There’s a way for you to increase your online sales by 1,000%. And don’t worry, you won’t have to do anything shady or participate in any shenanigans.
When most people start selling stuff online, they often create extensive product and service lists. They think having a little something for everyone will help them get more sales.
The problem is, people think “more is better,” but in the real world, long product lists are conversion killers. And if you want to increase your sales by 1,000%, you must streamline your offerings.
To illustrate, let me share Sheena Iyengar’s famous field test.
Fewer Options, More Sales
Sheena Iyengar, a professor at Columbia University, set up a free tasting booth in Draeger’s supermarket – an up scale grocery store – on two consecutive Saturdays.
On one Saturday, 24 flavors of jam were available, and on the other, 6 were available. Now take a guess. Which display sold more jam?
Given the “more is better” mindset, you’d think the larger display sold more. But as you probably know, that’s not what happened.
When 24 jams were available, 60% of the customers stopped for a taste test and 3% of those bought some. When 6 jams were available, 40% of the customers stopped for a taste test, but 30% bought some.
Huge results. While the larger display attracted more people, the smaller display sold more jam. Ten times more. A 1000% more.
Why Does Limiting Options Increase Sales?
Buying products and services is mentally taxing. In most cases, it’s not a “black and white” answer. You need to understand the available information, evaluate if it is the right fit, compare it to competitors, and then decide whether to buy or not to buy.
When you have an exhaustive product list, your prospects will have to go through the above decision-making process for each item on the list.
That’s a ton of work!
And it also leads to what social psychologists call choice overload. To summarize, when people are confronted with several options, they often pick none of them and move on to something else.
This was evident in Sheena’s experiment. When 24 flavors of jam were available, 97% of people chose none, whereas when there were 6 available, 30% bought at least 1.
But the question remains…
How Many Options Should You Offer Online?
Fewer options means more sales in a supermarket. But how does this work online? Is there a “magic number” of options that give you maximum results?
While this varies between businesses, in my experience and research, the magic number falls between 1 and 6. Let me explain.
Online Retailers (Customers Often Browse)
If you’re an online retailer, you should aim between 4 and 6 options.
People who shop retail tend to browse, so showing off more options allows you to capture their attention without giving them choice overload.
For example, Amazon, who is known for their rigorous sales testing, shows up to a maximum of 6 books in their “customers who bought this also bought section.”
Note, actual number depends on the width of your browser.
While I don’t have specific sales results, it’s safe to assume this works. Customers who buy jam are similar to those who buy books. They browse before they purchase. And considering it’s Amazon, I’m sure they tested it.
Software as a Service Providers (Customers Need Service)
If you’re selling software as a service, as in, you require a monthly fee in exchange for using your software, the magic number seems to fall between 4 and 5.
In general, when people need service, they don’t want more or less then they need. On one hand, you need to satisfy your light users, and on the other, you want to satisfy your heavy users. But in both cases, you don’t want either group to feel like they’re getting more than they need because they may cancel the service.
For example, fire up 37signals.com, which is another company that is known for its testing. They offer between 4 and 5 plans for each software service. Is it a coincidence? Probably not. Even Netflix offers between 4 and 5 levels of service.
Information Product Sellers (Customers Need Advice)
If you’re an information product seller, you should focus on one product at a time. That’s how all the big info marketers do it.
The reasoning is simple. People want to buy information from people who are experts. So, if you split up your focus, people may doubt your ability to teach them.
What if you have information in different niches? For starters, many of the top info marketers use stage names in different niches. For example, Eben Pagan uses his name in info marketing, but David DeAngelo in his dating products.
You may doubt the authenticity of this type of marketing. But the key takeaway is that you need to make sure you stand for the one thing you’re currently trying to sell. And if you’re offering various types of services, you should consider giving each of them a different home on the web.
The Bottom Line
Now I’m not telling you to eliminate products. Instead, I’m showing you how streamlining your offerings could potentially increase your sales drastically.
