Consumers generally prefer having more options when choosing among products but not when making choices involving the distant future, according to a new study in the Journal of Consumer Research.
"The lure of assortment may not be as universal as previously thought. Consumers' preferences for large assortments can decrease due to a key psychological factorpsychological distance," write authors Joseph K. Goodman and Selin A. Malkoc (both Washington University in St. Louis).
Retailers have known for decades that consumers prefer large selections and are lured by more options and greater variety. For example, when planning a family outing to an ice cream shop this coming weekend, a consumer would most likely choose the local shop offering thirty-three flavors over another in the neighborhood offering fewer options.
How universal is this demand for more choice? Are there instances when smaller selections are acceptable or even desirable? The authors found that consumer preference for larger selections decreased for decisions involving psychological distance when consumers had to choose between restaurants, ice cream shops, chocolatiers, home appliances, and vacation packages. Psychologically distant events take place in a far-away location or in the future.
Psychological distance is common concern when consumers are making decisions related to the future such as vacation, insurance, or retirement planning. In such instances, consumers tend to focus on the end goal and less about how to get there. When planning a vacation that is months away, a consumer would probably prefer to hear about fewer dining options in the city they will be visiting than if their vacation was coming up in less than a week.
"In product categories where psychological distance is automatically evoked, it might not be necessary for retailers to offer a large (and overwhelming) number of options. Consumers may even be attracted to those sellers offering a smaller and simpler assortment of options," the authors conclude.
Explore further: New poll reveals what Americans fear most
More information: Joseph K. Goodman and Selin A. Malkoc. "Choosing for the Here and Now vs. There and Later: The Moderating Role of Psychological Distance on Assortment Size Preference." Journal of Consumer Research: December 2012.