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      Customer Data Platform (CDP)

      What is the Paradox of Choice? Why Does It Affect Online Retail (Key Insights)

      By Carl Bleich

      Jan 10, 2021

      8 min read

      Customer Data Platform (CDP)

      What is the Paradox of Choice? Why Does It Affect Online Retail (Key Insights)

      Making a decision to buy a product from an e-commerce store can feel completely overwhelming when all of the potential outcomes/risks are considered, particularly those that stem from making the wrong choice.

      Studies have shown that humans need the appropriate amount of options associated with choices in order to make the best possible decisions.

      Having too many good options can be frustrating because each option must be analyzed against the others to help determine which is best. Too few options just leave human beings longing for more.

      Hence, one of the ultimate struggles for online retailers: finding the correct balance of having the appropriate amount of products for customers to choose from compared to overwhelming people with things to buy.

      Bloomreach has set out to help businesses mitigate this paradox of choice issue in 2021.

      As the world has seen shopping habits change due to the unforeseen circumstances of 2020, paradox of choice issues should be a major consideration for e-commerce fashion retailers moving forward.

      With all sorts of new types of shoppers online, how can your online retail shop help these new potential customers to not feel paralyzed by the wide variety of options that are now at their fingertips on your website?

      To understand how to best serve your customers, businesses must first have an understanding of who their shoppers are and how they behave.

      While it is impossible to know that information for each individual browsing your website, having a general idea of the population you are serving is essential.

      Phil Graves is a consumer behavior consultant and author of the book Consumer.ology, The Market Research Myth, The Truth About Consumers and The Psychology of Shopping. In collaboration with Graves, Bloomreach commissioned a behavioral analysis study to understand more about the shoppers who have made the shift from shopping at brick-and-mortar stores to shopping online during 2020. 

      According to Consumer.ology, people are extremely bad at understanding their own decision making and behavior. In a sense, humans do not truly know themselves because we are not able to tap into our subconscious mind to understand the root of our behavioral patterns.

      Therefore, setting up your e-commerce shop with the right amount of product choices is essential because it is very difficult to predict how human beings will react to choice overload, or to not having enough options of a particular style or product.

      “Most research is obsessed with statistical validity,” Graves said. “What it completely abandons is psychological validity. To what extent are people capable of answering the questions being asked? Oftentimes, they aren’t qualified to answer the questions because they don’t understand their own behavior.”

      The results of Bloomreach’s study were eye-opening, to say the least. Get our Paradox of Choice in E-Commerce guide to see the complete results and several different strategies that your business can use to alleviate paradox of choice issues with online shoppers.

      Here are some quick hitters to whet your appetite before you download the guide: 

      • Most of the shoppers who made the change from brick-and-mortar to online in 2020 fall into one of these seven categories: sensory shoppers, leisure shoppers, ‘clothes for status’ shoppers, perfectionists, ‘desire to save’ shoppers, ‘fashion follower’ shoppers, and ‘happier online’ shoppers. The guide goes in-depth on how to market to each group and how to avoid paradox of choice issues with each shopper type. 
      • No matter how familiar they are with online shopping, shoppers recognize that there are way more options online. They have access to more stores as they are not limited by proximity, and access to more items as those retailers are not restricted by physical space constraints. If consumers are not able to personally manage the variety of options available, they can begin to feel overwhelmed and encounter friction points when purchasing online. Download the guide to get important coping mechanisms for shoppers in dealing with overchoice issues. 
      • Don’t assume that similarly-aged shoppers behave the same. The research recommends avoiding segmenting shoppers by age because there was no evidence that behavioral or psychological patterns are distinguishable by age. The guide details why. 

      Bloomreach’s Customer Data & Experience Platform is well-equipped to help businesses deal with paradox of choice issues.

      Whether it’s pushing reassuring information to shoppers with a weblayer, using the vouchers tool to send shoppers who want to save a discount, or retargeting relevant ads to users, the CDXP is built to help you retain customers as a business and to provide the best experience for your customers in your online store. 

      Schedule a demo today to learn more and see how specifically Bloomreach helps with customer retention and the customer experience.

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      Carl Bleich

      Content Marketing Manager at Bloomreach

      Carl works with Bloomreach professionals to produce valuable, customer-centric content. A trusted expert with over 15 years of experience, Carl loves exploring unique ways to turn problems into solutions within digital commerce.

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