The Next Frontier for Merchandisers: Taming Consumers’Decision Fatigue

In a consumer economy where affinity groups are increasingly discrete and harder to target efficiently, and machine learning is tapping into the power of each shopper’s data, the retail industry faces a growing challenge that threatens to trump all the others. As technology becomes ever more sophisticated, consumers are increasingly experiencing a phenomenon unique to the modern age: decision fatigue.

Decision fatigue happens when you log on to your favorite streaming service looking for something to watch and, after a half hour of sampling a few dozen trailers, realize you’ve squandered the time you set aside for entertainment and move on to another task. Thousands of possibilities, but nothing to watch?

Decision fatigue happens when an Amazon
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customer shopping for a belt becomes overwhelmed with hundreds of choices and zillions of reviews and decides to go to a store that offers a rack of belts they can touch and evaluate. Or when you find yourself in the window treatment aisle at a home improvement store and there’s no one to help, so you shrug and leave.

The number of decisions we can make in a day has boomed. By some accounts, the average American supermarket in 1976 carried 9,000 different products. That number has been estimated recently to have grown to 40,000. One single brand of toothpaste offers a dozen different variations. It’s exhausting for consumers and, for retailers, a hidden loss of sales in stores and abandoned shopping carts online.

The paradox of choice isn’t a new concept. Academic research published in 2000 by Columbia University and Stanford University researchers sought to test the assumption that the “human ability to manage, and the desire for, choice is infinite.” The result: people with more choices were often less willing to decide to buy anything at all. Their subsequent satisfaction with their choices was lower when confronted with 24 or 30 options than when they faced only six.

A fellow Forbes columnist, Will Conaway, wrote a column in 2020 about the price we are paying, and going to pay, for the seemingly unlimited choices of the frictionless life. Conaway is a corporate-level consultant to major healthcare organizations and a lecturer at Cornell University.

He suggests that checking for new messages, posts, and updates hundreds of times a day is toxic and cites research that disproves the notion that we are good multitaskers. Conaway observed in his column, “There’s a universally growing pressure that what is important now will not be important in 10 minutes. There’s an expectation to solve problems at the same speed as clicking through websites.”

Some of the most disturbing findings in the field have been those studies that focus on the criminal justice system. We want to believe that judges rule based exclusively on facts and law. But a 2011 research study edited by the noted social scientist Daniel Kahneman determined that, for instance, judges were significantly more likely to grant parole sentences in the morning than afternoon. Morning cases were released 70 percent of the time, while those in the late afternoon saw a release rate of less than 10 percent.

Another study that examined the forecasts of stock market analysts found that their accuracy declined as the day wore on. All of this suggests you might want to schedule your doctor visits for the morning.

Artificial intelligence may help e-tailers edit the number of products they offer a browsing shopper while searching online. Still, in the world of bricks and mortar, the selection of merchandise, styles, sizes, etc., will require the kind of information few retailers and brands are investing in today. HINT: The answer is right in front of you every day.