are being manipulated every time we shop.
‘There’s a whole new field of ‘choice architecture’ that is all about strategic design to affect how you make decisions,’ says Dr Melissa Weinberg, Honorary Fellow at Deakin University’s School of Psychology and a member of the Australian Centre on Quality of Life.
Although we often think we like to have the freedom to choose from a wide variety of options, the ‘paradox of choice’ – a theory made famous by psychologist Barry Schwartz in a 2005 TED talk – suggests it can make life more difficult.
‘We’re actually less likely to purchase an item when we’re shown too many options. If we do make a choice, we end up feeling less satisfied with that choice than if we had made our selection from a more limited range of products,’ Dr Weinberg explains. At its worst, faced with too many options we can reach ‘choice paralysis’ where we end up making no decision at all.
The choice paradox was famously illustrated by Sheena Iyengar and Mark Lepper in 2000, in what’s called ‘the jam study’. One group of supermarket shoppers saw a tasting booth with six varieties of jam, while another group saw a booth with 24 varieties. ‘Even though more people stopped to try some jam when the booth showed more options, more people ended up purchasing a jam when they only had six to choose from,’ Dr Weinberg says.
While companies can manipulate the number of products on their shelves and how they’re displayed, they can also use similar tactics online, Dr Weinberg explains.
‘One design feature that we see a lot of now on retail websites (think Eastbay for example), is to offer you the option to see ‘all’ products, or to filter your choice down to a more workable size. This is a clever tactic because it feeds into your ‘illusion’ of choice.’
Smart website designers understand customers like the idea of having a wide range of choices. But ultimately, you’ll be more likely to make a decision – and feel satisfied in doing so – if your choice is restricted.
'We’re actually less likely to purchase an item when we’re shown too many options. If we do make a choice, we end up feeling less satisfied with that choice than if we had made our selection from a more limited range of products.'
Dr Melissa Weinberg,
Sometimes when daunted at the prospect of weighing up options, we just go with the ‘default’ choice. Companies that label products as ‘recommended’, ‘most popular’ or ‘related’ are appealing to our ‘default bias’, explains Dr Weinberg.
‘It could also be used to appeal to our tendency to conform if, for example, we’re told that “others like you have purchased this product”.’ It can be easier to make a decision knowing someone else has already thought it through – and we can always blame them if we end up unhappy.
‘Loss aversion describes the idea that we’re more motivated to avoid losing something than we are to gain something,’ Dr Weinberg explains. ‘If we lose something that belongs to us, it takes gaining back twice as much of that to come out “emotionally even”.’
This was demonstrated by Amos Tversky and Daniel Kahneman in a 1991 paper, who found the affective cost of losing $10 could only be neutralised by winning $20. In another example, if you and a friend wanted to commit to doing 20 minutes of exercise a day, you could make an agreement that if you comply, you’ll treat yourselves to dinner at the end of the week. However, loss aversions tells us you’d be better off agreeing that if you don’t do exercise every day, you’ll pay your friend $10.
Companies that offer a ‘money back guarantee’ are playing into our tendency for loss aversion. ‘With this deal, you don’t need to worry about ‘losing’ your hard-earned money, because you can get it back if you’re not satisfied with the product,’ Dr Weinberg explains. ‘Companies know that, typically, once you own the product you’re unlikely to return it, and so it’s essentially a risk-free offer for them.’
It may be interesting to arm yourself with the understanding of these psychological concepts, but it can be another thing altogether to override them when faced with a tricky choice.
School of Psychology, Deakin University
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