“SPOILT FOR CHOICE AND EXPECTING MORE”: What moderates the effect of assortment size on consumer expectations?

Abstract

Is more choice necessarily better? In this paper, we explore the choice overload hypothesis that more choice does not always benefit the consumer, this being due to over-heightened expectations from larger assortments, leading eventually to increased levels of negative expectation disconfirmation. Formally known as the expectation-disconfirmation mechanism, our research aims to investigate variables that moderate the effect of assortment size on consumer expectations. Overall, our findings provide empirical evidence for three moderators of this relationship - product variation, perceptual variance and lastly decision heuristics, contributing to existing literature by suggesting possible pre-requisites for the expectation disconfirmation mechanism to sufficiently occur. Using a multi-study approach, we conducted three separate studies to investigate the potential effect of these moderators. In Study One, we began our investigation with an experiment that aimed to test for the potential effects of product variation - the degree to which product categories differ along alignable, comparative dimensions and how additional choices represented options that were “truly different”. Study One showed that when the level of product variation was low, consumers who chose from larger assortments were unlikely to have higher expectations and levels of negative expectation disconfirmation compared to when the level of product variation was high. Study Two aimed to show that even though the level of actual variety might increase with an increase in assortment size, this might not necessarily translate to higher consumer expectations if the perceived level of variety remains lower or unchanged. Using assortment structure to manipulate perceived levels of variety within small and large assortments, Study two showed that in small assortments, expectations of disorganised sets were higher than organised sets; in large assortments, expectations of organised sets were higher than disorganised sets, and this relationship was mediated by the level of perceived variety. Lastly in Study Three, we showed that decision heuristics affect consumer expectations, where choice-makers who use the maximising heuristic are more likely to experience higher levels of negative expectation disconfirmation compared to choice-makers who use the satisficing heuristic. Based on these findings, we discuss theoretical implications and directions for future research, as well as implications for marketers.