I’ve watched an intriguing video on TED.com that talked about a simple way some companies are increasing their profits. In short, they’ve found that offering their customers fewer choices can lead to more purchases than offering many choices.

Sheena Iyengar (the inaugural S.T. Lee Professor of Business in the Management Division at Columbia Business School) who gave the talk, says that we have a “choice-overload problem” in today’s world. She had held an experiment at an upscale grocery store to see whether or not having too many choices affected a consumer’s ability to choose and ultimately buy a product. What she discovered is pretty remarkable.

In one study, customers were offered 6 different choices of jams to sample. The other study offered 24 different jams. She found that more people sampled jams when there were 24 choices. But surprisingly, customers were 6 times more likely to buy a jar of jam when offered only 6 choices! Sheena explains that when we have choice-overload, “We choose not choose, even when it goes against our best self-interests.”

Using this theory may also help us create better visual design. When we develop layouts for advertisements and websites, it’s important that we don’t overload our viewers with too much to see and read. It’ll get so complex and confusing that we’ll end up losing our target audience’s decision-making abilities.

Watch Sheena Iyengar’s talk below and tell us your thoughts about this topic!