The Effect of Product Assortment on Buyer

Preferences

ITAMAR SIMONSON
Stanford University

Using product assortment to gain a sustainable differentiation is becoming increasingly

difficult in the current retail environment and is likely to become even more challenging as
the importance of location continues to decline and the share of Internet-based retailing
increases. Recent research, however, suggests that product assortment can play a key role,
not only in satisfying wants, but also in influencing buyer wants and preferences. This
article reviews and synthesizes empirical evidence indicating that (a) retailers can use the
assortment subset that buyers consider to enhance the likelihood that a purchase will be
made and to affect the specific option selected, (b) the manner in which the set of
considered options are presented also affects buyer preferences and purchase decisions,
and, (c) the effects of the considered options and presentation format interact with other
elements of the marketing mix such as sales promotions. The implications of these findings
for retailers, including ethical aspects of influencing buyer preferences, are discussed.

Marketing management and retailing textbooks highlight the importance of product

assortment in achieving differentiation and satisfying the wants of target shoppers better
than the competition (e.g., Kotler 1997, pp. 571–3). However, offering products that a
significant number of consumers want and which are not also available from competing
retailers is becoming increasingly difficult. Indeed, any product and style that prove
popular are rapidly adopted by other retailers. Furthermore, as the importance of location
decreases and the share of electronic commerce and catalogs increases, achieving signif-
icant differentiation through product assortment is likely to become even more challeng-
ing (but see Alba et al. 1997). For example, one would be hard-pressed to find significant
differences between the book selections of Amazon.com and Barnes & Noble.com
Despite this trend, concluding that product assortment (i.e., the total set of items offered
by a retailer, reflecting both the breadth and depth of offered product lines) will become
an (important) nonfactor in retail competition may be premature. In particular, retailers
and marketing textbooks might have treated the role of assortment too narrowly, focusing

Itamar Simonson is the Sebastian S. Kresge Professor of Marketing, Graduate School of Business, Stanford
University, Stanford, CA 94305-5015; tel. 650-725-8981; simonsonitamar@gsb.stanford.edu. The paper has
benefited from the comments of Ran Kivetz.

Journal of Retailing, Volume 75(3) pp. 347–370, ISSN: 0022-4359

Copyright © 1999 by New York University. All rights of reproduction in any form reserved.

347
348 Journal of Retailing Vol. 75, No. 3 1999

on its function in satisfying customer wants. However, recent research suggests that
assortment and the manner in which it is presented have another key role, which has not
received much attention. Specifically, in addition to satisfying existing wants, assortment
can shape consumer preferences and affect whether and what they purchase.1
The present research reviews and integrates some of the findings relating to the effect
of assortment on purchase decisions and offers general propositions for retailing research-
ers and practitioners. It is proposed that, as product assortment becomes a less important
differentiating factor, there is a need to focus more on the design of the assortment subset
that individual consumers consider (the “considered assortment”) and the manner in which
these products are displayed and evaluated. Thus, in addition to the more global function
of assortment in satisfying consumer wants, marketers can tactically design their assort-
ment so as to influence buyers’ preferences.2

The Effect of Product Assortment on Preferences: Empirical Evidence

Consistent with classical economic theory it has been assumed that consumers can
assess the utilities or values of products based on their characteristics and that these values
guide purchase decisions. For example, given information about the memory size, speed,
monitor type and other features of a personal computer, a consumer can assess the value
of that product. If offered more than one personal computer, the consumer can simply
determine the value of each alternative and then select the one with the highest overall
value.
Recent research on decision making, however, has revealed that people often do not
have clear and stable preferences, even when they have complete information about the
characteristics of the alternatives (for reviews, see, e.g., Bettman, Luce, and Payne 1998;
Simonson 1993). These findings are consistent with the idea that, in many situations,
consumers construct their preferences when faced with a specific purchase decision, rather
than retrieve preformed evaluations of product features and alternatives. Because prefer-
ences are constructed for a specific choice set and decision task, they depend on the
particular characteristics of the considered options and the manner in which they are
evaluated.
These findings have important marketing implications, suggesting that the impact of
product assortment cannot be assessed in isolation based solely on the utilities of the
offered items. Instead, one has to analyze carefully the product assortment context and
specific implementation, considering such factors as the assortment subset that consumers
compare, the manner in which options are presented and evaluated, and interactions with
other marketing mix variables (e.g., promotions).
A comprehensive review of all the findings that are consistent with this general
proposition is beyond the scope of this article. Instead, building primarily on studies in
which the author has been involved, this article focuses on three main categories of
assortment effects on preferences. The first category, choice set (or context) effects, refers
to the effect on consumer preferences of the composition and configuration of the
assortment subset that consumers consider. Second, holding the considered set constant,
The Effect of Product Assortment on Buyer Preferences 349

