S1 Ep7 Too many choices kills sales

[Music] More options should help, yet sales drop. People scroll, compare and then do nothing. Not because they don't want the product, because the decision feels like work. Welcome to ThinkShift, the podcast where neuroscience meets business. Today we're unpacking why too many choices kill sales, and how to simplify without losing revenue. If your pricing page has four or more options, this matters. [Music] Hey, Clint. Hey, gone. Yeah. Big week, huh? He sure has. Yeah. He's been a lot going on this week. Yeah, all good stuff, all good stuff. Yeah. Yeah. Okay. Whether it's been good. Yeah. It's been fantastic, isn't he? Yeah. But now we're ready for another big podcast. Yeah, no, I can't. This is a good one. Okay, so. Rather all good, but this is extra. Extra good. Yeah. One of my favorite biases, well, and not for, favorite biases to talk about and to teach, but not to use. Yes. Not to use. Okay, so let's talk about the science behind it, what it is. Yeah. So more options should help, you would think. You would. Yet sales drop, so it's not a pricing problem, then. It's a brain problem. What is choice paradox in plain language? Yeah. Too many choices. Too hard. So it's hard. It creates a cognitive overload. We think, unfortunately, the more the better, but actually it's very detrimental to ourselves and to our conversions. So what often happens is that we think, I'll have option A, option B, option C, option D, EFG sometimes, thinking, oh, we've given you all this choice. Works against you. And it works against you. And you see it out there in the Bricks and Morrowold too, right? Absolutely. And you're like, I'm not going to pick on. Braks of clothing. I'm not going to pick on a culture, but there are particular cuisines. Yeah, there is. Yeah. Have so many options on the menus and you walk in there and you're like, I don't know what I want now. If you just give me four options, I would have chosen one, but now you give me a thousand and you just sit there frozen. Absolutely. Not only that, what has happened to me in the past where I've gone to this particular cruise, and I'm going to, oh, I feel like blah, blah, blah, blah, that I've gone in and go, now I don't know. Yeah. So I actually made a decision that I feel I think I'm going to get this. And then I'm presented with this complexity that now is question my own judgment. Yes. What an eight. Yes. Yes. I've been in business all the time. Yep. So what is the regret mechanism here? That we often fear picking the wrong thing or we don't know what to pick. Also, so I know we say we don't want to use jargon or acronyms, but there is one that I created a long time ago, which I know now we circulating instead of FOMO is Foboe, F-O-B-O, Fue of a better option. So what's happening is we're not not making decision. There's a lot of different choice. So not only is this all too hard and we're walking away, but we're actually thinking, I might be better down the track. And we actually saw this, particularly last year, within Australia in particular, just because of the national economy and also we've now got the global economic crisis where we didn't want to commit, we didn't know what was going to happen. So sales cycles actually exploded beyond 80% longer. And a lot of it was around Foboe, but fear of a better option. What happens if I choose the wrong thing? What happens if something's better? What happens if someone else chooses something that I should have chosen? It's like, "Oh, what choice do I want to choose on the menu?" And then you get your dinner, you get yours, Clint and I go, "Oh, wish I chose that." That's so common, isn't it? I know. envy, food envy. Yeah, so fear of being judged is another one. Fear of being judged. Is that acronym as well? Can we acronym that one? Is that FBJF2? FBJF2? Fear of judging option? Yeah, we can create our own dictionary really when I mean, gosh, we have our own glossary with all the biases, don't we? Yes. But it's, yeah, for judge picking the wrong decision, not knowing. It's too hard. It's too hard. I'm too scared. It's high risk. The brain is designed to protect us. I know we're not going to get killed by this, but the brain is designed to increase quarter of the total. We're going to get killed by this. Five choices there. Take a quick break now. If our list is out there, call it a like and subscribe to the Thingship podcast. You can keep up to date with what's happening with us. There's only memberships. There were so many good, weakly, daily, monthly, then there was different payment terms. Then there was different payment terms. Then it's if you wanted different levels of money. It's if you wanted different levels of money. People like, "Ah-ha, I'm going to choose this." More members came there. Their membership cohort actually increased exponentially. And in fact, the politi's portion of the business in particular. You couldn't even get a bit. You couldn't book a bit. They were booked four weeks in advance. So so popular because people had clarity around the memberships that were suitable for them. And what worked rather than just being bombarded with all these different options and not knowing what to do. Yes. It's funny you mentioned health businesses there. So frequent. It's such a common thing to want to provide so many options in membership level and tier. And then within those tiers is you can have this. You can put that in. You can take that out. It's like, "Oh my God, just give me just give me an option. Just one option. This is too hard." Health insurance. For any kind of insurance really. But even pen insurance. So I've got two sausage dogs. Those that have listened to us before. Daphne and Audrey. And trying to work out the different options. The different options, then inclusions, then these, then that. Then if you, what you pay up front, then you're, your extras and then the excess. Yeah, excess. And thank you. Then you've got options not only the different excesses, but then you get a hundred percent back. Or you get 90 percent back. You get 80 percent back. Or 75 percent. What's the difference? 