Key Points

• Giving people too many choices tends to lessen their satisfaction.

• “Maximizers” are people who, given a choice, will exhaustively search all the options, seeking all possible information, in order to make the best possible choice. This behavior generally consumes a lot of time, and often leads to nagging doubts, perhaps where no one clear winner emerged.

• “Satisficers” are those who settle for a choice that is “good enough” for them These people are generally happier with their choice, and spend less time choosing, leaving them free to enjoy other things.

Summary

Barry Schwartz aptly demonstrates that having too many things to choose from often leads to the consumer feeling bewildered when facing the choice, and less satisfied even after taking a decision. He cites studies that indicate people are less likely to buy a product when faced with too many choices.

One of the more important examples cited is that of 401k plans. The more fund choices offered by employers offering matching 401k plans, the fewer people actually selected any fund at all, even though that meant foregoing ‘free’ money.

If you know exactly what you want - you know prior to searching precisely what characteristics you want - then more choices are likely to be better, because you are more likely to find something that most closely matches what you desire. It is, however, unlikely that most people search for products that way.

Beyond choice paralysis caused by too many choices, an abundance of choice is also likely to produce worse decisions because people attempt to simplify the choice to a point where the simplification impedes their ability to make a good choice.

His conclusions are that people should aim to be satisficers, rather than maximizers, and that by having standards to live by, rather, than, say, rigidly enforced rules from some higher authority, we can eliminate some choice in our lives that isn’t really needed.

Links

Barry Schwartz

Video with Barry Schwartz giving a talk at Google: http://video.google.com/videoplay?docid=6127548813950043200

PDF article covering most of the key points in The Paradox of Choice: http://www.swarthmore.edu/SocSci/bschwar1/Sci.Amer.pdf