How do you streamline? You could create specific, specialized categories. For example, if you’re a web designer, you could offer three different options:
First, you can offer the “getting started online” package, which helps people get a domain, get hosting, and a specialized web design.
Second, you could offer “remodeling your online presence” which helps people with branding and logo design.
And Third, you could offer a “custom option” which is as per the client’s request.
What do you think? Have you had any success streamlining your products to increase your sales? Leave something in the comments.
And don’t forget.
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{ 25 comments… read them below or add one }
Nice job. I especially appreciate the specific examples.
Two thoughts.
Information marketers may do better when they offer two levels of the same product. Sean D’Souza of psychotactics.com calls this the Yes and Yes strategy. By offering people basic and premium options that are close together in price, you give them a way to choose without confusing them.
Standing for a single product is closely related to standing for a highly specific niche. The key to both, IMHO, is to know your just-right clients so well that you can quite accurately name and respond to their biggest need.
I think two similar products could work. I know when John Carlton launched his simple writing system, he had two options. The first option was expensive that included personal interaction, and the other was a “home-study course,” which didn’t have the personal time, but it was like half the price.
Great article, Derek! I love the case studies and completely agree. In my personal life I’ve found that with less, it is easier to make choices. When inundated with too many options, it’s easier to forgo whatever it is I want instead of rifling through all the factors in the decision.
I love how you put this idea into the context of different market situations. One size fits all solutions are generally not as effective (if at all) as could be.
I too have found that too many options confuses buyers and leads to lost sales. Someone once said “a confused mind doesn’t buy” and I’ve found this to be very wise advice. Sometimes we can become over zealous and actually drive our buyers away in our well intended efforts to offer a great degree of options.
I’m wondering now if anyone can think of instances wherein having a multitude of options DOES work well. Perhaps in the case of Baskjn Robbins it works because their whole marketing and brand image is designed around this idea of many options.
I still imagine though from my own experience that I’m more inclined to visit an ice cream shop whose branding showcases the high quality of their existing flavors. After all, I’m not going to eat them all today.
More thoughts on this awesome topic?
Having a multitude of options works for destinations. For example, think about a Chinese restaurant. It works there because people tend to know what they want.
I believe Baskin Robins is the same case. People go there knowing that they want to try several flavors of ice cream.
The funny thing is, Draeger’s supermarket, the upscale grocery store where the study was conducted, is known for having tons of different things (200 types of mustard for example). And even though it was known for that, less still meant more.
Interesting…
Great post, just found this blog & I’m hooked
I agree that 6 is FAR better than 24… I’d almost say 3 
I think 3 works in a lot of cases. It lets you hit the luxury, middle, and economy priced markets all at once. However, sometimes you need a little bit more customization.
Very useful information and sharing the Saturday Jam test made a lot of sense, especially when it is proven and tested without being someones opinion.
That’s the plan over here. Everything I suggest, will either have research to back it up, or real-life case studies. I don’t want any platitudes or broad generalizations here.
Interesting….this really comes home to roost for me. My husband has always sent me off to wade through the vast selections of everything on the market. Bring back (choose) 3 or 4 of the best or what I like…then we’ll decide together. As far as I was concerned I always won out because I did the selecting. However….I was under the impression this is a guy syndrome. Do you have stats on jewelry? Does this still hold true? Women seem to endlessly want more to choose from. This Mermaid would love to know if this is more gender oriented than shopper oriented.
Fair Winds and Calm Seas,
Deborah Leon
I don’t believe it’s gender related. Its related to simplicity. When you provide simple offerings, there’s less chance that your customers will be confused. And as they say, confused consumers don’t buy.
With regard to jewelry, I don’t have any specific research examples. However, I do think jewelry companies could benefit from simplifying what they offer people. Especially online.
For example, instead of barraging people with 30-40 different items to browse, you can simplify choices by making recommendations to your customers. Or, you could test how many products people often look at before a purchase. Do you know what I’m saying?
Could not agree more.
