Choices, choices.

March 21, 2009

I’m continuing to work my way through the Marketing and Psychology issue on assortment variety and choice. Today I’m reading Reutskaja and Hogarth*, who discuss the various costs and benefits that come into play in making a choice, and how the size of a choice set can affect how these costs and benefits are calculated.  Their experiment actually concerns something directly relevant to me (a rarity in this literature, I’m finding): shape and color.

They do an excellent job of presenting the fundamental issues. I’ve been going around in circles with “a big product assortment is good because….but on the other hand it’s bad because….AAGH!”. Lather, rinse, repeat.  Well, yes. In fact, it’s all true: these are the benefits and the costs. The benefits include economic benefits (finding the best value for the price), increased satisfaction, feeling positively about the situation/product/brand, feelings of control and autonomy.  Costs include cognitive effort, time spent, anxiety, and regret after purchase as you worry that you didn’t select the best choice.  The authors point out that, alas, the advantages and disadvantages of added assortment do not accrue evenly: at some point, the benefits plateu and the costs increase at a greater rate.  In the graphs, it’s an inverted U-shaped curve– as the product selection increases, the benefits go up, up, up…then suddenly down, down, down.

In the experiment, they had people choose a gift box they would use to give a gift to a friend. Participants were presented with a set of gift boxes of either 5, 10, 15, or 20 different boxes. (This is nice– usually experimenters just go with either a small or large assortment). These boxes varied either in color, shape, or both (e.g., a set of red boxes in 10 different shapes; a set of square boxes in 10 different colors, a set of 10 boxes of different colors and different shapes).  They then rated their levels of satisfaction with the process of making the choice, and with the outcome– how satisfied they were with the box they ended up choosing. Turns out, when it comes to shape vs color, there’s a big difference in how people respond to variety.  The responses to shape clearly showed that inverted-U curve– a rapid increase in satisfaction peaking at 10 options, followed by a  decrease once they hit 15 options.  For color, the satisfaction levels increased markedly between the 5 and 10 option levels, but didn’t decrease with15 or 20 options.  It just plateaued.  In other words, if you’re thinking about adding options to a product line, adding too many new shapes can really count against you, while adding more color options will help to a certain point and then above and beyond that, won’t do any good (or harm) with respect to satisfaction.

Of course, this doesn’t give us much insight into the too-much-choice problem, since in this study participants had to choose, and the measurement was of satisfaction; in the too-much-choice scenario, what’s measured is whether a choice is made at all.  And although the satisfaction levels drop off or plateu with added choice, what we don’t know is, for example, how brand perception is affected. Perhaps added color variety doesn’t continue to enhance satisfaction beyond a certain point, but it may continue to enhance brand perception (especially if the brand in question is an artist, as opposed to a toaster, but that’s another empirical question). 

 

*Reutskaja and Hogarth. 2009. “Satisfaction in choice as a function of the number of alternatives: when ‘goods satiate'”. Psychology and Marketing 26(3): 197-203.

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Too much choice? Nah.

March 17, 2009

The March issue of Psychology & Marketing was a theme issue on assortment variety and choice. Lots of good stuff therein– I hope to slog through it in short order.

First up is an article trying to identify boundary conditions on the too-much-choice effect– the much-ballyhooed (well, somewhat-ballyhooed) finding that too much variety will lead people to freeze up, say to hell with it, and leave without purchasing anything– a refusal to make a choice.  Researchers are still picking at this problem– when, why, how, for whom does an increase in the available choices cause decision overload?  Just how much choice is too much, anyway?  5 choices, 20 choices, 50 choices…? Where’s the line?

Gearing up for the art show season as I am, these questions have been on my mind as I try to figure how much to make in preparation, and how much to display when the time comes.

Good news (sort of) from the first article from the volume that I read*:  There are just no clear answers. They did three experiments in two countries, looked a a whole bunch of variables, and found that none of them correlated very reliably with a too-much-choice effect as lower reported satisfaction with the assortment.  Much of the time, the effect was not even in evidence, even when the choice set was rather large (79 items). Even if people reported that they found the decision difficult, it didn’t mean that they necessarily experienced choice overload.  Now, this is annoying if you really want to make sure you aren’t causing it in your own product display– but it’s also kinda nice to know that this effect isn’t all that robust, and in any case no one knows yet what causes it, much less how to prevent it.  One less thing to worry about for now.  In general, the benefits of offering a large variety (increased satisfaction with the variety; increased consumption of items from a large assortment) are more clear than any negative effects.