product assortment can affect purchase decisions based on the manner in which it is
presented and evaluated by consumers. And third, the effect of product assortment on
preferences likely depends on other marketing mix elements, such as price, promotions,
and advertising. This interdependence will be illustrated based on studies that have
examined the interaction between assortment and sales promotions.

The Effects of Considered Assortment on Consumer Purchase Decisions

There is growing evidence that consumers tend to focus on the set of options they
happen to observe in a particular context (e.g., the items on the shelf) and use that set to
determine which, if any, of the options is attractive. That is, instead of thinking globally
about other available options in the same category and using other relevant prior knowl-
edge, consumers tend to overweigh the information provided by the particular set under
consideration. This tendency can have significant implications for retailers, since con-
sumers typically consider only a subset of the entire product assortment. Accordingly, the
configuration of the considered subset, rather than the total assortment, can be the key
determinant of purchase decisions. Next, some of the findings regarding the effect of
choice sets on consumer preferences are reviewed and illustrated, leading to several
general propositions.

The Effect of Adding Options on Purchase Decisions

Williams-Sonoma, a mail-order and retail business located in San Francisco, used to

offer one home bread maker priced at $275. Later, a second home bread maker was added,
which had similar features except for its larger size. The new item was priced more than
50% higher than the original bread maker. Williams-Sonoma did not sell many units of the
new (relatively overpriced) item, but the sales of the less expensive bread maker almost
doubled.
This effect on sales, which Williams-Sonoma did not anticipate, illustrates the effect of
changing the set of alternatives under consideration (or the choice set) on consumers’
purchase decisions. Specifically, the effect of the second, relatively overpriced bread
maker on the sales of the existing one is consistent with experimental evidence that adding
an alternative, which is inferior compared to another alternative, increases the share of the
(relatively) superior alternative (Huber, Payne, and Puto 1982). For example, Simonson
and Tversky (1992) gave one group of respondents a choice between $6 and an elegant
Cross pen. A second group of respondents chose between $6, the same Cross pen, and a
second pen that was specifically included because it was less attractive than the Cross pen.
As expected, in the presence of the less attractive pen, the choice probability of the Cross
pen increased (from 36% to 46%) at the expense of the $6 cash (virtually no one chose
the unattractive pen).
In another study, Simonson and Tversky presented respondents with color pictures and
descriptions of microwave ovens taken from the Best catalog. In one version, only two
350 Journal of Retailing Vol. 75, No. 3 1999

