Paradox of Choice

What Is the Paradox of Choice?

Think about the times you have gone to the grocery store. Have you ever walked down the cereal aisle and thought, “wow, there are so many options, how can I choose?” If you have felt overwhelmed by the number of options available to you, whether it was varieties of cereal or cookies or tea, then you are not alone. The Paradox of Choicexeven though a decision-maker may think they want more choice, having too many choice options can have negative consequences for the process of making the choice and for how the decision-maker feels about the choice is a key theory in behavioral science and marketing that explains how consumers, when faced with many choice optionsxthe items that are available for an individual to choose from, react negatively and then struggle to make an effective choice. Generally speaking, a choicexthe act of selecting one option from a set of two or more options is the act of selecting one option (e.g., a type of cereal) from a set of two or more options.

People living in Western cultures (e.g., Americans, Canadians, Europeans) tend to place a great deal of importance on independence, the ability to make their own choices, and personal freedom (this latter value is especially strong in the United States). These choices can vary from critical decisions about healthcare plans to relatively insignificant decisions about which type of cereal to buy. People value choice because it tends to make them feel independent and in control of their lives.

Given that having a choice is typically viewed positively, having many options to choose from should also be viewed positively. The seemingly endless variety of food options and other products for consumers to choose from reflects the attempt of marketers to meet consumers’ demand for choice. However, the Paradox of Choice suggests that although consumers may think they want more choice, choice overloadxwhen an individual feels overwhelmed by the number of choice options they have when trying to make a choice. choice overload will often lead the decision maker to make a poorer choice that they will later feel dissatisfied with can leave consumers feeling overwhelmed, hinder their ability to make decisions, and lead to feelings of regret, anxiety, depression, and dissatisfaction. Thus, having too much choice may in fact be a bad thing.

The Paradox of Choice also describes how consumers go about making a choice. When an individual must make a choice (e.g., of what type of cereal to buy), they must first identify what goal or need the choice is intended to meet. In the example of purchasing a type of cereal, if a consumer’s main goal is to eat healthier, but a secondary goal is to buy a cereal that is tasty, and both goals are important, then when they are faced with an array of cereal options, they may first evaluate each cereal based on the healthiness of the cereal. For instance, what cereals are low in sugar and high in healthy grains? Then, from the selection of healthy cereal options, they will choose one that best satisfies their secondary goal of finding a tasty cereal.

Schwartz (2004) suggested that some consumers become focused on finding the choice option that is the absolute best. These people, called “Maximizersxan individual who exhausts all choice options to ensure the option they choose is the absolute best in terms of achieving a specific goal or meeting a need. Maximizers tend to feel less satisfied with and more regret about their choices,” compare all choice options to ensure what they buy is the absolute best in terms of objective metrics, such as quality and price. Maximizers tend to be very focused on achieving a specific goal (e.g., the highest quality and most affordable option) and tend to be less satisfied with and feel more regret about their choices. Another type of consumer, called “Satisficersxan individual who tends to make choices more quickly than Maximizers and also tends to feel more satisfied with and less regret about their choices,” will settle for an option that is good enough and are less concerned that a better option may be available. Satisficers tend to make choices more quickly than Maximizers and also tend to feel more satisfied with and less regret about their choices.

Importantly, having choice is not a bad thing, and having the ability to make choices typically does improve the quality of people’s lives. However, the Paradox of Choice captures when consumers are faced with too many choices (e.g., you have to make a choice for every type of product you purchase, from cereal, to juice, to headphones), and there are too many available choice options (e.g., too many varieties of cereal).

Video. Paradox of Choice

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The Paradox of Choice (Schwartz, 2004; Schwartz & Ward, 2004) describes how people make a choice when they are faced with a large number of choice options. Given that people are routinely faced with a wide array of choices in their daily life, the number of choices that an individual must make each day can become overwhelming (Schwartz, 2004).

The foundation of this theory came from consumer behavior research showing how limiting people’s choice options led to greater satisfaction with the choice. For instance, in research conducted both in laboratory and real-world supermarket settings (Iyengar & Lepper, 2000), consumers who were offered six different jams or chocolates, as opposed to 24 jams or 30 chocolates, were more likely to actually make a choice and feel more satisfied with the choices they made. Interestingly, Iyengar and Lepper (2000) also showed that giving people more options did not change whether or not they satisfied (chose an option that was good enough) or maximized (chose the absolute best option). The majority of people in these studies, however, used more of a satisficing strategy. Furthermore, at least when making a choice about chocolate, people reported enjoying the choice more if they had a larger selection of chocolates to choose from; however, those with more chocolate options tended to feel less satisfied with the chocolate they chose. This example highlights a key finding of the Paradox of Choice, in which people often think they want more choice, when in reality having too much choice can lead to negative feelings of anxiety and choice dissatisfaction.