 

* Scheibehenne, Greifeneder, Todd. “What moderates too much choice?” Psychology & Marketing 26:3: 229-253.

Ok, enough with the chicken feet already. Back to work.

I keep coming back to this product line variety question. It’s important to me because people’s opinion of how much variety I offer and of what sort can form very quickly, and whatever judgment they come to in that first crucial moment or two can color their perceptions from that moment on. If they decide I offer a good variety and am a master of my craft, they’re more likely to browse and then buy. If they decide my variety isn’t so good and that I don’t look focused enough, nothing will change their minds.  I make the art I make, sure, but if small details of presentation can make the difference in how people see my work, well, I want control over that. And as much as art is different than any other product, still, as an artist you can make what you make, but the moment you try to sell it, it’s a product and you’re working in an economic world. Best come prepared.

Anyway, yeah, variety. Earlier research I looked at indicated that a) being very focused in your product offerings leads people to believe that you are better at doing what you do, and therefore, your product is better, and therefore, they’ll be willing to pay more for it; and b) the variety has to be within-category, other wise you don’t look like an expert. This led me to wonder a bit about, in the arts, what counts as operating within one category.  And how much leeway do we have?

So now a little more on categorization.  Categories can be broad or very fine-grained, and a couple of things contribute to this.  One thing is expertise– if  a person is very familiar with the overall category, they’ll be able to chop the domain into smaller pieces.  So if you’re not into, say, fine tea, tea is tea is tea. But if you’re a tea expert, you break it down much more– you’ve got your black, green, yellow, white, oolong, pu-erh, pouchongs and souchongs…and then your growing regions, tea estates, and leaf size. 

Apparently* another way that finer-grained categorization can happen is just through preference– and not just because preference often leads eventually to expertise.  In this study, the researchers showed people unfamiliar symbols, and showed the symbols with either positive or negative photos.  Then they had them sort the symbols into categories (according to ‘meaning’). The symbols that had been shown with positive images ended up in more categories than symbols shown with negative images.  This suggests that just liking things allows you to find more distinctions among them.

I take this to mean that some things about presentation of art are going to be self-fulfilling– people who don’t know anything about your work, materials, or technique and who decide from the get-go that they don’t care for your style– you’re just not going to be able to win themover.  They won’t see the variety you actually have, and thus they’ll be less likely to see your craftsmanship, product quality, and be less impressed with your selection. Don’t worry about them.

On the other hand, those who take to your work immediately will stay and look, all the while thinking and seeing more and more detail and gettinghappier and happier.  For them, you don’t want to bee TOO focused–catch their eye with a nice variety of items with small differences so that the more they look, the more variety they’ll perceive, and that will cycle back into them liking the work more. 

And I’d guess that how widely you want to draw your categories to begin with depends on who your customer is. If they’re folks who already know a lot about art, you’ll want your offering to be more focused. But if they’re new to your work or only occasional consumers of your type of product, you can perhaps be a little freer to offer different types of things (within limits).  Think about a glass jewelry maker like Kevin O’Grady who sells mainly to collectors, and offers mainly bracelets, vs. a glassworker who sells to the public at art fairs and offers pendants, necklaces, bracelets, earrings, cufflinks, hair barettes, brooches, etc. etc. 

 

*Smallman, R. and N. Roese. 2008. Preference invites categorization. Psychological Science 19:12, 1228-1232.

In that last posting on assortment variety and quality inferences, we saw that product variety within one product category counted for a lot more in terms of perceptions of quality and expertise than product variety that spanned several types of items. That led me to wonder about what the relevant category distinctions in the arts really are–medium, style, function?

This article*, while not dealing with the arts specifically, shed some additional light on the subject for me.  They were looking at how different kinds of product organizations on a shelf or in an online store affected perceptions of variety.  Two main patterns fell out of this: there was a difference between shoppers who used the item on a frequent basis and those who seldom to never used the product. When the product layout matched the shopper’s internal organization– the existing schema that frequent product users already had in their minds– they judged there to be a better product variety than layouts with a bad mismatch between internal schema and product layout. There was no real effect for shoppers with no experience with the product, though.

Another type of organization is by shopping goal — people who aren’t very familiar with the product category tend to rely on this when searching for an item.  Now, the researchers found that when the product layout matched shopping goals, people were able to find what they wanted to buy more quickly, but also perceived less variety.  And, interestingly enough, if the shop filtered out (by a search function, for example) items not matching the shopping goal, the customers were much less satisfied with the product variety– even though they managed to find exactly what they wanted!

