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The Paradox of Choice states that when people are given to much choices they may freeze and end up making no choice at all. In a study done in a grocery store people were confronted with display of jams that they could sample. For half of the participants – unknowing regular costumers – the display had only 6 jam flavours, while the other half was presented with 24 different varieties.

The greater variety of jams made more people stop over the display (60% on the 24 jams display vs 40% on the 6 jams display). However, while 30% of those that stop at the 6 jams display bought something, only 3% of those that stopped at the 24 jams display did so. The proposed explanation for this is quite simple: the costumers that were confronted with the 24 jams display had too much choices available and the cost of making a wrong decision was higher. We may want more choice, but we actually do better with less.

An article on The Globe and Mail website reports that retailers are taking notice of this kind of incongruity and have started to cut some products, reducing the choices available but raising profits:

In a reversal, retailers are now reducing the amount of choice on their shelves. After years of tempting customers with ever expanding arrays of brands, hues, sizes and flavours, they’re racing to simplify their offerings. The recession has encouraged them to focus on top sellers and private labels while throwing marginal products overboard.

Storekeepers are culling their product lines to trim costs, reduce consumer confusion and ultimately boost sales. Reducing the number of products can help companies increase sales by as much as 40 per cent while cutting costs by between 10 and 35 per cent, according to a 2007 study by consultant Bain & Co.

You can read the rest of the article here.

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