alternatives were presented: an Emerson oven with a regular price of $109.99, and a larger
oven by Panasonic with a regular price of $179.99. Both ovens were on sale for 35% off
their regular price. The other version of the questionnaire (evaluated by a different
respondent group) included, in addition to the Emerson and Panasonic ovens, another
Panasonic oven that was on sale for only 10% off the regular price. As expected, the
addition of the relatively less attractive Panasonic oven (only 10% off) significantly
increased the share of the original Panasonic (from 43% to 60%), with the Emerson oven
being the big “loser.” Thus, the addition of the relatively inferior Panasonic caused some
respondents, who would have otherwise preferred the Emerson, to choose the (less
expensive) Panasonic.
These findings are consistent with the notion that consumers have difficulty assessing
the value of an option (e.g., a Cross pen) when it is considered in isolation. One might
assume that consumers can evaluate each option relative to other alternatives to which
they have been exposed in the past and other relevant previously acquired information.
However, because such prior knowledge is less salient and needs to be retrieved from
memory, consumers are likely to evaluate the attractiveness of a product relative to the
other options that are considered simultaneously (see Biehal and Chakravarti 1983). Thus,
for example, if a page in a catalog presents three bread makers, consumers are more likely
to evaluate each of these options relative to the other two, as opposed to comparing it to
bread makers encountered in the past and information stored in memory. Consequently, if
one option appears clearly superior to another option under consideration, consumers may
conclude that it is an attractive alternative, which increases the likelihood of making a
purchase.
This analysis has two key implications regarding the impact of product assortment on
purchase decisions. First, they indicate that the total assortment that retailers offer may
have less impact on purchase decisions than the particular assortment subset that buyers
consider. That is, if retailers can control which specific options buyers consider, then they
can potentially design these subsets in a way that will enhance the likelihood of making
a purchase and of selecting a specific (high-margin) product.
A second, more specific implication relates to a particular choice set configuration that
affects purchase probabilities in predictable ways. Consistent with the above findings, the
addition of a relatively inferior option, as in the Williams-Sonoma and pen examples, can
increase the likelihood that a purchase will take place. Based on the same principle, the
addition of an option that is inferior relative to one existing option but not another, as in
the Microwave example, can shift choices from a lower-priced option to a higher-priced
(presumably, also higher-margin) option.3 That leads to the following propositions:

● Proposition 1a: The probability that a consumer will make a purchase is enhanced
if the considered assortment is designed such that one option is clearly superior to
another.
● Proposition 1b: The choice probability of a particular target option can be enhanced
by adding an option that is clearly inferior relative to the target option, but not
relative to other options in the considered product assortment.
The Effect of Product Assortment on Buyer Preferences 351

The Effect of Preferences For and Against Compromise Options on Purchase

Probability

Another effect of the configuration of the product assortment under consideration on

purchase decisions occurs when one option is perceived as a “compromise” and other
options as noncompromise or “extreme” options. Previous research indicates that, in some
cases consumers tend to prefer compromise options, whereas in other cases they tend to
avoid compromises (e.g., Simonson and Tversky 1992).
For example, respondents in one study were asked to choose among 35-mm cameras
varying in terms of their features and prices (descriptions and photos were taken from the
Best catalog). One group was given a choice between a Minolta X-370 priced at $170 and
a Minolta 300i priced at $240. A second group was given the same two options and an
additional camera, the Minolta 7000i priced at $470. Respondents in the first group were
split evenly between the two options. In the second group, even though the added option
was selected by 24% of the respondents, the share of the middle option (the Minolta
3000i) did not decline and actually increased somewhat (to 57%). In other words, the
addition of the Minolta 7000i increased the share of the middle camera (the one most
similar to the added option) at the expense of the cheapest camera.
Simonson (1989) demonstrated several other cases whereby the relative shares of
options are increased when they are the middle or compromise alternatives in the set under
consideration. However, the preference for compromises is not universal, and there are
many cases in which consumers actually tend to avoid middle options. For example, when
selecting among ice creams that vary in taste and fat, consumers typically take either the
best tasting option or the one with the least fat, but not the ice cream with intermediate
values. Similarly, when choosing among insurance plans, consumers tend to choose a plan
that offers the best coverage at a relatively high premium or a plan with the least coverage
and the lowest premium, but they tend to avoid compromise plans. It seems that some
attribute tradeoffs, such as between ice cream taste and fat, tend to elicit preferences for
(relatively) extreme options (e.g., “go for the best”), as opposed to (wishy-washy)
compromises.
It is noteworthy that the preference for compromise options was also observed with a
choice set of paper towels, where respondents could “feel” each option before making a
choice. Paper towels are a very familiar category with significant quality differences
among brands, which could be revealed by inspecting the products. Thus, the fact that
consumers were influenced by whether a particular paper towel was a compromise in the
set suggests that, even when consumers have full information about quality, they are still
influenced by the position of options in a particular set under consideration.
There is currently no comprehensive theory that allows us to predict the magnitude of
the compromise effect and, in some cases, even whether it would be observed. Intuitively,
however, one would expect to obtain a compromise effect when the option set involves a
tradeoff between attributes that (in the relevant range) are characterized by diminishing
marginal value. For example, although consumers prefer a laptop computer with more
memory and lower weight, the marginal contribution of better values on these dimensions
is probably diminishing. Accordingly, we would expect to observe a compromise effect in
this case. Conversely, when an important attribute on which options vary has increasing
352 Journal of Retailing Vol. 75, No. 3 1999

