Sep 24, 2021
you have a lot of options for what to listen to, and I’m glad you
chose The Brainy Business. Especially because (as you’ll hear about
on today’s episode), due to the paradox of choice, having too many
options and decisions can leave people paralyzed instead of
empowered. That paralysis can make it so people don’t make any
decision at all, so you stick with the status quo of scrolling
Instagram or playing a game on your phone. With over 2 million
podcasts out there to compete with (plus all the YouTube channels,
Netflix, and other streaming services, music options like Spotify
and Pandora), plus games and email, and...well you get the
idea...There are a lot of options out there that could have made
tuning in a very complicated choice.
today’s episode, I will tell you all about the paradox of choice:
what it is, and why it matters for you in life and in business
(including some tips for creating and presenting options to your
current and potential customers).
- [00:06] Today’s behavioral
economics foundations episode is about the paradox of
- [03:02] As I mentioned in the
introduction, the paradox of choice is a term and concept
popularized by Barry Schwartz, whose book and popular TED talk have
been shared around the world.
- [04:42] When presented with too
many choices (like we have in most societies today) people become
paralyzed, stressed, and feel stuck. It can cause mental anguish
and regret. Some choices are good, but too much and we are
definitely worse off.
- [05:24] The really important
thing to know is that adding some choice is important. Because we
humans can’t value one-off items, having at least some choice and
comparison helps us to make a decision and feel good about it, but
too many and we get overwhelmed.
- [07:15] When there are too many
choices, our brains get overloaded.
- [09:41] It is easier to stick
with what we have always done than to look for something that may
or may not be better.
- [11:42] Your subconscious is
dealing with this sort of letdown constantly. It can get very
taxing over time and it’s no wonder our brains rebel at the idea of
evaluating too many options.
- [13:14] In a world where there
is always another option, always a list of potential matches and
the feeling that (much like the pair of jeans) perfection is “just
one search away”...it can be hard to settle even when the choice is
something you would be incredibly happy with. That constant thought
of “what if” can be too much for many to bear.
- [13:53] Anticipated regret can
have a huge impact on behavior. We want to choose wisely and,
frustratingly, this pursuit of perfection (or even just a little
bit better) can cause us to make worse decisions.
- [15:02] The important thing to
know is that while it seems like lots of choice and infinite
options would make us happier (increasing our freedom and wellbeing
to use the terms from earlier) that just isn’t how it
- [17:12] A maximizer is always
looking for the best of the best. They want to make sure that they
choose whatever is objectively the best there is every single time.
That anyone else could look at and know that it is conclusively
“the best choice”.
- [17:28] Satisficers are people
who find something that is “good enough” and feel satisfied with
that choice. Once satisficers find something they are happy with,
they are good to go and don’t necessarily dwell on “what might have
been” too much. Even if there was a better option out there you
could have made, you are subjectively happy and therefore at peace
with the decision.
- [20:04] For maximizers (like my
husband), these details are vital pieces of information needed to
make a decision, and for satisficers (like me), it is just too much
to think about.
- [22:45] The first tip is
to choose when to choose. If you only save the big evaluation for the
really important stuff, it will help you have that mental capacity
when you need it and not be so stressed and overwhelmed with the
- [24:07] Don’t waste a bunch of
mental energy on decisions that don’t matter. Be happy with good
enough whenever you can, so you can have more mental energy when
you need it.
- [24:22] The next tip, which is
to become a chooser, not a
- [25:27] The next tip is
to satisfice more and maximize
less. As you just heard,
satisficers are happier, less stressed, less regretful, and so much
more. Good enough is often good enough.
- [25:58] Think
about the costs of missed opportunities. In short, you should look for the balance of
thinking of missed opportunities.
- [26:20] Next is to
make your decisions nonreversible. If you aren’t able to “what if” you are more
likely to be happier with a choice you made because you won’t dwell
- [26:31] Practice
an attitude of gratitude.
There are lots of studies that find we are happier and better off
when we appreciate what we have. Be grateful for everything you
have in your life
- [27:05] Regret
less. If you don’t think
about choices you have made after the fact and don’t allow regret
to control you, it will allow you to be happier
Anticipate adaptation. We naturally adapt to any situation – plan
accordingly to avoid constantly chasing the next high.
- [27:53] Control
expectations. When there
are too many choices, the expectations for something to be perfect
are far too high, and because nothing can really live up to that
standard, you end up with a recipe for always being disappointed
with items not meeting unrealistic expectations
- [28:21] Curtail
social comparison. What is
your happiness worth and how do things change if you add that into
your evaluation? Eliminating social comparisons can help with
- [29:11] His last tip is
to learn to embrace constraints. Limiting options and reducing possible
choices can help you to fulfill these other tips on the list.
Embrace the idea of constraints and set up some firm rules for
yourself to follow around choice. You will be surprised about how
they help your mental state.
- [30:30] NOW, my tips for
business applications (which are different than on an individual
level. First, is to know that people are generally overwhelmed with
all the decisions they are having to make every day.
- [31:00] You also want to really
consider what choice they are making and what the defaults
- [33:15] When someone asks for
your recommendation – give it, and don’t provide more than two
options. Be enthusiastic about it, explaining a little of why you
like it to prime them for excitement.
- [34:56] To summarize, you are
going to limit the options you present and show that you are the
expert (and did the heavy lifting for them) by making
recommendations and helping work with those herding instincts by
including some social proof.
- [35:25] If you implement your
social proof and relativity and structure the decision well, it can
make a decision easier without people getting so overwhelmed that
they walk out. They can feel like there are a lot of options, but
you can still nudge and guide them along the way to reduce the
number of decisions and make them easier. I’m calling this the
“illusion of choice.”
- [37:42] Consider the customer
experience – who is searching? What problem are they solving? What
is the best solution? How can you make it obvious that it is the
best choice for most people to help them decide?
- [39:17] Melina’s award-winning
first book, What Your
Customer Wants and Can’t Tell You is available on Amazon, Bookshop, Barnes &
Noble, Book Depository, and Booktopia.
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