Blue or red? Or would you prefer pink, green, white or maybe even black? Decisions become infinitely harder to make when you have more options, especially if the differences between them are less distinct and depend entirely on personal preference.
A study conducted by Sheena Lyengar, a renowned expert on choice, illustrates the critical differences between attracting potential customers to your storefront and the number of purchases made. In the experiment, 2 booths with jam samples were set up within a grocery store. One booth offered 24 jam options and the other only offered 6. 60% of people stopped by the booth with more options but only 3% of those people ended up buying the product. On the other hand, of the 40% of people that stopped by the booth with 6 different options, 30% of those people ended up making a purchase.
As you can see, there are 2 opposing forces at play. People enjoy having a variety of options and the ability to customize and personalize gifts. However, having too many options available, especially if the relative difference between them is small, makes it significantly more difficult to choose between them.
So, the question remains: How do we empower our customers to decide with minimal effort? The key is knowing your customers and their values. By the time a customer lands on a gift card purchasing page, they know why they are buying a gift card for that specific brand. Leveraging that knowledge can help guide customers to choose between the variety of card designs available.
In a random sample, we compared standard gift card designs offered to occasion based gift cards. We found that brands which only offered generic gift card designs resulted in 90% of customers choosing the preselected design after looking at all the options. Brands that offered generic and an occasion based (e.g. Birthday) card designs show that customers are 3 times more likely to choose a card design that is not the pre-selected standard design. This tells us that generic gift cards only act as a baseline for customers to compare and choose against. And when there are no other options, they revert to the preselected design. However, when customers are given the option to choose from occasion based cards, they are significantly more likely to choose a design that matches their gifting reason.
User behaviours are extremely complex, even when we are dealing with something that sounds simple like choosing a gift card style. With more research, we will be able to dive deeper into purchasing trends that will allow us to further cater to our customer’s target audience. This will not only allow us to create more positive purchasing experiences for our shoppers, but will further elevate our partner’s programs and brand.