Chances are you know the perils of having too many choices, but it turns out providing both customers and staff with multiple options can actually make them less productive and less likely to buy.
Combing through the research archives can be a great jumping-off point for revamping your processes, and this 2013 piece of research out of Stanford University suggests you might be better off giving people less freedom, rather than more.
As part of a series of experiments on driving action and human behaviour, researcher Szu-Chi Huang trialed customer’s approaches to different styles of loyalty cards, explains Stanford Business. Among the variables included how many different methods a customer could use to move towards getting a free drink.
The findings suggested that for those already with some progress under their belts, like a few stamps already accumulated on a coffee card, if they had only one option for moving towards a freebie they would be much more likely to complete the cards than those with several options, like different beverage options they could purchase to get a free item.
The suite of research in this area suggests that the more options in front of you, the more chances a call to action will be disrupted by overwhelming choice.
This has big potential implications for driving customer engagement, Stanford Business suggests, because while organisations tend to consider offering clients a lot of choice as an automatic value-add, this can actually put the breaks on a decision being made at all.
This is particularly true if a customer has already hit milestones or achievements along the way.
“Companies running loyalty programs give members sitting on thousands of points many ways to keep earning more. The risk is not that they will never turn in their points, but that they will stop purchasing from the company altogether because their motivation to earn more points in the program is weakened,” Stanford Business reports.
Never miss a story: sign up to SmartCompany’s free daily newsletter and find our best stories on Twitter, Facebook, LinkedIn and Instagram.
Comments