marginal value, we would expect to observe a preference for “extreme” options. For
example, if consumers tend to prefer either very high insurance coverage (with high
premium) or very low coverage, or if they like ice cream with exceptional taste (or,
alternatively, with very low fat level) disproportionally more than a conventional ice
cream, then we would expect that most consumers will actually avoid “compromise”
options. Future research might examine more formally the conditions that moderate the
preference for and against compromise options.
For retailers, the fact that consumers systematically prefer compromise or extreme
options in choice sets under consideration provides further evidence that the composition
of product assortment and, in particular, the subset of options that consumers evaluate
jointly, can have a significant impact on purchase decisions. Because compromise options
tend to be favored in some cases but not in others, one needs to determine first which case
applies and then choose the configuration that favors the “preferred” (e.g., high margin)
option.

● Proposition 2: Consumers tend to favor compromise (middle) options for some

product categories and attributes and tend to avoid compromise options for other
categories and attributes. A consistent preference for compromise options is ex-
pected when the differentiating dimensions are characterized by diminishing mar-
ginal values, whereas preferences for noncompromise options are expected when the
instrumental attribute is characterized by increasing marginal value. Retailers can
determine which case applies in a particular situation and design the considered
assortment such that it will appeal to consumers’ preference for or against compro-
mise options.

The Effect of the Number of Quality Levels in Product Assortment

on Purchase Decisions

One characteristic of product assortments is the number of quality levels (or tiers)
offered. Some retailers, including many catalogs, offer just one quality level, whereas
others offer two, three, or even four quality levels. For example, a store’s assortment may
include a generic brand, a store brand, and a national brand, or alternatively, a store brand
(e.g., a store brand of ice cream), a mid-tier national brand (e.g., Dreyer Ice Cream), and
a top-tier (premium) national brand (e.g., Haagen Dazs ice cream). Similarly, a retailer
may offer a basic VCR model with limited features, a midline VCR with some additional
features (e.g., hi-fi), and a top-of-the-line VCR with the most advanced features.
Extensions of research on the compromise effect indicate the number of quality levels
that buyers consider affect the likelihood that a relatively more expensive, higher margin
option will be selected. Simonson and Tversky (1992) showed that, in many cases, adding
a third, higher-quality tier to the set of considered options leads choosers to prefer a
higher-quality, higher-price option, with the cheapest option losing the most. On the other
hand, adding a third, lower quality option to a set does not shift choices to lower quality
levels. They also showed that, in most cases, introducing an option with an intermediate
price-quality level to a set with a low tier option and a high-tier option takes much greater
The Effect of Product Assortment on Buyer Preferences 353

