As customers and citizens, we’re surrounded by choice. Think about the number of choices we make every day – what health treatment to undergo, where to travel, how to customise our latest electronic device.
What if freedom of choice comes with too much information? We’re living in the digital era where information is cheap, so access is on the up. But how much information do we need? Do we really want to know whether our movements measured by a mobile phone will predict the likelihood that we’ll develop Parkinson’s disease? Do we need to ask someone on a date just because an app tells us that we’re well matched and sat at the same bar? If we’re hungry, do we need to see all the restaurants within a five mile radius? Psychologically the cost of choice can be higher than we realise.
The consequence of more choice is that yes, people can make decisions to fit their preferences, creating happiness. And yes, people can pick and choose options that will improve their lives. But there is a darker side: choice paralysis, the fear of choosing – the responsibility of making the wrong choice. This may make people less satisfied with the choice that they’ve made.
Lighthouses in the dark sea of choice – brands
There are three main costs associated with freedom of choice: opportunity, emotional and cognitive costs. Brands can help lighten this mental burden by acting as a trusted intermediary, allowing customers to delegate their freedom of choice to them. And the benefits of brands run from being decision-making shortcuts to guarantees of quality for their customers.
Take a high-end restaurant’s taster menu for example. It’s an indulgent experience not to have to choose your food and wine and to simply enjoy the meal. Diners arrive unsure of what they will eat and drink, but because of the restaurant’s reputation, the luxury is in not knowing. Customers are willing to lose their freedom of choice for certain brands, placing the responsibility and expertise firmly with them.
I predict that brand tradition is going to become even more important. To achieve trust and reputation, brands need to deliver on their promise. When consumers make brand associations they are able to differentiate a brand from its competitors and to assess whether those associations are relevant to them. But brands cannot change suddenly or radically. Change, whether it’s product, price, place or promotion, needs to take place over time to be believed, it must stem from, and be consistent with, the core identity of the brand. If brands are consistent over time they act as a reference point for their customers, helping them navigate the myriad of choice.
How can companies make choosing easier?
Companies should analyse whether the solution to a product or service problem is to provide more choice to their customers. It might not be. Not enough firms do this: it’s easy to add another option – but it’s harder to strip away.
If more choice really is the solution, companies should provide help to their customers in making decisions. There’s research to support that the presentation of choice, such as organising different options into categories, matters to people. Also, a funnelled structure works well: firms may want to start with presenting fewer product options and then increase the number of choices to make the ‘choosing environment’ more user-friendly.
Companies should strengthen their brand. Companies with a clear brand promise have the ability to provide their customers with less choice and, as trusted experts, instead of leaving their customers feeling let down by freedom cut-backs, they achieve the opposite.
As a result of having a strong brand, companies offer a choice (of sorts) to their customers – who can choose to be brand loyal. If customers choose brand affiliation, they may experience the same sense of power and control as if they had made a product or service choice by themselves.
With brand trust, consumers feel confident that they’ll make the right decisions in the future – deferring to the brand as their decision-making conduit – and in doing so, their level of happiness may benefit.
“Peacefulness follows any decision, even the wrong one,” said the American writer Rita Mae Brown – but is that true? Think back to the high-end restaurant scene, it was the ultimate indulgence because by not choosing, diners trusted that they would be served the best food. There are lots of benefits to experiencing a little bit of mystery in life. There’s a tendency to overestimate the benefits of choice and underestimate the cost. So if choice was stripped right back to basics, could people be happier?
Join us as we imagine the future of business and ask: “What if..?”’ Click here to register and come along to the 2015 Global Leadership Summit held on Tuesday 23 June 2015.