Choice Overload, Hospitality and Individual Decision

Traditional economic and psychological theories contend that decision-makers

benefit from having more options. However, the choice overload notion contends that
having too many options can occasionally lead to contradictory outcomes, such as
customers making "no choice" or feeling more regret than usual (Park and Jang,
2013). In this essay, inspired by Dr. Lyengar's experiment, I analyzed and evaluated
the decision-making process of travelers on holiday destinations; choice overload
and restaurant menus, and lastly, choice overload to individuals. I also demonstrated
my personal view on these cases.

Dr. Lyengar has given two Ted Talks on "choice overload," but I particularly like the
first one in which she talks about the "Jam Study," a project she worked on as a
doctoral student at Stanford University. Dr. Lyengar visited an expensive urban
market with her study team. The first time, they set up a sampling booth with 24 jars
of jam, and the second time, they only had 6. In the end, it was discovered that even
while somewhat more people stopped for a taste when 24 types of jam were
available, just 3% added one to their shopping cart. However, when given a choice
between six options, 30% of customers purchased a jar of jam. She has repeated
this kind of research over the years in other consumer marketing projects, and the
outcomes are consistent.

The experiment from Dr. Lyengar gave me a lot of insight as a hotelier. For
instance, the overloaded choice is affecting consumers' holiday destination decision-
making. People first decide whether they would take a vacation and, if so, how long it
should last. The choice of a destination that fits the duration of the trip is made
during this preliminary step. Later on, consumers settle on further choices involving
vacation packages, transportation, and lodging, to mention a few.

Travelers might not be aware of the potential drawbacks of large choice sets,
although having more options might be advantageous when selecting a holiday spot.
In my point of view, choice overload happens in tourism situations for the reasons
listed below. First off, there are so many options that it might be daunting (Park and
Jang, 2013). When looking for vacation packages from Sydney to New York in
December, for instance, Expedia returns more than 400 results, and analyzing such
a profusion of choices requires significant cognitive work. Second, due to the
seasonality of travel as well as intense sales or promotions that encourage speedy
booking, travel decisions are frequently made under time pressure (Park and Jang,
2013). As a result, visitors could feel as though they do not have enough time to
explore all of the appealing possibilities. Finally, most travelers have a natural desire
for novelty and variety (Feng, 2007), especially when it comes to travel places (Bello
and Etzel, 1985). Travelers frequently face a choice set with a large number of
unknown possibilities, therefore being unfamiliar with the options is a necessary
prerequisite that results in choice overload effects.

Today, providing various options does not always translate into improved satisfaction
levels or a reduction in travelers' regretful thinking, contrary to quite an amount of
what destination marketers or travel agencies may believe. When travelers are
presented with a broad range of destination options, they are less satisfied with their
destination selections and express greater regret after making the choice.

I believe it is vital for destination managers and the key role in a hospitality business
to carefully re-evaluate the variety of goods and services they are offering to their
clients. Therefore, As a hotelier whose future will be in managerial positions, I will
review the portfolio of services and products that we have to offer to our customers
because it appears that when it comes to choices, "less is more." For instance, when
an in-market audience visits hotel websites or OTAs to hunt for current deals and
promotions, hotels or OTAs should refrain from overwhelming customers with too
many options, in particular, not too many types of package selling. In my own
experience, too many choices in packages on a hotel website can make one very
confused, in the worst case, they might not want to choose at all, and choose to
book another hotel instead. Similarly, the recommendation system should not
display or reveal all options on the first page when customers search for holiday
information in a specific category (such as a large variety of F & B outlets, options
on menus, beach destinations, etc.) without asking them if they want to expand the
search results.

It is important to realize the problems with choice overload, and it takes a long time
for the business owner or manager of the hotel to adjust the information that they
want to present to their potential customers. I would suggest using different tools,
such as SEOs, to analyze the data, by finding out what is the most interesting
information (with the most clicks ) for our target market, it shall be more feasible to
decide what we want to present to our target market, and then able to adjust the
information accordingly over the time.