share from the low tier alternative. In fact, in some cases, adding an intermediate option
increases the share of the high-price, high-quality option.
For example, one group of respondents chose between a pair of binoculars with 7X
magnification that cost $20 and a pair with 17X magnification that cost $44. A second
group of respondents chose from a set that included the same two options as well as a pair
of binoculars with intermediate attribute levels - 12X magnification and a price of $36. In
the first group 45% chose the cheaper pair (7X, $20) and 55% chose the more expensive
pair (17X, $44). By contrast, in the second group only 5% chose the cheaper pair, 71%
selected the expensive pair, and 24% chose the (added) intermediate pair. In other words,
the introduction of the intermediate pair actually increased the share of the expensive pair.
Thus, when buyers consider options at three or more price-quality levels (compared
with just two levels), they tend to avoid the cheapest, lowest quality option but not the
most expensive, highest quality option. Simonson and Tversky (1992) suggested that
consumers are particularly averse to choosing the lowest level on the instrumental
attribute (quality, performance) that represents the purpose of the purchase, whereas they
are less sensitive to choosing the worst level on other attributes (e.g., price). Moreover,
although consumers generally prefer lower prices, the highest price often signals higher
quality (e.g., Zeithaml 1988) and the lowest price signals lower quality, and these
price-quality inferences are likely to be more salient in a set of three or more options than
when there are just two options under consideration.
These findings have an important implication with respect to the impact of product
assortment on purchase decisions. Specifically, retailers could enhance the share of
higher-priced, higher-margin options by introducing an even higher-price, higher-quality
option, even if the added option does not capture a significant share. For example, a
restaurant might be able to increase the probability of ordering an expensive lobster by
including in the menu an even more expensive abalone entree. Furthermore, retailers can
introduce an intermediate option to decrease the purchase probability of a cheap, low-
margin option.

● Proposition 3a: The purchase likelihood of a higher-price, higher-quality item can be

enhanced by introducing an even higher-price, higher-quality item to the subset of
options that consumers consider.
● Proposition 3b: If the considered product assortment includes two options that vary
in price and quality, the addition of either an intermediate or a high price-quality
alternative takes more share from the low price-quality option than from the other
existing option.

The Effect of Offering Multiple Attractive Products on Purchase Timing

The findings presented so far indicate that the considered assortment can influence
whether a purchase is made and which option is selected. A related finding is that the
considered assortment can also affect the timing of purchase, and specifically, whether a
purchase decision is delayed. Tversky and Shafir (1992) illustrated this effect using the
following two versions of a consumer choice problem:
354 Journal of Retailing Vol. 75, No. 3 1999

● Version A: Suppose you are considering buying a CD player and have not yet
decided what model to buy. You pass by a store that is having a 1-day clearance
sale. They offer a popular Sony player for just $99, well below the list price. Do
you?:
(y) buy the Sony player
(z) wait until you learn more about the various models

● Version B: Suppose you are considering buying a CD player and have not yet
decided what model to buy. You pass by a store that is having a 1-day clearance
sale. They offer a popular Sony player for just $99, and a top-of-the-line Aiwa
player for just $169, both well below the list price. Do you?:
(x) buy the Aiwa player
(y) buy the Sony player
(z) wait until you learn more about the various models

In the group that received Version A, 66% indicated that they would buy the Sony
player. By contrast, in Version B only 54% chose to buy either the Sony or the Aiwa
player and 46% preferred to wait. In other words, expanding the considered set to include
a second attractive player increased the share of respondents who decided to delay the
decision. The explanation of this result is that, with two or more attractive options,
consumers experience decision conflict and have difficulty determining which is the
overall best alternative. Because consumers try to minimize the risk of making inferior
choices, they prefer to delay the decision till they have the information needed for
identifying the best overall alternative.
This finding suggests that retailers may actually lose by offering too much assortment,
if potential buyers consider two or more options about equally attractive. A more effective
strategy seems to be to design the considered assortment such that a consumer is given a
choice among several options, but the set includes one and only one option that is superior
for that consumer. For example, based on the pattern of past purchases, a direct marketer
can design its offerings to a particular consumer such that one option is likely to appear
clearly superior to all others.

● Proposition 4: Presenting to consumers two about equally attractive options can lead
to a purchase delay and a loss of sales.

Assortment Choice Set Effects Across Related (Complementary) Categories

The effects of product assortment discussed so far have all related to choices in a single
product category, where a consumer needs to decide which of the available options to
select. However, consumers usually purchase more than one product or service on the
same purchase occasion. A question that naturally arises is how product assortment affects
purchases of related items.
A simple rule is that the purchase of one item increases the likelihood of selecting a
The Effect of Product Assortment on Buyer Preferences 355