80 and 75. I mean, I get it. But oh my goodness. And I had to still on the phone. For hours trying to work out what was best for them. And it's got to be easier than that. So it's going to start going on. Got to be easier than that. But the thing is they're all like that. So I couldn't even walk away from this and going going elsewhere because if I looked elsewhere, it's the same. So the whole industry is like that. And it's so complicated. I think that's where businesses like compared the market, you know, and they're select in those insurance aggregator companies are so powerful because they take all of that. Do that for you. Yeah, they do it for you. So the choice paradox becomes a non-event. It's just a clear path. It's the minutes. Yeah, not gone completely, but it is definitely reduced. And that's why they're so successful. Right. So the consumer would rather sit there and run through one form with questions and then have a table of all the desirable and relative businesses that offer insurance at the price point that they offer it out. So I can see why. Yeah. All right. The second zone is product ranges and category browsing. So what that looks like, endless grids. Right. So product after product to product to product product, product range range range filters that create thousands of combinations. That just makes it so hard, doesn't it? Like you just flick on filtering on the side and it changes the color of the style. And he just don't know where to go. To be honest, I've stopped using filters. Right. I have found that when I have maybe ticked a color or two, especially with clothing ticked, well, ticked a color, I end up it's more complicated. Yeah. It's created categories or a combination that actually didn't want. So my better off just plowing through it myself and then me doing using my own filter, a cognitive filter of yes or no, yes or no, yes or no. Yeah. Rather than you know, pink gold platform strap. No, it's just I can just do yes, no, yes, no, yes, no, and find my own filter is often easier than using you know selected filters or categories on a website for instance depending on the what it is. I find that a really interesting example because Amazon is great at thousands of filters in my own experience when I use Amazon. I don't flick any of them except for show me products that are in Australia and same day delivery. Yeah, tick those two and the rest time kind of like you show me what I should see. I want you. Yes, no, I don't I don't need to filter filter all the way down and then you show me things I may or may not want because again fear missing out on a better option. Yeah, Bobo. Bobo. So yeah Amazon really good example of that. What else is there on on zone two we have no guidance for first time buyers. Yeah, I've got here, you know, how to spot it. People bounce after browsing. Yeah, and that's that's that's you know, that's key. So I guess if you're a business you're looking at how to reduce that you look at your analytics and see. Yeah, what's the bounce rate like is it's super high? Are people coming and leaving and coming leaving then you know particularly on category product pages on an e-commerce website. Yeah, if that is a high bounce rate then you know it's possibly a choice paradox issue. Yeah, cognitive overload and all the rest. Absolutely. Yeah, and when you're talking about you know category browsing like to bring in the horizontal versus vertical interpretation of how we we including you know misattribution error and how we actually look at things from left to right or top to bottom. And you know generally speaking we go left to right as browsing. So we're having a look to see which is what you've got you know your menu bar. We haven't looked to see you know what are the options what do we want then when we go to a vertical that's more specific. Right so what's like you know do you want t-shirt jeans shoes dresses shirts jackets are one jackets then it's like do you want a blazer and overcoat a bomber. Bomb a jacket a yes a vest or a faux fur like what is it so we're being specific but what I often see is that people are expecting when they hit the vertical to keep browsing. So the vertical option is a choice paradox where it's endless yeah endless choice vertically and then it's but we are already so the brains already decided that I want I'm going to go to the jacket category. I'm expecting a short list of jackets yeah to choose from yeah not long long you know pages and scroll worthy you know pages of no so it's there's a disconnect with the. Disconnect with the expectation of the braids decision and what I'm seeing I I that is something that drives me insane so fixable so fixable with your horizontal and your vertical you know browsing and definition of product but people just don't seem to do it because I don't think