I often come away with new insights on how to be more efficient and successful and that leads to an increase of our companies revenues. Funny as it may sound Apple Computer’s success is simple and basic.
Almost everyone knows that Apple Computers products are unique, and that drives sales, mainly from perceived scarcity and availability. This is a given.
However, one of the many insights I have taken away from Apple’s success is that they don’t offer a large number of choices for products. Strange as it seems, less customer choices lead to more sales and often increased revenues. It is well known that giving a customer too many choices can reduce sales, especially higher priced products.
If you visit their website or store you will notice that there is only one option for the wildly popular iPhone, only four choices of iPod’s, and only six options for their Macintosh computers. There is good reason that Apple does not offer 25 different options for their computers, unlike Dell for instance.
Repeatedly consumer research has shown that the more product choices you give a customer the less likely they are going to purchase. Call it “choice phobia” or “choice panic” if you will. The same thing can happen if you give customers too few choices as well.
For example, let’s say you have two products that do essentially the same thing, yet one has more features and costs a great deal more than the basic product. Even though the pricier product will provide more for the customer, the lower priced product will be purchased more than the high-end product. The funny thing is if you had a third similar product with a midrange price, customers will buy the mid-range product more than the less expensive basic product.
Apple has the product choice / sales increase down to a science. They understand the psychology or consumer buying and they use it, and as we all know, are making money hand over first year after year.
Apple sets itself apart from the rest of the technology industry, by creating unique products, ensuring that they are easy to use and intuitive, and by limiting the number of choices thrust upon customers.
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