complementary item and decreases the likelihood of selecting a substitute item. Consistent
with economic theory, complementarity, and substitutability are typically defined in terms
of product function, such as coffee and cream, coffee and tea, or chicken and red wine.
However, Dhar and Simonson (1999) have recently proposed a broader definition of
complements, which refers to the fit between coconsumed items in terms of their attribute
levels rather than their function.
Consider the example in Table 1. A large majority of respondents indicated that Mr. A
was more likely to selected the superior, more expensive beer when he was sitting in the
section with a superior view. Similar findings were obtained with a variety of problems
and question formats, including a study in which respondents made real choices of a prize
bundle (an evening out, including a performance and a meal). More generally, Dhar and
Simonson showed that, in tradeoffs between a goal (e.g., maximizing pleasure) and a
resource (e.g., money), consumers prefer “highlighting,” whereby they consistently em-
phasize the goal despite high resource requirements on one occasion, and they consistently
minimize resource allocation on another occasion. These results indicate that consumers
seek consistent attribute levels within a consumption episode, with one enjoyable, high
quality-high price choice increasing the likelihood of making a second high quality-high
price choice, even though the two choices are not functionally related. Such preferences
for co-consumed items are observed when each choice involves a tradeoff between a goal
(e.g., enjoyment) and a resource (e.g., money).
In other situations, where the tradeoff is between two goals (e.g., pleasure and good
health), consumers prefer to balance two items consumed during the same episode.
Consider the example in Table 2. In this case most respondents expected Mr. A to take the
tasty, less healthy dessert after a healthy entree. More generally, when trading off two
goals, such as pleasure and good health, consumers tend to balance their choices within
a particular episode. Such a preference for balancing choices is also observed when
consumers make two similar selections on the same occasion. For example, consider a
consumer who smokes one cigar before dinner and one after dinner. This person has two
cigar types, one that is higher-quality, higher-price and a second that is lower-quality,

TABLE 1
Baseball Game
Assume that Mr. A, who is a baseball fan, frequently goes to watch games at the local stadium. Mr. A
often buys beer at the stadium, purchasing expensive imported beer on some occasions and
standard domestic beer on other occasions.
Consider his two recent trips to baseball games:
On one trip, Mr. A purchased a ticket in a section with a superior view at the price of $16.
On another trip, Mr. A purchased a ticket in a section with an average view at the price of $8.
On each occasion, Mr. A decided to buy some beer at the stadium. The concession stand at the
stadium offered a choice between two beers: a gourmet imported beer priced at $4 and a regular
domestic beer priced at $1.50.
When was Mr. A more likely to buy the expensive imported beer—when he paid $16 for the ticket
with the superior view or when he paid $8 for the ticket with average view?

Superior View Average View No Difference

356 Journal of Retailing Vol. 75, No. 3 1999

TABLE 2
Dessert
Assume that Mr. A is considering having some dessert after dinner at a nice restaurant. Mr. A eats out
frequently, eating low-fat, healthy desserts on some occasions and rich tastier desserts on other
occasions. Consider his two recent trips to a restaurant:
On one occasion, Mr. A had a main course of tasty but unhealthy New York steak.
On another occasion, Mr. A had a main course of a healthy, but not as tasty, low-fat pasta dish.
On each occasion, after the main course, Mr. A is deciding between two desserts: a great tasting, but
high-fat, chocolate cake and a low-fat seasonal fruit salad.
When is Mr. A more likely to order the great tasting but fatty chocolate cake—when he just had a
tasty, unhealthy steak or when he had a healthy, less tasty pasta dish?

Tasty Steak Healthy dish No Difference

lower-price. In this case, if the high/low price cigar is smoked before dinner, the low/high
price cigar tends to be preferred after dinner. Note that, unlike the baseball example above,
the two choices relate to the same item (cigar) as opposed to two different items (a seat
and a beer), which generates the different preferences.
These findings suggest that product/service assortments can be designed to appeal
to consumers’ preferences for complementary items. For example, today some food
establishments specialize in health food, such as fresh fruit smoothies and nonfat
frozen yogurt, whereas others offer mostly tasty but unhealthy food, such as pizza
parlors. This research suggests that pizza parlors can support their main (pizza)
business by also offering fresh fruit smoothies, which allow customers to balance the
“sin” associated with eating pizza. Similarly, an entertainment establishment may
offer package deals for multiple occasions, such as a season ticket that offers a
high-pleasure combination on some occasions (e.g., better seat and food) and a less
attractive package on other occasions.
Marketers may also try to initiate a particular context by influencing the first selected
item. For example, a restaurant may offer a glass of a high-quality wine at a discount so
that consumers will be more likely to designate the meal as a “special” event. On the other
hand, offering a cheap, low-quality item for free may have a detrimental effect on the level
of other items in the same consumption context.