they understand and hopefully this will give them some insight into that yeah round the choice paradox yeah So zone three if we just move on a zone three and so feature lists in comparison yeah what that looks like is you know feature bloat yeah yeah just endless dreams of feature feature feature feature instead of focusing on the solution that it's going to provide we focus on the features and the product features and benefits features and benefits I call it features and benefits selling it drives me insane yeah it's not like oh but it's got these and it's got these like I don't care can it solve this problem that's right that that's what I'm looking for that's exactly right every feature being treated as equal and I think I've got here you know how to spot it people scheme and they stall you know they just kind of go know you've got to leave the page and go somewhere else yeah question here for you though why is recommended in inverted comments why is it so powerful and someone sees recommended above you know a featured product or says recommend yeah so comes back to another bias called you know isolation effect or Von Ristoff effect so Von Ristoff with a female baby Dutch behavioral scientist where something that stands out always isolated like having most popular or recommended will work and so we draw the attention to that there's there's a positive and an negative it can also backfire right but in a positive way it stands out it's safe we look at it as like oh it's recommended it's safe other people have tried it and it's been okay or somehow you have decided for me this is what's best yeah but how it can also backfire is well how do you know what's best for me it can be a little bit salesy it's is it because and this is a little bit of saturation of this in the market like scarcity is it because your inventory is high and you're trying to get rid of like there's all sorts of things that we think of you know you don't know me well enough to know that this is should be what you're recommending to me so there has to be a connection first before we get to a recommended page or recommended product and I know we talk about dark patterns in previous episodes is that you know it's recommended small dark pattern because you're recommending something it's what's that's better for the company selling a product that throws it better for the consumer that's buying it well if it's a better for the consumer no problem if it's if it's better for the company we've got a malt dark pattern yeah so there's a strategy on MO behind why that why that's recommended now there could be a little reason and that's cool but often they can yeah they can easily backfire so you need to be careful with that so when it when it's backfires it's feel salesy yeah it's not explained as to why is it recommended yeah and when it doesn't match the user's goal they're kind of like seeing feels off but there's a is a bit unconscious feeling of this feels wrong for me I don't know why they're recommending it so that's complete backfire all right so we're going to move into business here so as a business how to simplify without losing sales right so simplifying isn't dumbing down it's reducing cognitive load we talk a lot about cognitive load on this podcast so a question for you would be what are the most common mistakes business make here you firstly into too many options because you're not sure of your target market or your persona or the people that you're selling to all often broadening your expertise rather than saying well this is what we're really good and this is what we're going to offer maybe if we broaden it will get more clients doesn't work like that you're peeled everyone you know one yeah you talked about this this morning didn't yeah so it's actually understanding exactly what your product is about and who is it suitable for you're trying to try to please everyone you can't do you want to yeah no you know I'm not saying to be a hard I was you know you're kind caring person but you don't have to please everybody you know you're an expert for a reason you know I'm an expert for a reason you're an reason Clinton our listeners are experts for you know there's reasons behind their expertise as well stick stick to that and showcase that also just being unsure so just blur in the edges and blur in the lines you know and and crossover in in products yeah crossover in memberships across over in subscriptions do you really need that how can you remove some of the options yeah you've laid down on the table simplified it's almost like that that lowest hanging fruit and allergy where pick the lowest hanging fruit in terms of persona and the person you're trying to target and just direct everything to that you'll get outlier buyers of course you'll get ones that don't fit your key persona but if you focus on the 80% then you'll get a much better a higher conversion rate yeah yeah that's right okay gonna talk about some quick wins yeah so cut a pricing tier unless it's you know what would you say is the optimal three yeah three so that very quickly didn't I that's a common question that comes up and that I get asked I mean three is optimal anything with an odd number and and it's saying that you know makes me cringe because I am OCD if you haven't worked that out and odd numbers is one of the things that gives me a bit of anxiety so you know with your volumes needs to be on a on a on a positive number when I was done a lot of travel