Thursday, August 7, 2014

Do you prefer more choice or less? It depends on distance.

The appeal of big box retailers has always been a mystery to me.  On those rare occasions when I have to go to a place like Bed, Bath, and Beyond, I often find it frustrating.  Not long ago, I had to get a new coffee maker, and I fought through the crowd in the parking lot into the store.  From there, I stood before the wall of coffee makers, struggling to decide which of the huge number of options would be best.  There were so many choices, that I am not at all sure that I got the best one.

So, why are these stores so crowded?

There is an interesting tradeoff at work here.  On the one hand, people want to have lots of options.  That gives them the feeling that their choice is not at all constrained.  On the other hand, as the number of options goes up, the choice gets more difficult to make, and that can make it hard to know whether you have made a good decision.

An interesting paper in the December, 2012 issue of the Journal of Consumer Research by Joseph Goodman and Selin Malkoc examined how people resolve this tradeoff.  They find that preferences for the size of a set of options depends on the distance to the choice.

Lots of work, starting with studies by Yaacov Trope and Nira Liberman have explored influences of distance on thinking.  This work suggests that as an event gets nearer in space or time, people think about it more specifically. When that event gets further in space or time, people think about it more abstractly. 

In the case of choices, thinking more specifically has two effects.  On the one hand, when you think about a choice specifically, each of the options feels distinct.  The individual properties of a set of coffee makers, for example, becomes important.  So, thinking specifically can make you want a larger set of options.  When you think about the choice abstractly, all of the options seem more similar, and so the size of the set of options becomes less important. 

However, thinking specifically can also make it clear how hard it is to choose from among a large set of options.  This choice difficulty is less prominent when thinking abstractly.

The researchers found that distance can have both influences on the way people evaluate sets of options.

In most normal cases, people are not that focused on how hard it will be to make a choice.  In those situations, decreasing distance to a choice makes people think about the options as distinct.

In one study, college students were told about two restaurants that were opening.  They were going to be offered a gift certificate good for a free entrée on the day the restaurant opened.  They had to pick which restaurant they wanted to try.  Participants saw the menus for each restaurant.  One restaurant had many options (14), while the other had only a few (7). Some participants were told that the restaurant was opening that day (near in time), while other participants were told the restaurant was opening in five months (far in time). 

When participants were making the choice for a restaurant opening that day, they picked the restaurant with the larger selection 63% of the time.  When they were selecting a restaurant that was opening in five months, they picked the one with the larger assortment only 46% of the time.

In another study, participants were told to imagine that they were planning a dinner party for friends that was taking place the next day or several months later.  They discovered that their blender had broken and they needed a new one before the party.  In this case, they had a choice between two stores, one of which had a larger assortment (18 blenders) than the other (6 blenders).  People saw descriptions of the blenders, which were designed to be of about the same quality.  Participants were also asked to look over the set and to rate how similar they thought the set of blenders was. 

As in the previous study, participants were more likely to select the store with the larger assortment when they were going shopping that day than when they were going shopping in several months.  In addition, people perceived the entire set of blenders to be less similar when they were going shopping that day than when they were going shopping in several months.  This combination of results shows that people see the items as more unique when they are near in time to the event than when they are far from it.

Another study in this series examined the case where people were also focused on the difficulty of making a choice.  This study was similar to the one I just described except that some people were also told that evaluating each blender in the store would take between 3 and 5 minutes.  That information made it clear that evaluating a larger assortment would take much more time than evaluating a smaller one. 

In this study, participants who were not focused on the difficulty of making a choice showed the same pattern as the previous studies.  They preferred the store with the larger assortment when they were making the choice that day than when they were making it in several months.  When people were focused on the difficulty of making a choice, though, the pattern flipped.  Now, they were more interested in the store with the smaller assortment when they were making the choice immediately and the store with the larger assortment when making the choice in several months.

Ultimately, both factors should play some role when making a choice.  In cases where it is critical that you find an option that perfectly fits your needs, it is good to have a large assortment (as long as you have the time and ability to evaluate all of the items).  Most of the time, though, you probably need something that is just good enough.  In those cases, it might be better to find a store with a smaller number of high-quality options. 

Finally, remember that you will think differently about the value of having many options depending on how far away the choice is from you. Take that into account when deciding where to shop.