Paralysis by Analysis of Choice

You would think that freedom and choice are important in maximizing sales and customer satisfaction, but experiments show that too many options can cause mental confusion, and result in no choice.33 In a now-classic experiment conducted by Sheena Iyengar of Columbia University and Mark Lepper of Stanford, some shoppers were presented with the option of sampling 6 varieties of jam, others with 24.34 You might suppose that more varieties would increase the likelihood of a match between consumer and topping, thus increasing sales in the high-option case. However, while 30% of the prospects exposed to a smaller assortment bought jams, only 3% of those exposed to the larger collection did so. In effect, their brains were paralyzed by too many choices.

Moreover, an assessment of the happiness that we believe we will have due to being able to choose and enjoy variety turns out, in retrospect, to be illusory. Daniel Gilbert, a professor of psychology at Harvard University, has claimed that we make “a systematic set of errors when we try to imagine ‘what it would feel like if’” and presented experimental evidence that variety over time is less pleasurable than a recurring favorite choice.35

The impact for cloud service providers is that a proliferation of options can actually delay and reduce purchasing. Small, medium, large, or extra-large instance? Windows or Linux? On-demand or reserved instance? Although such choices appear to provide the customer greater ...

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