NEW YORK — 

What is the limit for too many options?

According to Coca-Cola, there are approximately 400 varieties of beverages.

Because of this, the drink company has recently made the decision to stop producing half of them, getting rid of names such as Tab, Zico coconut water, Diet Coke Fiesty Cherry, and Odwalla juices. However, there are still approximately 200 other options available.

Many other companies are also following suit, streamlining their product range from condiments to breakfast items to automobiles, in order to prioritize their top-selling items.

Stew Leonard’s, a grocery store franchise with locations in Connecticut, New York, and New Jersey, currently offers 24 different types of cereal, a decrease from 49 in 2019. Edgewell Personal Care Co., the company behind Schick razors and Banana Boat sunscreen, has reduced the number of variations of its anti-bacterial wipes, including Wet Ones. Dollar General, headquartered in Goodlettsville, Tennessee, used to carry six types of mayonnaise but is now considering removing a few from their inventory.

According to Dollar General CEO Todd J. Vasos, consumers will not be able to distinguish between products. In fact, it may even make their shopping experience easier.

Last year, the Kohl’s store in Clifton, New Jersey had an abundance of tables filled with sweaters and shirts in various colors, along with crowded dress racks showcasing a diverse range of styles. However, there has been a shift to a more selective approach, with smaller piles of knit shirts in a limited color palette on the tables and a decrease in the number of styles offered on the dress racks.

Kohl’s, under the leadership of its new CEO Tom Kingsbury, has reduced the number of colors and styles of sweaters, jeans, and other products. They have also increased the frequency of their buyers’ visits to the New York market in order to acquire new and trendy merchandise.

Kingsbury mentioned in a call with analysts in November that in the past, they would make large purchases of goods that would not perform well and arrive 12-14 months later. However, they plan to utilize the marketplace in order to be more agile and respond to business trends faster.

A number of clients are satisfied with the alterations that have been made thus far.

Kimberly Ribeiro, 30, commented on the Kohl’s store she visited on a recent Friday, saying “It is well-organized. When things are not cluttered, it prevents feeling overwhelmed.”

In the world of automobiles, customers are noticing a decrease in available options. General Motors and Ford have been promoting their efforts to minimize the number of option combinations offered to customers in order to simplify the manufacturing and purchasing processes.

In contrast to a few years ago, there has been a shift away from an abundance of options, fueled in part by the rise of online shopping which disregarded spatial limitations. However, this approach did not always result in increased sales, prompting companies to streamline their offerings a year or two prior to the pandemic.

Amidst the pandemic, companies sped up their trimming process, prioritizing essential items as they grappled with supply chain issues. Even as the pandemic subsided and goods were able to flow more freely, many businesses continued to downsize their offerings, arguing that customers prefer a more streamlined selection. This also proved to be financially beneficial for companies, as they did not have to deal with excess inventory that would later require markdowns.

According to Circana, in 2023, approximately 2% of products in stores belonged to new categories such as beauty, footwear, technology, and toys, which is a decrease from the 5% of items that were new in 2019.

Eric O’Toole, the president of Edgewell’s division in North America, acknowledged that the pandemic was a valuable opportunity to reevaluate the company’s assortment.

We refrain from following trends, as they can increase expenses for both the supply chain and retailers.

“A more compact approach is usually not profitable in the long run,” O’Toole stated.

Having a carefully selected portfolio can lead to effective profit management.

Numerous individuals believe they are providing a service to shoppers, as research suggests that having less options, rather than a wide range of choices, can motivate shoppers to make more purchases.

In 2000, Sheena Lyengar and Mark Lepper, who are psychologists, conducted a study which demonstrated that having a limited selection is more beneficial for shoppers. The researchers found that when the number of jams on display was reduced from 24 to 6, consumers were 10 times more likely to make a purchase, despite being more likely to stop at a display with a greater selection. Further studies have also supported this finding.

According to Paco Underhill, whose company Envirosell analyzes consumer behavior, retailers are now realizing the importance of respecting shoppers’ time.

However, according to David Berliner, the head of BDO’s business restructuring and turnaround division, retailers cannot simply cut prices randomly.

According to Berliner, the goal is to make these cuts discreetly and maintain the appearance of a full store. However, excessive cuts may potentially drive customers away.

Source: voanews.com