● Proposition 5: For items that are purchased on the same occasion, the attribute levels
of one item can affect the attribute levels of another item, even when the two are not
functional complements or substitutes. Specifically, in tradeoffs between a goal and
a resource, consumers make consistent choices within an episode, whereas in
tradeoffs between two goals they prefer balancing the two goals within each
consumption episode.

The findings reviewed so far indicate that, holding the overall assortment constant,
marketers can enhance their sales and influence the purchase probabilities of different
items by carefully designing the assortment subset that consumers observe and consider.
However, the composition and configuration of the considered assortment is not the only
The Effect of Product Assortment on Buyer Preferences 357

determinant of purchase decisions. In particular, holding the considered options constant,

purchase decisions may depend on the manner in which product assortment is presented
and evaluated. This category of effects on consumer preferences is discussed next.

The Effect of Assortment Presentation on Purchase Decisions

Several recent studies illustrate some of the ways in which assortment organization, and
display, can affect preferences. Three such effects are described next.

Side-by-Side Versus Separate Brand Displays

A retailer can display all brands in a product category side-by-side, such that consumers
can easily make comparisons among them, or brands can be displayed in a way that is less
conducive to comparisons (for example, generic brands were typically in a separate
supermarket aisle). Also, promoted brands are often displayed at the end of the aisle, such
that comparisons to other brands in the category are more difficult to make. A question
that arises naturally is whether the mere fact that a brand is displayed separately, holding
the assortment in the category constant, affects the purchase decisions that consumers
make.
Recent research indicates that a separate display increases the purchase share of brands
that are associated with high perceived quality and high price, whereas it decreases the
share of less expensive brands (Nowlis and Simonson 1997). In other words, brands
associated with lower perceived quality, which offer a lower price or superior features
(e.g., higher magnification or vitamin content), are relatively better off when they are
displayed next to other brands, such that making comparisons is easy. Consider the
example in Table 3 in which one group of respondents were asked either to make a choice
(i.e., directly compare the two options) and a second group rated each option separately
in terms of purchase likelihood.
If display format had no effect on preferences, then we would expect the choice share
of each brand to be similar to the share of respondents who rate that brand higher than the
other brand. However, the results of seven studies reported by Nowlis and Simonson
indicate that the choice task, in which respondents need to make direct comparisons
between the brands, consistently favors (relative to the rating task) lower price options and
options that have superior features, but weaker brand name. Specifically, across different
studies, the choice share of brands with lower price or superior features brand was
between 10% and 30% greater than the share of respondents who rated these options
higher in terms of purchase likelihood.
These results can have important implications, because it is reasonable to assume that
display formats that make it easy to compare brands tend to elicit preferences similar to
a choice task, whereas separate displays are more similar to the rating task. Thus, brands
associated with higher perceived quality would benefit most from a separate display and
358 Journal of Retailing Vol. 75, No. 3 1999

TABLE 3
Buyer Preferences in Choice vs. Ratings: An Example
● Choice Task
TOASTERS
Imagine that you would like to buy a toaster. At the store you find the two alternatives below.
ALTERNATIVE A: K-MART store brand
Features: -2 wide slots;
-Mechanism centers bread in slot
-Automatically pops the toast up when done;
-Removable crumb tray
Price: $19.99
ALTERNATIVE B: BLACK & DECKER
Features: -2 wide slots;
-Mechanism centers bread in slot
-Automatically pops the toast up when done;
-Removable crumb tray
Price: $26.99
Which alternative would you buy?

