Are You Offering Customers Too Many Choices?



overwhelmed cusomers

Could your retail store be more profitable by offering customers less? Recently, The Washington Post spotlighted a growing trend of restaurants cutting back the number of items on their menus. From fast-food to casual dining to more upscale venues, since 2008 the number of options offered on restaurant menus have declined.

What does this have to do with retail, you ask?

While the Post posits many explanations for eateries’ editing their food choices, including the rise of foodie culture and the need to cut costs, I think it also has a lot to do with customers being overwhelmed. With information overload coming at us all day, everywhere from our phones to our FitBits to our smartwatches, who wants to deal with yet more information on a 48-page Cheesecake Factory menu?

The same principle applies to retailing. While big retail chains and discount mass marketers can stock their shelves with everything under the sun, doing so is prohibitive for smaller stores. So why not go the opposite direction and pare down?

Offering a curated collection of fewer items has several advantages for a retailer:

  • It simplifies inventory management.
  • With fewer items to stock, dust, display and clean around, it makes your store easier to merchandise and maintain.
  • It appeals to both kinds of customers—the ones who want to run in, find what they want and run out, and the ones who luxuriate in shopping as a relaxing escape from the day-to-day grind.

If you want to take a cue from restaurants and pare down your “menu” of choices, here are some steps to take:



Assess Your Products

Take a close look at which products are your bestsellers, and which are your most profitable items. Maintain a balance as you cut back. If your store stocks only popular, low-margin items, you won’t make a profit, but if you sell only higher-priced products you won’t make as many sales.

Assess Your Customers

Is there a particular demographic that accounts for most of your sales—and profits? For example, suppose you sell trendy women’s clothing and originally expected most of your customers to be college girls or young women. But assessing your demographics, you see the people spending the most are 40-somethings Gen X’ers looking for hip clothes. Consider realigning your product mix to focus on clothes these women crave—which can be higher-priced, higher-margin items than thoseyounger women can afford.

Hone Your Brand

Most likely, your business will need a rebranding to go with your new approach. Update your marketing materials and marketing and advertising campaigns to reflect your new look and new target market.

Get the Look

Make an impression by streamlining your store to show off your carefully curated merchandise. Cut back on display racks, shelves and clutter. Simplify your color palette and décor; match it to your target market (for instance, the clothing boutique could use more sophisticated, upscale colors and materials to appeal to older women.) Don’t forget to change store signage and window displays if necessary.

Small Steps, or Big Bang?

Depending on how muchmerchandise you plan to eliminate from your store, you may want to make the shift gradually or all at once. If you need to get rid of lots of stock that won’t fit your new image, try reducing what you display bit by bit, putting the outdated product on sale. This gradual change also allows you to let customers know what’s coming so they won’t be surprised.

On the other hand, if the stock of merchandise you plan to eliminate is already pretty low, maybe you feel comfortable selling it quickly (or even at a loss) and making the big change right away. Closing your store for a week or weekend to update to the new look, then holding a “Grand Re-Opening” to celebrate, can really make a splash.

If you take the “all at once” approach, it’s crucial to plan your marketing strategy well. Reach out to the customers you now plan to target (for example, send the the Gen X women personalized emails with offers for a free glass of champagne when they shop on your grand opening day). Let local media know about your grand re-opening and your new focus, too.

Keep laser-focused on your “less is more” concept, and you’ll soon find that less really can equal more (profits, that is).

Customer Photo via Shutterstock

4 Comments ▼

Rieva Lesonsky


Rieva Lesonsky Rieva Lesonsky is a Columnist for Small Business Trends covering employment, retail trends and women in business. She is CEO of GrowBiz Media, a media company that helps entrepreneurs start and grow their businesses. Follow her on Google+ and visit her blog, SmallBizDaily, to get the scoop on business trends and free TrendCast reports.

4 Reactions

  1. I’m so glad you mentioned Cheesecake Factory. Their menu is gargantuan! But you’re totally right. People are quite good at determining the better of two options, but make it 3 or more and mentally they go haywire. K.I.S.S.

  2. Aira Bongco

    It’s a mistake to provide customers with too many choices. It can prevent them from making a choice altogether. The key is to keep the choices build on top of each other so that your customer can choose to get all of them.

  3. I rarely use Starbucks, but when I do, it takes me a while to choose something for the very reason you mentioned. Many choices – decisions, decisions – plus what size do I fancy?

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