When, for whom and why expanding single-option offerings creates value: locomotion fit from choice between options
Emerging direct-to-consumer brands, like Dollar Shave Club (personal grooming products), Sauce Boss LLC (sauces), and Muscle Box (fitness goods and supplements), challenge the commonly held view that customers are averse to single options and value having multiple options by reducing consumer choices. These brands start out by presenting consumers with a single option, but during growth they commonly add a second option and eventually expand to a few options per category, representing a key development in a brand’s life cycle as it diminishes cost advantages. Thus, for managers there is a lack of insights about when, for whom, and why a choice between two options vs having only a single option might lead to an increase in consumer spending.
Prior research has found conflicting effects of low or moderate number of options compared to a single option. This study seeks to understand motivational boundary conditions for aversion and explain some of these conflicts by considering locomotion orientation as a driving factor. Consumer’s locomotion orientation is the motivation for actively controlling progress in the decision-making process and moving toward goals. Thus, a set of two options is more optimal for high-locomotion-oriented customers as they favour choosing for themselves over being confronted with a single option, while seeing little additional benefit from increasing the number of options as this slows down their progress toward a decision.
Drawing on regulatory mode and regulatory fit theory, this paper argues that when the property of a decision set (e.g. having two options) match regulatory orientations (e.g. locomotion), consumer value perceptions are increased. It also explores engagement, which refers to consumers’ sustained attention when making a purchase, as an explanatory mechanism underpinning this value-enhancing effect.
Method and sample
This study consists of six different experiments. Study 1 tested the prediction that choice among product options increases consumers’ willingness to spend for high locomotors, with a sample of 178 participants recruited via Amazon Mechanical Turk (MTurk). Study 2 primed locomotion with video advertisements to draw stronger causal inferences, using a 2 x 2 between-subject design on 306 MTurk participants. In Study 3, established locomotion primes from prior literature were used instead to achieve stronger internal validity, with a 2 x 2 design on a sample of 127 Dutch university students and recent graduates. Study 4a explored the underlying mechanism of the value-enhancing effect by testing 214 MTurk participants’ experiences of active control and purchase engagement. Study 4b replicated Study 4a to rule out the possibility of an order effect explaining the sequential mediation, with 211 participants who were Dutch university students and recent graduates. Finally, Study 5, having a sample of 497 recruited on MTurk, contributed threefold: (1) it supplied further evidence for the regulatory fit effect; (2) it compared established locomotion vs assessment-based writing tasks to ensure consistent cognitive load across conditions and address alternative theories arising from Study 3; and (3) its sample size, determined with power calculations based on the effect sizes observed in Studies 1 to 4, was the most accurate approach.
Key findings
All studies demonstrated that different levels of locomotion affect value judgements, such as willingness to spend, when choosing among limited sets of options (one or two). Specifically, consumers with a chronic concern for controlling progress toward an outcome (high locomotors) value choosing rather than receiving an assigned product, regardless of whether single options are expert-selected. The study also showed the processes underlying the findings depend on the experiential benefits of having a choice. As choice results in experiences of active control that drive engagement among high (but not low) locomotion-oriented consumers, their value perceptions are increased.
Recommendations
These findings have three managerial implications for emerging direct-to-consumer brands. First, managers can prime locomotion using ads, for example, by using a copy that remind consumers that their products are “made for doers” just before offering a two-option product choice. This in turn can reduce consumers’ price sensitivity and increase profits.
Second, managers should measure customers’ locomotion orientations, for instance, by using an abbreviated locomotion scale when consumer sign up for their service or derive such information through textual data if the brand has significant social media presence. Important decisions on whether, when, and for whom to offer a choice can be derived from these insights, as assortment expansions create cost.
Finally, locomotion can vary depending on the time of day, customers’ level of physical movement, or across countries. Managers should combine these previously found insights with present findings to present services most appropriately to customers.
Researcher
More information
The research article is also available on eprints.