The Paradox of Choice emerges not only when people make choices of food items at the grocery store but can be applied to important decisions such as retirement plans (Sethi-Iyengar et al., 2004), prescription drug plans (Iyengar & Kamenica, 2010), or the amount of choice that employees in organizations are asked to make (Chua & Iyengar, 2006). For example, research on retirement plans (Sethi-Iyengar et al., 2004) shows that as the number of retirement options increases, retirement plan participation rates decline, suggesting that just as with jams and chocolates, providing too many options can have a negative impact on retirement plan choice.

Taken together, what does this all mean? Research across the last two decades has consistently shown that giving consumers fewer options to choose from improves their ability to make a choice. Selecting from a smaller number of choice options also tends to make people feel more satisfied with the choice they make.

It is important to keep in mind that the Paradox of Choice (that fewer choice options is better than more) may not apply in every context. Research on financial investment decisions (Kida et al., 2010), for example, has shown that the Paradox of Choice only applies to individuals who do not have investment experience. Those with investment experience actually show the opposite pattern; that is, people who have more experience with making financial investment decisions are less likely to make the choice to invest when they have fewer investment options. Furthermore, when offered only a single option, people will often prefer to search for alternatives before making a choice, a phenomenon known as single-option aversionxwhen people are offered only a single choice option, they are less likely to choose that option and more likely to search for other options (Mochon, 2013). Research on single-option aversion suggests that an option will be selected more often when there are other alternatives in the choice set.

Another limitation of the Paradox of Choice is within the context of shopping behavior. For instance, when consumers are faced with a product choice that is more difficult to return, they often prefer a larger variety of options to choose from than when the product is relatively easier to return (Boyd & Bahn, 2009). This suggests that the relative riskiness of a purchase that has little to do with the product itself can influence whether the amount of choice is perceived to be better or worse.

Other critics of the Paradox of Choice argue that it contradicts theories showing that having at least some choice improves the quality of people’s lives by providing them with a sense of freedom and autonomyxthe perception that people are independent agents who are in control of and able to direct their own actions (Deci & Ryan, 2000; Ryan & Deci, 2000), or the perception that one is in control of and can direct one’s own actions. This sense of freedom and autonomy is especially important for American consumers who tend to value being independent and self-sufficient (Markus & Schwartz, 2010).

A key difference to keep in mind when comparing the Paradox of Choice to other theories of choice is that while it is true that having at least some options can aid choice and help consumers feel more satisfied with their choices, the Paradox of Choice describes what happens when a consumer perceives that they have too much choice. In other words, when they experience choice overload.

The latest research on the Paradox of Choice has expanded to other real-world contexts like voting (Cunow et al., 2021) and online dating (Pronk & Denissen, 2020) to better understand how people make choices. For instance, when voters are presented with many political candidates to choose from, they learn less about the candidates, are more likely to choose a candidate based on irrelevant information such as the position of the candidate’s name on the ballot, and are more likely to accidentally vote for the wrong candidate (Cunow et al., 2021).

Choice overload has even been shown in the context of online dating. For instance, although people may report wanting more dating options, they also tend to underestimate how quickly the number of dating options can become overwhelming (Lenton et al., 2010). A more recent set of studies (Pronk & Denissen, 2020) also showed that too much choice in an online dating platform leads people to be more likely to reject potential matches. Just like in other choice overload contexts, when there are too many options to choose from people will adopt a “rejection-mindset” and may even become closed off from exploring dating options.

An important question to ask is exactly what number of choice options is “too many”? The answer depends on what choice the person is making. People may actually want more choice when making a decision about a product they are familiar with than a product they are relatively unfamiliar with. For example, in the case of cereal, people may be more tolerant of a larger variety of cereals if they already know what varieties of cereals they prefer. In addition, choices that could have a longer-term consequence, such as selecting a future retirement plan, may be more overloading if there are many options because making the wrong choice could lead to longer-term negative financial outcomes in the future.

More research on the Paradox of Choice is needed to fully understand the real-world situations in which having more or less choice is beneficial versus detrimental. For example, it remains relatively unclear when people do and do not experience choice overload in digital environments (e.g., when searching for information online, when browsing an online streaming service like Netflix, or even when shopping online versus in-person). There is even some research to suggest that choice overload matters less on an online shopping platform than in a physical shopping environment (Moser et al., 2017). When deciding how much choice to offer consumers, it is important to keep in mind what the product is, if the product is being purchased in-person or online, and whether the consumer has prior experience with and preferences about the product type.

When to Apply the Paradox of Choice Versus an Alternative Theory

The Paradox of Choice is a relatively general theory that can be applied broadly to help marketers understand when consumers are likely to respond positively or negatively to a choice. This theory can also help marketers understand how and why a consumer may make a choice when there is a limited versus large number of options to choose from. The Paradox of Choice has been readily applied in real-world consumer settings, from everyday products like varieties of jams, to more consequential choices like which retirement plan to choose, who to vote for, what car to buy, or who to select from an online dating app or website.