This is definitely in my top 3 that I’m always telling clients. In my world, the online shopping cart world, there seems to being a growing tendency to offer a ton of options in hopes to 1-up, or should I 10-up, the competition. Shoppers, like you mentioned, like to browse and if there’s too many choices they just browse right on by and out the virtual door.
Simplicity almost always wins in the ecommerce world.
Great post!
Interesting article
Sorry to be picky its ‘Fewer’ Articles – not Less.
Thanks. I fixed it.
Your use of the word ‘its’ should have an apostrophe as it’s being used as a conjunction and is not being used in its possessive form. I just thought I should mention that since we’re on the topic of grammar.
Interesting study. Years ago, two brothers, Dick and Maurice, made their mark in the California landscape by offering a very limited menu with high quality and quickly served food. Years later we see the results of that business model. The McDonald brothers have transformed their business into a household name throughout the entire world.
Less is more. Great analysis of this concept. I enjoyed it.
I read about that study and thought it was interesting too.
I think it also depends on how complex your offerings are. If you have different offers with just one variation between each, then you could probably get away with offering more options. For example, if you are offering jams and the only difference between one and the other is the flavor, but the price and all other variables are the same, then you could get away with offering more flavors.
But, if each option is complex in itself, then you’d want to limit your numbers. That’s one of the main reasons we decided to only present one design concept when we take on a new web design concept. I detail it more in my blog post here: http://intuitivedesigns.net/blog/post/one-concept, but basically, we figured out that when we would present more than one concept, clients would get overwhelmed and start mixing and matching and creating a “frankenstein” design.
I think this has a lot to do with how many variables are involved. From one design to another, you have a large number of variables in the first place (colors, typography, layout, elements, style treatments, etc.) and then adding a whole other choice on to that multiplies the number of choices a person feels compelled to make.
The funny thing is, the sales went up when options were limited in the jam study. So, I’m thinking that you should limit your options even if the variations are quite small. But then again, people should always test the results before they take anything as fact.
Also, Naomi, I know I owe you an e-mail response. Don’t think I ignored your quote
“So, I’m thinking that you should limit your options even if the variations are quite small.”
That’s true. I was just thinking that you might be able to get away with offering near the top amount of 6 rather than 2 or 3 or whatever. But yeah, the more you can narrow down your options all around, the better. Simplicity is a good thing.
No worries on the email response. I wasn’t worried about it at all. I know we’re all busy.
With 3,000 + messages coming in a day – our prospects are numb. Less is better, much better.
Excellent article. Here is another data point on the “right” number of ideas to put in front of clients: I understand that McKinsey, a leading strategy consulting firm (so their product is insight and advice), advocates that presentation slides have either one or three bullet points.
The interesting takeaways for me were: (1) less is more (as others have said), and (2) these very smart, experienced people say if you are making more than one point, then three points are better than two — more evidence that groupings of three seem to resonate with the human brain.
Very interesting and entertaining analysis. We all assume more is better, but I would agree with the findings. I never realized how choice overload could cause reduced sales. When there is less to chose from, you tend to get yourself invested in one of the choices and more engagement means more conversions.
Wow this is great to know as I’m one of those people who does many things, thinking I was catching every type of client possible. I shall remove some things from my list of offerings and concentrate on my best and favorite three and within those categories pare down the choices as well. I stress about how I’m going to fulfill everyone’s needs, and now the pressure is off! Time for a few of my own experiments using this research.
In my experience, people will still ask you if I you such-and-such, (wedding photography in my case, which I don’t do) because they know, like and trust you. So if that happens and you want the work, you will still likely get it from existing clients.
Thanks for the insight Derek. I’m one of those who thought more is better. I’ll have to go back to the drawing board on offering to many choices. My problem is that I want to design many products and offering 3-6 choices won’t satisfy my urge to keep designing. Do you think having multiple sites, selling similar products, keeping the product choices between three and six would be more successful than one mega site?
I have an online store with millions of products. This post made me think, may be I only need to concentrate on few items that I am using them myself, and I know they are a good products.
Thanks, Derek. Now I know that I have to sign up for your newsletter.
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