Wall Street Journal
April 20, 2001
Too Many Choices --- Nine Kinds of Kleenex Tissue, Eggo Waffles in 16 Flavors: Blame Brand Managers
By EMILY NELSON
How did a trip to the supermarket get this confusing?
Lisa Orman spent five minutes in the toothpaste aisle recently, hunting down the type of Colgate she likes. She faced a dozen Colgate varieties -- some with baking soda or peroxide, others labeled "sparkling white" and "tartar control plus whitening." She grabbed one, but when she got home she discovered it wasn't the Colgate Total she wanted.
"I cursed myself through the whole tube," says Ms. Orman, a mother of two in Madison, Wis., who says grocery shopping takes her twice as long as it used to because there are so many product variations on the shelves.
Consumer-products makers churned out more than 31,000 new products in the U.S. last year, including multiple varieties of everything from tomato sauce to garbage bags. The typical grocer now stocks 40,000 items, double the number of a few years ago. The result: Kellogg Eggo waffles in 16 flavors, nine varieties of Kleenex tissue, and Glad garbage bags that offer twist, draw-string or handle ties.
Manufacturers say they can't help it. U.S. sales growth has stagnated for many products, so companies are banking on slight variations to entice customers to try something different. And with ever-more-advanced consumer-research,
they can identify different tastes and target products accordingly. Several executives say blame even lies with the structure of companies: Young brand managers who change jobs frequently like to introduce "new and improved" items to make their mark.
Take Procter & Gamble Co.'s Pert Plus, which the company for years promoted as a convenience product because it combined shampoo-and-conditioner in the same green bottle. Last year, P&G began offering separately bottled Pert
shampoo and Pert conditioner. Now, stores carry 19 types of Pert in varieties like "simply cleanse," "deep moisturizing,"
and "simply volume. "P&G figured plain-ol' Pert was losing male shoppers, who are now willing to spend more time and
money on grooming products.
That more-is-better approach can backfire, warns Mark Lepper, the chairman of Stanford University's psychology department, who studies how variety affects the odds that people actually buy. Mr. Lepper set up a table with 30 jars of jam and gave shoppers who stopped for a sample a discount coupon for their next jam purchase. He also had a table with six jams. He counted the coupons to see which group was more likely to buy. Of the shoppers who faced 30 choices, only 3% actually bought jam; of the shoppers who had six choices, 30% purchased jam.
"Too much choice was not a good thing," he concludes. People also feel bad when choosing from a broad selection because they second-guess their pick and worry they have made a poor selection, his follow-up studies revealed.
P&G, which sells 72 varieties of Pantene hair-care treatments, doesn't add products lightly, says Patrice Louvet, North American marketing director for Pantene. Still, he concedes that the selection of Pantene shampoo and styling gels has grown confusing.
The Cincinnati-based company recently repackaged Pantene to classify products by hair style with labels like "volume" and "smooth, sleek and straight" instead of "normal" or "oily" hair. It also added pamphlets to explain Pantene styling tonic, mousse and gel, and to generally "hold the hands of consumers," Mr. Louvet says.
Often, the impetus to launch new products is the fight for shelf space, says Tom Vierhile, general manager at Marketing Intelligence Service, Naples, N.Y. Consumer-products companies vowed to trim offerings several years ago, he says, but didn't follow through out of concern that a competitor would take any shelf space they gave up. "I think it's a land grab to some extent," he adds.
A manufacturer typically gets shelf space by paying a slotting fee, or rent, for the space. The best spots -- like the end of an aisle or an eye-level shelf -- typically cost more. As a result, makers with the deepest pockets, not the most popular products, can hog the shelves.
A few stores are fighting back. Wal-Mart Stores Inc., the world's largest retailer, says it doesn't charge slotting fees. Its sales go up when it has popular products, more than compensating for lost fee revenue, it says. The retailer pressures its store managers to drop products that don't sell well and pushes manufacturers to supply the most popular varieties.
At Stew Leonard's, a chain of three supermarkets in Connecticut and New York, trimming variety is part of overall customer service, says Stew Leonard Jr., the president and owner. Managers review item sales weekly, looking to discontinue "a hit list" of laggards, he says. Without such discipline on the part of retailers, he says, "the number of [stocked] items is overwhelming" for shoppers.
Meanwhile, profit pressures are forcing companies to curb their offerings. P&G blames its current financial struggles, in part, on introducing too many products and neglecting its staples. Rival Unilever, which makes Dove soap and Lipton tea, has spent the past year cutting its portfolio of brands to 970 from 1,600 and plans to shed another 250, a spokesman says.
Colgate-Palmolive Co., which makes 19 types of Colgate toothpaste, has begun to discontinue one item for each it introduces. But executives say new items drive sales growth: Last year, 38% of its $9.4 billion in sales came from products introduced in the past five years, and 61% of its U.S. sales came from recent introductions. According to a Colgate spokeswoman, "All of them are
sold because there are people who really desire that product."
Credit: Staff Reporter of The Wall Street Journal