Ok, back to the issue of categories of art. The most useful information I got out of this was that there really is more than one way of categorizing  things– there may be an existing schema for some experienced shoppers like art show regulars, gallery buyers, collectors, other artists.  But for many, many casual browsers, the categorization may be directed by shopping goal.  They’re looking for a gift for their niece, a housewarming gift for a friend, whatever. They don’t necessarily have any concept of Fiberart, Paper arts, or whatever.   Mixing items of various functions even within one medium may seem to these folks more like a hodgepodge than a display of artistic prowess.

 I’m really just thinking as I type, here– even the most inexperienced arts buyer probably has some sort of internal schema for art, even if it’s just based on useful vs. for display only, or what is it made of?  I’m really no closer to understanding how the average person thinks about these things or whether artists have any more leeway than other types of businesses.  I guess I’m just trying to talk myself out of the conclusion that I should separate my 2D work from my jewelry!  What do you think– same body of work, or oddly incongruent?

 

 * Morales, Kahn, McAlister, and Broniarczyk. 2005. Perceptions of assortment variety: The effects of congruency between consumers’ internal and retailers’ external organization. Journal of Retailing 81: 2, 159-169.

More on product variety

January 23, 2009

Recently I wrote about a study suggesting that product specialization gives rise to quality inferences– the more narrow a set of products you offer, the higher quality the products are assumed to be.  Today I came across an experimental study* related to this idea that supported it pretty well and added some other interesting tidbits.

The researchers looked at it from the point of view of variety– variety is generally acknowledged to be a good thing, because people tend to more satisfied with their purchase when they feel like they’ve had a large variety to choose from. And having a large variety just increases the likelihood that they’ll see something they like in the first place. On the other hand, too much variety can stress people out and cause them to abandon the whole purchase.  Both of these effects are pretty well documented, and appear to contradict each other.  Hmmm.

Berger et al suggest (with the help of some nicely designed experiments) that if you have two brands, one of which has a large variety of their product and one a smaller variety, people will prefer to buy from the brand with the more variety, even when there’s an overlap in some of the product offerings.   For example, you’re ice cream shopping, and you’re choosing between one brand with 12 kinds of ice cream and another brand with 5– even if you just decide to go with vanilla (offered by both brands), you’re more likely to buy it from the brand offering the greater range of flavors.  They trace this back to a quality inference– people assume that the brand with more variety is of higher quality.   This in turn is connected to the association of depth of variety with category expertise– how many widgets of that kind you make is taken to indicate mastery of that category. This only works if the items you offer are compatible– if you do several different kinds of things (large product breadth), it looks like your skill in any particular domain is lacking.  So in their experiment, participants ranked for quality and expertise 3 hypothetical companes offering , respectively, 2 kinds of road bikes, the same 2 kinds of road bikes plus 5 other road bikes, and the same 2 road bikes plus 5 other bikes for other uses (mountain, beach cruiser, etc).  Both perrceptions of expertise and quality were greater only for the company with the high variety of items in the same category– the company offering 7 different types of road bikes.

*whew*

Ok, obviously this supports the argument that specialization is good– don’t mix up your categories, even if you are a multi-skilled creative genius.  Keep making to your heart’s content, but don’t put it all under one brand umbrella– open that second shop with a different name to focus on another medium if you feel you really want to sell more than one type of item.

But (suggest the researchers) if you have an item from your main category that is a little odd or costly, it may be worth it to you to go ahead and offer it anyway– even if no one ever actually buys it.  It can still do the work of increasing your variety and helping people understand that you are an expert at what you do.

I also see this as yet another reason for artists who wholesale to set minimum purchase requirements.  Or if you consign, to insist that they take a certain number to make a good selection available.  If a store takes only a small selection, what they’re doing may not necessarily hurt them, since it’s adding to the overall variety of their store, but your work is much less likely to move. If they only take 5 pairs of earrings to ‘try them out’, the artist the next display over with 20 pairs out is going to outsell you, even if yours are similar (or just plain better :).  People will  assume them to be the more skilled artisan.

All of this depends on what people take to be the relevant categories. And it’s not entirely clear for artists, I think– after all, if I saw a potter who made nothing but vases, would I think, wow, this person clearly is the Vasemeister? Best potter ever? Not necessarily.  There’s something about being able to do many (or at least a few) things in your medium to demonstrate skill.  This is just a guess, but I think function is the key, rather than medium. I find this surprisingly difficult to accept as an artist– there are so many things I can do in my medium! Isn’t that what counts? I’m guessing not so much to regular people–how do people search? In stores, it’s by function, rather than material or shape. You have kitchen stores, not Metal Things stores or stores where they sell Square Things.