Another interesting fact that I noticed is the menus in different F&B outlets, the menu
has a significant role in the promotion, presentation, and management of the
restaurants. Menus vary depending on the type of establishment, ranging from a
shortlist to a vast selection of things that may even come from numerous sources.
Giving an example of where I live, Prague, the capital city of the Czech Republic. In
the city center, where a lot of tourists visit historical monuments, one single
restaurant can offer a full menu that can include Czech, American, Italian, and many
types of dishes, from breakfast to dinner. The principle of regularity, which asserts
that adding an item to a choice set cannot enhance the likelihood of selecting an
item from the original group, is evidence from the choice theory that supports the
assumption that consumers benefit from being given more options (Rieskamp,
Busemeyer, & Mellers, 2006). But often, making a decision involves searching and
analyzing options. Searching is based on the availability and variety of goods,
whereas evaluating is based on the accessibility and complexity of information about
the options. I can understand the views of these tourist-based types of restaurants,
they intend to attract more customers, as in Prague the tourists are highly diverse
and international. However, the selection process is therefore restricted and slowed
by having more knowledge of the choice items, and it has been discovered that the
ideal number of options is fewer for more complicated things where a more
significant number of factors must be examined (Hauser & Wernerfelt, 1990; Iyengar
& Lepper, 2000; Reutskaja & Hogarth, 2009).

As a manager of this type of restaurant, I would focus more on one target market
only and restrict the menu accordingly. In my point of view, the amount of time that
the customers are also our cost, spend on choosing from the menu directly related to
the turnover rate per table, the more time they spent, the higher cost will occur. A
limited menu can attract the right audience, and save tangible costs for a business.

Last but not the least, as a young professional and a business owner myself, I often
face situations with choice overload. Just to name a few, when I was younger, I had
to choose what kind of career path I wanted to pursue; At the moment, I am facing
what type of products I want to present and sell to our customers, now and in future,
I will also be making a lot of choices, such as time management, family choices,
investment options. I believe that, as an individual, it is important to set a KPI for life
and set goals for the KPI and pursue them accordingly. For instance, when I make
an investment decision, I would focus on the ROI and risks, therefore filtering the
massive advertisements which are less useful for me. As the CEO of our company, I
know what I need to achieve every year and the responsibilities on my shoulder, by
knowing the result that I want to obtain and evaluating the consequences carefully of
each choice that I have to make, I can look for the information that I need which can
help my decision-making process.

The world now is a world with massive information, as long as we have KPIs in life,
we can filter the information and choices that are confusing us and make choices
with a clear mind.
References

Bello, D.C. and Etzel, M.J. (1985), “The role of novelty in the pleasure travel
experience”, Journal of Travel Research, Vol. 24 No. 1, pp. 20-26.

Feng, R. (2007), “Temporal destination revisit intention: the effects of novelty

seeking and satisfaction”, Tourism Management, Vol. 28 No. 2, pp. 580-590.

Hauser, J. R., & Wernerfelt, B. (1990). An evaluation cost model of consideration

sets. Journal of Consumer Research, 16, 393–408.

Iyengar, S. S., & Lepper, M. R. (2000). When choice is demotivating: Can one desire
too much of a good thing? Journal of Personality and Social Psychology, 79(6), 995–
1006.

Johns, N., Edwards, J.S.A. and Hartwell, H.J. (2013). Menu Choice: Satisfaction or
Overload? Journal of Culinary Science & Technology, 11(3), pp.275–285.
doi:10.1080/15428052.2013.798564.

Park, J.-Y. and Jang, S. (Shawn) (2013). Confused by too many choices? Choice
overload in tourism. Tourism Management, 35, pp.1–12.
doi:10.1016/j.tourman.2012.05.004.
Rieskamp, J., Busemeyer, J. R., & Mellers, B. A. (2006). Extending the bounds of
rationality: Evidence and theories of preferential choice. Journal of Economic
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Reutskaja, E., & Hogarth, R. M. (2009). Satisfaction in choice as a function of the

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