you know globally in my corporate role and I used to if I you know where you sit on the plane like if it was an odd number row I would do whatever I could whether it was addition subtraction multiplication to try and get an even number same with hotel rooms or I've done the work it's just hilarious it well funny but sort of not but having said that come back to question three absolutely so what happens is the brain we like to to centralize or we use something in midline which is a point so that's our reference point on midline so that's say one option and then you have one either side so even though it's odd and you think it's a symmetrical it's not it's balanced and it creates symmetry so you got one of midline and symmetry so you got one midline one either side if you want to go five options you got one midline truly the side however we started getting into choice paradox with five and above so three you want more than two and you do not want four okay interesting but three is the optimum the brain loves three in all different capacities and ecosystems even steps processes yeah yeah three three optimal yeah what do you think I when the output of information and text that you get has the has the rule of three hmm so it's those times those times right so you have something something comma and you know let's not even talk about the m dash here but yeah one two now that's how we normally we normally write and that's how I write. when I publish articles, but it's become a common theme in terms of the way the algorithm writes. And that's purely because cognitively, that's how the brain finds creates ease, cognitive fluency and cognitive ease. Yeah. So people say, don't write in the power of three because it looks like AI, the problem is you need to, because that's what the brain actually wants. Yes. So another quick win here is create one recommended option, but explain why. Yeah. Always explain why. Always have it there somewhere. So the user knows like why you've recommended it. Another one is replace feature lists with outcomes and trade-offs and group products into a few clear decision buckets. So make it really simple. Don't give me a thousand options. Show me what you recommend. Why? And I'll buy that. Okay. Some measurement focus focuses that we could put here as well. So tracking at the cart rate, tracking check out starts and completions, where are users coming in, where are they leaving? So track time to decision on key pages, and track support questions, signal confusion. And I think the support questions are one of those things where if you get enough support questions, you create your FAQ page. Yeah. Is that that determines what people are asking, but that also brings up another big question around user experience. And that is if users are having to ask those questions, that means your pages are saying what they should be saying. They should need to find the FAQ. Yeah. You know? I want to, before we wrap up, I want to touch on something around a study from Columbia University as well. Very famous Jam study. This will, so you know, those that are listening and watching will solidify exactly what Klin and I are talking about here. So what happened in this study was in 2000, is they had an experiment where they put together a beautiful display of 24 jars of jam. How to on display that it attracted around 60, 65% of shoppers. Everyone wanted to look at it. You know, it drew them in. However, only 3% of shoppers made a decision and purchased. They then removed 18 jars. So they were stuck with just six. Obviously it didn't attract anywhere near as many shoppers because the display wasn't as glamorous and as elaborate. In fact, it was only 40% of shoppers that it attracted. But out of that 40% of shoppers, 30% made a purchase. Yeah. So this example, I mean, I teach this. It is this exact idea. Yeah, I do. And I do remember. He's kind of, yeah. But it's such a clean, I've got a little, little cool graphic that I use too. It's so clear in explaining, you know, what works and what doesn't work and why when there is just too much choice. We don't know. They didn't know what to choose. You know, there's 24 here and the jars of jam. Something that's quite simple, you know, in our businesses. And for you guys, there's a lot more complicated than a jar of jam. Yeah. You know, I would say. Yeah. So let's even add that complexity on top of it. That it's a lot more complex than a jar of jam as it should be unless you are a jam cell. And that's pretty cool. And that's the effect it's having. Down to the six jars. Look at the effect that had. Think about that model and think about that piece of research in your business. What can you do to make some changes? Yeah, excellent advice. 100%. Here's the shift. More choice does not feel like freedom. It feels like work. When choice feels like work, people delay. When they delay, they do nothing. Fewer choices convert. One action for the listener this week. Pick one decision point on your site. Pricing product page. Chloroform. Remove one option. Then make the next step obvious. And that's think shift. I'm Clint. I'm Leanne. One idea won't shift in under 30 minutes. If this changes how you think, share it with someone who makes decisions for a living. And follow think shift on all the socials. Don't forget to like and subscribe so you don't miss what shift is coming up next week. See you in the next episode. See you soon. [Music] This is a much made media production.