Alternative theories of choice will be more useful when the choice option setxthe set of options (e.g., specific varieties of cereal) that an individual is considering in their choice is limited (there are a smaller number of options to choose from), or when individuals are choosing several items at the same time. In the case of a limited choice set, single-option aversion (Mochon, 2013), also discussed above, is especially relevant. Consumers faced with a single choice option are less likely to choose that option and more likely to search for other options, than when a choice option is offered alongside competing alternatives. Although there are a number of plausible reasons why the single-option aversion effect occurs, a possibility is that viewing one option sparks consumer feelings of curiosity, hope, or even uncertainty about whether an even better alternative may exist. When individuals are choosing several items at the same time, the theory of variety-seekingxa choice phenomenon whereby people tend to choose multiple options from a product category (e.g., multiple varieties of yogurt) when making choices on a single occasion (e.g., grocery shopping trip) (Simonson, 1990) may be more relevant. Research has shown that consumers will choose a variety of options when they have to select more than one product of a given category at one time. For example, a consumer who is purchasing yogurt for the upcoming week will often purchase several different types of yogurt (e.g., strawberry, blueberry, cherry, blackberry, key lime, banana, peach). However, if that same consumer went to the store every day to buy yogurt, they would be more likely to select the same variety of yogurt again and again (e.g., strawberry each day). Variety-seeking suggests that when people make choices at the same time about products they will consume in the future, they tend to mispredict what their future preferences will be and this leads to more variety-seeking. In other words, although variety-seeking often looks like a preference for having more choice options (potentially counter to the Paradox of Choice), it is actually a reflection of consumers not necessarily being good at predicting their own future preferences.

The Paradox of Choice is most relevant when there are many options that a person must choose among and when the individual must choose only one option. This theory may be especially relevant when people have less experience with the choice domain (e.g., health insurance, retirement plans) or think that the outcome of their choice is more consequential (e.g., having poor health coverage) or riskier (e.g., a product that is more difficult to return or exchange).

How to Apply the Paradox of Choice

A marketer must first provide enough choice to the consumer that they will find an option that satisfies their goals and/or needs, but not so much as to create choice overload.

The steps below outline how a consumer can approach making choices (adapted from Schwartz, 2004) in order to reduce the possibility of choice overload. Marketers can aid consumer choice and reduce the likelihood of choice overload by creating advertisements and promotions that encourage consumers to do the following:

• Step 1: Identify their goal(s)/need(s) for the choice
• Step 2: Evaluate the importance of each goal/need (which one or two are most important)
• Step 3: View the choice options that are available
• Step 4: Narrow the choice options to those that meet their important goals/needs
• Step 5: Pick the “winning” option (this does not have to be the “absolute best” option, but one that adequately meets their most important goal(s)/need(s))
• Step 6: See how well the choice meets their goal(s)/need(s) and modify the choice in the future, if necessary.

Finding ways to guide consumers through the process of making a choice is critical. Helping consumers identify their goals/needs and highlighting how a choice option (e.g., product) can meet these goals/needs better than competitors can help reduce their choice overload, negative feelings, and concerns about anticipated regret. If there are many choice options available, but only a few of these options meet their goals, then consumers will be better able to narrow the choice options down to a more manageable, less overwhelming set to choose from. Providing consumers with some sense that they can make a different choice in the future, if their current choice turns out to be unfavorable, can also help reduce negative feelings during the choice.

For instance, imagine that a consumer has a goal to eat healthy and so frequently goes to a restaurant that specializes in healthy salads and grain bowls. When faced with many different options on the menu, a consumer may be overwhelmed by the number of available options. This restaurant can both meet the consumers’ healthy eating goals and help reduce choice overload by offering a promotional item, for example, a special salad or grain bowl of the week. Featuring this special healthy item will help narrow the number of choice options consumers are considering. Not only can this help the consumer more easily make a choice (e.g., of the special “salad of the week”), but it may be likely to draw the consumer back to the restaurant each week to try a new item. Knowing that other options will exist in the future can also help attenuate any dissatisfaction that consumers may anticipate feeling about their current choice.

These steps could also be applied in a variety of other choice contexts, from grocery shopping to clothing shopping, to choosing a retirement plan, healthcare plan, date on an online dating service, and beyond.

Field Report: Theory in Action

Marketing professionals must think carefully about how many choice options to offer clients. Too many options and a potential buyer will be overwhelmed; not enough and they may feel disappointed, a lack of autonomy, and may even want to search elsewhere. Watch the following video from marketing expert Kevin Garcia to learn how he strikes this balance in his work as Head of Product Marketing at Retool.

Video. Interview With Kevin Garcia

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