The paradox of choice effect: How to combat shoppers’ indecision?

By Sasha Fedorenko June 13, 2019 - 10:48 am

The ‘paradox of choice’ effect was first coined by the US psychologist Barry Schwartz who argued that eliminating consumer choices can greatly reduce anxiety for shoppers. The term is 15-years-old, but its message is more relevant than ever before.

The advent of ecommerce saw eBay and Amazon using the choice of products to differentiate their platforms – but its, not the only reason why they’ve done so well in the last two decades. However, the proliferation of choice coupled with multiple calls to action and other marketing messages can be overbearing for consumers. This raises a question. How can sellers reduce shoppers’ indecision to purchase the right product?

Personalisation as a key to filter out irrelevant products

Sellers need to ‘nurture’ customer interest from the initial research phase through to the closure of a sale. They need to be “smarter” in how they offer this variety, says tech expert Conversity.

Online marketplaces have implemented personalised features that help customers to make up their mind. Recommendations for similar products, relevant cross-sell opportunities appearing on-screen or suggestions for repeat purchases – all of these have made a difference in driving purchases and customer loyalty.

According to Made-to-order: The rise of mass personalisation report by Deloitte, one in five consumers who express interest in personalised products are willing to pay a 20% premium. Some 22% of shoppers say that they’re willing to share personal data in exchange for a customised shopping experience. The analysis gives four key ways through which sellers can tackle shoppers’ indecision:

Related content personalisation

Amazon are using related content personalisation to deliver individualised recommendations to shoppers. It works by analysing shoppers’ data and the behaviour of other shoppers to push relevant suggestions to reduce the bounce rates.

Account customisation

The most common form of personalisation is when a shopper can personalise content once they have created an account. Customers can identify their preferences by logging in to their account. This involves adding or removing content and customising quick links to content they regularly access. It is possible to do account customisation without a customer logging in by relying on cookies.

Internet Protocol optimisation

IP customisation attempts to identify the user through their IP address. This allows sellers to know where a shopper comes from to personalise their content that reflects their needs. This might involve changing homepage content to provide quick links to the content of specific interest to that customer.

Geographical personalisation

Geographical personalisation customises content based on customers’ location. For example, users from the UK landing on a US website might be redirected to a page specifically designed for the UK customer. Another example of geolocation where a beacon picks up signals sent to mobile phones, allowing a store to track customers’ movement within and outside a store. The technology can also send customers geo-located messages about special offers and personalised promotions at sellers’ stores close-by.

The competition for customers’ attention intensifies. It has never been more difficult for sellers to convert browsers into shoppers. This is due to the increased choice fueled by the growing competition. Merchants can support their shoppers in eliminated irrelevant products by using personalisation as a tool to tackle shoppers’ indecision.

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