Friday, October 10, 2014 | 12:30pm - 2:00pm | Room 237, HSBC Business School Building

Abstract

A large body of research has attempted to demonstrate that people can suffer from “choice overload” (CO) from too many choices. However, replications have yielded mixed results. A 2010 meta-study found that the overall mean effect size of CO was zero, and that furthermore, no sufficient condition for CO has been identified, though there is little question that lack of familiarity is a necessary condition. We hypothesized that CO was driven by uninformed consumers’ beliefs about the risk of getting negative surplus from sampling an ex-post undesired product, based upon ex-ante product category stereotypes. To test our hypothesis, we first surveyed consumers for their “likes”, “neutral”, “dislikes” and “not tried” varieties for 24 brands (about 200 varieties) of products at a large supermarket in order to construct a measure sampling risk. We then secretly observed consumers after we switched between high and low variety displays. Consistent with the meta study, the mean effect size was zero. Consistent with our original hypothesis, CO increased with our measures of sampling risk. To our knowledge, this is the first large scale field experiment on CO.