Freedom of choice – on the surface it sounds like a good thing, and in marketing research studies, respondents unequivocally say they prefer to have choices. But with choice comes complexity.
Anyone who’s shopped for a car or a smart phone knows this all too well. This dizzying array of options consumers are offered nowadays by just about every other product and service today creates a decision dilemma – consumers find it difficult to choose and even fear making the wrong decisions. Paradoxically, freedom of choice and the complexity it brings can be paralyzing.
So, in a market full of choices, how can a brand optimize a product or service to give consumers the freedom to choose without creating decision dilemmas, while also benefiting the bottom line?
In the design of marketing research, specific questions about product mix and pricing depend on the understanding of someone’s concept of choice. Academics have been argueing that cultural factors are essential to understanding both basic marketing principles and specific research findings.
Consumers only consider choice to be valuable when they can meaningfully distinguish between the options being offered. Being permitted, or compelled, to choose among a vast selection of things that seem essentially similar might inhibit choice or even lead to the rejection of the opportunity to choose.
Whether increasing choice is the right move in a given market depends on what’s happening in that market. Are consumers pushing for more alternatives or more simplicity? Many companies are trying to strike a balance between the two by figuring out the best way to bundle certain options. The ultimate balance any company should aim to strike is the one between the ideal portfolio structure for consumers and its impact on sales and revenues. That takes asking the right questions for the specific market and arriving at actionable answers through sound research methodology.