The concept of SKU proliferation is nothing new. As consumers, we've watched as stores have gotten bigger and the number of choices in any given category has multiplied exponentially. Don't even get me started on toothpaste.
At first glance, it would appear that the more options a consumer has, the better. Today's consumer is more adventurous about trying unfamiliar new flavors and exotic cuisines than ever before. And CPG companies and retailers have taken note, expanding categories with line extensions and seemingly limitless varieties.
In the "The Paradox of Choice," psychologist Barry Schwartz found that too many options were a source of consumer anxiety and that, in fact, eliminating choices lessened the anxiety. His excellent work goes on to examine how consumers go about making choices and how successful choices lead to a feeling of overall satisfaction and happiness.
Schwartz's work was published in 2004, yet ten years later, consumers still struggle with an overwhelming number of options in many categories when shopping grocery stores. Think about how that activity becomes that much more daunting when they enter the world of online shopping, where the shelf space is infinite.
In "The Visual Presence Heuristic," published in Journal of Consumer Research, authors Barbara Khan, Wharton marketing professor, and Claudia Townsend, marketing professor, University of Miami, found that even an overload of images on an online shopping site can hinder the decision-making process.
"If the assortment of product images gets too large, people might just scan all of them really quickly. They look too fast at it, and they just can't take in all the variety," says Kahn. "If there's too much variety and the choices feel overwhelming, people delay their purchase."
And that is arguably the last thing a retailer wants to see happen.