You are probably thinking that increasing sales by 600% sounds really fishy. Let me assure you that there is a way to increase your online sales by 600% without doing anything illegal or involving yourself in complex code.
We are often told that choice is important in that the more choice we have the more options it gives us and the better chance we have of meeting people’s needs. This is also the case with selling online. People often have extensive lists of products and services on their websites in the belief it will give them more sales.
However more isn’t necessarily better and can kill conversions.
Let’s start by taking a look at a field study.
Sheena Iyengar, a professor of business at Columbia University and her researchers conducted an experiment in a gourmet market. They set up a booth and every few hours they switched from offering a selection of 24 jams to a selection of 6 jams.
Now take a guess at which selection sold the most jams?
Most of us would probably say that the selection with more jams sold more.
But here is the interesting part. While 60% of people visited the larger selection of jams only 40% stopped by the smaller selection. However 30% of people who sampled (taste test) the smaller selection made a purchase whereas only 3% of those given the choice of the larger selection actually bought a jam.
So the smaller selection actually sold more jam. In fact 6 times more jam and increased sales by 600%.
Consider this – Walmart typically offers around 100,000 products in its stores, but the world’s ninth biggest retailer Aldi, has only 1400 products in its stores.
It is also important to understand that not everyone sees choice the same way. Sheena Iyengar talks about running interviews in Russia as the country began transitioning to a capitalistic society. In interviews she offered participants 7 drinks including coke, sprite, diet coke and other sodas.
When the participants were asked how many choices they were given they responded by saying they were being given one choice – soda. When juice and water were added to the selection, participants said they now had 3 choices.
So choice can differ from culture to culture. Americans for example are trained from an early age to spot the difference. For an American who are exposed constantly to more varieties and options, choice is about who they are and the product itself.
The reality is that as human beings we have physical, emotional and mental limitations that limit us from being able to process every single choice we face. The value of choice depends on our ability to see differences between the options.
When someone can’t see the difference between the options or there are too many choices to compare and contrast, the process of choosing can be frustrating and confusing.
So how does this apply to increasing sales online?
How do you make it easier for your audience to choose?
How many choices should you offer in order to increase online sales?
The answer really depends on the culture of your audience in that different people from different cultural backgrounds or nationalities could perceive choice differently. It would also depend on the industry.
Let me explain by looking at a few industries:
SAAS (Software as a Service)
Software as a Service generally works by people subscribing to a monthly or yearly fee. People often make choices based on their usage of their service. Companies in turn try to offer an option for light users and provide an option for heavy users as well.
Wistia for example has as many as 6 options. Visual Website Optimzer offers 3 paid options as well as a free option. 37 signals, a company that engages in sales testing, has a few products each of which has between 3-6 options.
With online retail most visitors tend to browse so offering more options will increase the chances of your website visitors staying on the site without being overwhelmed.
Amazon who is also known for their online sales testing shows a maximum of 6 books in their “customers who bought this also” section. However Target only shows a maximum of 4 products in their “guests who viewed this item also viewed” section.
Membership or Information Products
If you sell memberships to a course or series of webinars or information product then you really need to focus on just the one topic or product.
See, people want to buy information or knowledge from experts and in turn become better in a particular area. So focusing on just the one topic or niche lends greater credibility. In the instance that you are in different niches, you want to use different stage names like successful internet marketers do. Eben Pagan uses his real name for productivity and internet marketing related niches but uses the name David DeAngelo for his dating products.
Also note that Eben Pagan does not include all his products on the one site. Each has its own website and speaks to a different audience.
So how do we make it easier for customers to choose in your business?
Professor Iyengar offers 3 more techniques.
1. Concretize or make real
A study was done at ING. Employees were in a session for enrolment for their 401(k) plan and the session was conducted the same way it had been done before except for one change. People were asked to think about all the positive things that would happen in their lives if they saved more. The result an increase in enrolment by 20% and an increase by 4% of the amount of people willing to save.
In another study conducted in Wegmans grocery stores the magazine sections were reorganized to provide to options. One option included 600 magazines in 10 categories and the other option included 400 magazines in 20 categories. People felt that they had more choice and a better choosing experience with 400 magazines in 20 categories. So people can handle more categories than they can handle choices. Categories help people tell products apart.
3. Condition for Complexity
People can handle more information than we think we can as long we the complexity is increased gradually.
So How Does This work for you?
The key is to be choosy about choosing in order to create a better experience for your customers. That’s right, be choosy about choosing.
This does not mean that you need to remove products from your range but rather streamline how they are presented as choices.
A studio or portrait photographer for instance could use the 4 techniques to offer 3 options categorized for different purposes:
First a casual portrait shoot for families, individuals, even couples and or kids
Second a professional or glamour shoot – to help people build a professional image for their business collateral, online presence or career.
Third a custom option which is as per clients request and include outdoor location shoots.
With each option the photographer could include content such as testimonials and past photographs and questions to get people to think about positive memories or outcomes of their choice.
Once a choice is made the photographer can then walk the client through simple choices as such as do the photos need to be in black and white or color, through to increasingly complex choices like the colors of clothes, styles, purposes and resolutions of photos etc.
So let me know what you think in the comments below. What has your experience been with streamlining your offers or products to increase sales?
And by the way,
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photo credit: Benson Kua