The New York Times on framing consumer choices

Tags: Advertising, Marketing, Tyranny of too much

Today's New York Times has an interesting article on how careful framing of consumer choices can radically affect business results in insurance, 401(k)s, and coffee. It's another spin on how consumers cope with what we call the tyranny of too much. Apparently, the challenges of getting consumers to make choices have become so severe that it's starting to have economists interested.

At McDonald's, people buy the combo meal when they might rather just have a small order of fries with their Quarter Pounder. Car buyers take the options that come as part of the most heavily promoted package even if they do not want all of them. For their 401(k), many workers simply accept the contribution rate and the investment choices their company picks for them. In countries where being an organ donor is the default choice on driver's licenses, many more people are listed as organ donors.

The habit is so widespread that some economists have begun making a novel argument. Sometimes, they say, the more severe and the worse that a default option is, the better off people will be. Only then will they take matters into their own hands.