8 March 2008 - 10:41How many options is ‘just right’?

In a business there is always a balance to be struck between offering enough choices to your customers and overwhelming them.  There are two great TED talks that in their contrast describe the merits and dangers of choice.  First, in favor of more choice-

Their spiel: In this witty monologue, Malcolm Gladwell follows the career of a food industry consultant who uncovered a key secret to what eaters like. Running huge focus groups to find customers’ truest tastes, Gladwell’s hero draws a radical conclusion, an epiphany that has defined food marketing ever since. Note: The theme of the 2004 conference was “The Pursuit of Happiness” — hence the talk’s quirky presence.

The brilliant observation that Gladwell and his food consultant hero make is that people like distinct categories of things, and an effort to find the “perfect” combination ends in mediocrity.  For spagetti sauce there are categories based on spice, viscosity, “visual chunkiness”, etc.  Depending on their mood or preference people can like a rather bland and thin sauce or a meaty, thick and smooth sauce.  There is no “perfect” sauce.  The food industry embraced this with a passion and made a fortune.

This applies to all tastes, all activities for which people can have a preference.  It is genius.  Example- Entertainment.  Certain types of entertainment can be combined to good results, like a football-comedy movie.  But try and combine the joy of watching your daughter perform in her very first play and the rowdy pleasure of a Superbowl party and both will predictably suffer. 

The problem comes in choosing which categories to present to the customer, finding which “types of sauce” are popular as distinct categories.  You may miss a category altogether and miss out on some business, combine two categories improperly and ruin both or you can bury the customer in a sea of choices.  Which brings us to Talk #2-

Their spiel-Psychologist Barry Schwartz takes aim at a central belief of western societies: that freedom of choice leads to personal happiness. In Schwartz’s estimation, all that choice is making us miserable. We set unreasonably high expectations, question our choices before we even make them, and blame our failures entirely on ourselves. His relatable examples, from consumer products (jeans, TVs, salad dressings) to lifestyle choices (where to live, what job to take, whom and when to marry), underscore this central point: Too many choices undermine happiness.

I think Barry missed an important point, which is that it is not the freedom of choice which makes you miserable, it is the uncertainty of making the right choice which makes you unhappy.  More choices to some degree makes it harder to be right, but it does not scale directly with choice.  In his opening example he describes how jeans used to come in only one basic style and even though they did not fit all that well he felt content in his selection.  One day he goes to buy jeans and there are a dozen styles.  He ends up buying a pair that fit better than before but is miserable because he isn’t sure that he really bought the ‘right pair’.  The contrast I want to make is that a sixteen year old hipster would not only have been delighted at all the new options but would have bought multiple outfits, for the first time finding exactly what they had always wanted. 

The trick in my mind seems to be providing the most popular categories of your product while making it as clear as possible what the differences between each product are so that every customer can choose their selection with confidence.  Windows Vista Ultimate/Basic/Premium/Business/Enterprise, you have failed this test.