Virginia MGT 1004 – Business Decision Case

Business Decision Case Choice: “More Is Better” or “Less Is More”?Have you ever felt stuck trying to make a choice when you are purchasing something as simple as toothpaste, orange juice, shampoo, a pair of jeans, or even milk? Do you ever feel like you spend twice as long searching for something on the Internet because there are so many options? And how do you choose among 900 cable channels when deciding what to watch on TV? If the dazzling array of choices presented to you for even simple decisions sometimes leaves you feeling stymied, you are not alone.A well-known consumer behavior study conducted in 1975 by Sheena Iyengar showed how “too much choice” can have an impact on the sale of a product. Iyengar and her students set up a jam (as in jelly) tasting booth at a California gourmet market. Customers were offered a selection of 6 to 24 jams, and each customer was given a promotional “dollar off” coupon to encourage purchase of the jam. Surprisingly, while more customers stopped at the booth when there was a larger assortment (60% compared to 40% for a smaller assortment), more customers bought jam when the smaller assortment was offered (30% for the small, and only 3% for the large).56 Does presenting fewer options lessen the angst over decision making?In his book, The Paradox of Choice: Why More Is Less, author Barry Schwartz concludes that too much choice causes anxiety and can lead to depression. “A bewildering array of choices floods our exhausted brains, ultimately restricting instead of freeing us,” he says.57 Despite these findings, many consumer product companies ignore the fact that too much choice isn’t always a good thing, because to them, more products (resulting in more product lines and product mixes) potentially translate into increased profits. With the lure of profits and goals of increasing brand recognition, these companies continue to create different flavors, forms, colors, package sizes, and added ingredients. Comments a Wall Street Journal reporter, “is it really customers they’re thinking about when they roll-out the 94th variety of toothpaste or the 116th type of household cleaner?! I don’t think so.”58Some companies have embraced the idea that shopper confusion and anxiety can actually decrease sales. In 2009, Glidden Paints decided to reduce its palette of wall colors from over 1,000 down to 282.59 In-N-Out Burger is a classic example of a “less is more” approach with their smaller menu that focuses on quality. Even Walmart is considering the depth (think: product line) and breadth (think: product mix) of product assortment choices.60Apple cut out nearly all choice when they introduced MacBook Pro—over five total products, there are fewer than ten choices.61 But wait a minute. Can you even decide with as few as ten choices?Need to answer the following questions:1. Do you agree with the argument that the vast number of choices actually limits our freedom because of the amount of time it takes to make a decision? Discuss the relationship between choice and the amount of time you spent on a recent purchase.2. Have you ever tried to decide about a purchase only to leave undecided and frustrated? Has trying to make a choice about a purchase ever caused you anxiety? If so, explain the type of purchase it was.3. What products have you purchased recently where you experienced way too much choice and had difficulty deciding? If you don’t ever have this problem, explain why.4. Consumer behavior consultant Philip Graves, author of Consumer.ology, has compiled the following list of some of the reasons consumers have a difficult time making a choice:a) “Difficulty choosing between similar options.b) Difficulty selecting any one option as the better.c) Confusion over which product variable or attribute to attach most importance to.d) Anxiety about how they will feel about a choice they’re inclined toward, knowing that a particular (and also attractive) alternative was available at the time they chose.e) Customers may simply run out of energy (studies show cognitive processes burn glucose in a similar way to physical exercise).”Have you ever had a difficult time deciding because of any of the factors listed, and if so, what was the impact on your decision?balapand posted a question· Nov 1