 Still, I have a hunch that the arts are different somehow. After all, witness the career of Brother Mel, who does a new thing every year. I mean a totally new thing. One year it’s landscapes, the next year it’s Deco-style lawn furniture, then next time round, things made of recycled silverware.  And so on. His brand is category variation. No category overlap whatsoever, and collectors love it. Somehow the myth of The Artist gives us some latitude that regular businesses don’t have. But how much?

 

*Berger, Draganska, Simonson. 2007. The influence of product variety on brand perception and choice. Marketing Science 26:4, 460-472.

One question I keep coming back to is whether to expand my product line– I primarily make jewelry, but as a calligrapher/ paper artist more generally, I have a number of other things in my skill set– I can also do 2D calligraphy (prints, originals, greeting cards, stationery), magnets, bookbinding, decoupage, and so on.  But is it a good idea? Increasing my product line does give a greater variety, and a greater chance that my customers will find something they can’t live without.  But would it seem too unfocused?  Will they take me to be a jack-of-all-trades, master of none?

An article that may be relevant to this is “Signaling Quality Through Specialization”*. Now, the authors were primarily modeling the effects of specialization in service firms– services being different from products in some important ways (generally perceived as higher risk, with a greater amount of effort involved in increasing their product range). But they do admit to their analysis some products requiring high skill levels — handcrafted products are specifically mentioned.

They argue that specialization– that is, the choice to offer only one type of product– can be a very useful signal to the consumer that the product is of higher quality. This is most true when price isn’t being used to indicate quality. Price is always a signal of quality– it’s been shown pretty reliably that, all other things being equal, high price translates to a perception of high quality, which the added bonus of specialization then enhances. But let’s say you don’t want to go the higher priced route– or can’t.  That’s when specialization can step in and really help separate you from competitors.

The only scenario they mention in which specialization is not a useful signalling tool is when the very size of the business itself both signals quality and allows for serious economy of scope– think American Express. That doesn’t apply to most artist/crafters– by definition, I’d say.  

The upshot of all this is that it’s probably to your benefit to remain pretty specific in your offerings. Selling jewelry, knitted hats, watercolors, and recycled bottlecap sculptures all under the umbrella of one business/ brand would be a bad way to go. 

Incidentally, this also helps me understand why it’s so important to have a very focused set of jury slides when applying to high-end art shows.  Showing your mastery of a very specific skill set in your 3-4 slides translates directly into how good at your craft the jury will then believe you to be. In a highly competitive environment like that, the more specialized, the better.

* A. Kalra, S. Li. 2008. Signaling Quality Through Specialization. Marketing Science 27:2, 168-184.

Mere Categorization

December 11, 2008

Here’s an interesting one: apparently there’s some evidence that just putting things into more categories makes shoppers happier, even if you don’t actually change the numbers of things on offer. They* call it the “Mere Categorization Effect”.  So yes, you don’t have to actually increase the variety of options in order to make people feel like they have a good choice and afterward feel good about their own choice– all you have to do is divide things up and give them a label. If the category happens to be informative and useful, so much the better.  But it doesn’t need to be in order for there to be an effect. 

The researchers think it’s a perceptual cue that helps people identify differences among things. Too much variety all mushed up can make it hard on people (especially those who aren’t already familiar with the choices) to see the differences between similar things, which makes them not feel as in control of their choice. That’s a big turn-off, and sometimes leads to the result that they feel overwhelmed, give up, and leave without purchasing– but a shopper who feels fully informed and in control of the implications of their decision is a happy shopper.  And the simple act of dividing things up a little more can make them feel that way.

 This seems easy enough to implement by artists and crafters, whether the display is bins of prints, trays of pendants, a table filled with scarves or vases. For me, as I mentioned, I use frames to display my work. Some of them can hold a large number of items– in particular, my earring display usually holds over 80 pairs.  I thought that the more I had out, the easier it would be for someone to find the right pair for them.  But it sounds like I’d do better dividing that one display into several smaller displays–  if I do it right, it might seem like I have more variety even if I don’t actually have as many pairs out.  Nifty!

 

*Mogilner, Rudnick, and Iyengar. 2008. “The Mere Categorization Effect: How the presence of categories increases chooser’s perception of assortment variety and outcome satisfaction”. Journal of Consumer Research 35: August. 202-215.