● Purchase Likelihood Rating Task:

In the rating task, respondents were asked to imagine that they wanted to buy the product (e.g., a
toaster); they were presented with each alternative (the same alternatives included in the choice task)
separately and asked to indicate their purchase likelihood of that option, using the scale below:
Very Unlikely to buy 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Very Likely to buy

from being distributed through channels that do not also offer competing brands, and vice
versa for lesser-known brands with lower prices and/or superior product features.

● Proposition 6: Consumers are relatively more likely to purchase high (perceived)

quality, high price brands when they are displayed separately rather than next to
competing options, and vice versa for low quality, low price brands.

Assortment Display by Brand Versus by Model

As described above, there is evidence that consumers tend to avoid the cheapest option
in the set of options presented to them (Simonson and Tversky 1992). An important
implication of this finding is that the manner in which product assortment is displayed can
have a significant effect on consumer choices. This implication is based on the reasonable
assumption that consumers evaluate options the way they are displayed, as opposed to
“reorganizing” options in their minds to fit some preconceived choice rule (see, e.g.,
Bettman and Kakkar 1977). Specifically, retailers can often display options either by
brand or by model type. For example, a store or a catalog can display TVs by brand, such
that all Sony TVs are presented together, Magnavox TVs are shown on a separate display
(or page), and so on. Alternatively, the retailer can display all “basic” TVs together,
including Sony Basic, Magnavox Basic, and so on, “midline” TVs of all brands in a
separate display, and “top-of-the-line” TVs in a third display.
The Effect of Product Assortment on Buyer Preferences 359

The tendency to avoid the cheapest option in a set of three or more options suggests
that, if product assortment is organized by brand, then buyers are likely to consider
together different tiers of particular brands. Because consumers tend to avoid the cheapest
option, this display format should result in a relatively low share of the low tier (basic)
model. If, on the other hand, products are organized by product tier, then each display
includes different brand tiers (e.g., Sony, Magnavox, and Goldstar) of a particular model
type (e.g., top-of-the-line), in which case consumers are expected to avoid the cheapest
brand (e.g., Goldstar).
These predictions were supported in a study by Simonson, Nowlis, and Lemon (1993),
who asked consumers to make choices in various categories, with the set organized either
by brand or by price-quality tier. Consistently, when options were organized by brand,
respondents were relatively more likely to select the midline or top-of-the-line options and
less likely to select the cheapest option, whereas when options were displayed by product
tier, consumers were more likely to select the mid-quality and top quality brands.

● Proposition 7: The choice share of the cheapest considered brand is lower when
products are displayed by model tier, whereas the share of the least expensive model
is lower when product display is organized by brand.

Using Incomplete Option Descriptions to Influence Consumer Choices

When presenting their assortment to consumers, retailers can often present only partial
descriptions of options’ attributes. For example, a computer retailer may choose not to
present the weight or screen resolution for some portable personal computers. Further-
more, retailers decide on the position of each product relative to other displayed options.
Thus, if a particular piece of information, such as weight, is provided for two portables
that are displayed side by side, a buyer can easily compare the two options on that
attribute, whereas if attribute information is available for one option, but not the other, a
comparison of the options becomes more difficult.
Research by Slovic and McPhillamy (1974) and by Kivetz and Simonson (1999)
suggests that such decisions about option descriptions, and particularly, the attributes on
which buyers can or cannot make direct comparisons of options, might have a significant
effect on purchase decisions. Specifically, consumers seem to overweigh attributes that
allow them to make direct comparisons between considered options at the expense of
attributes that are unavailable for some of the options. In fact, Kivetz and Simonson
demonstrated that a systematic manipulation of missing attribute information can lead to
intransitive preferences, whereby A is preferred to B, B is preferred to C, but C is
preferred to A. Consider the example in Table 2
In a study using the example shown in Table 4, respondents (at an airport) were asked
to choose between each pair of PC options (A & B, B & C, and C & A). The results
indicated that 28% of the respondents preferred A to B, B to C, and C to A, indicating
intransitive preferences. Kivetz and Simonson examined alternative ways to decrease the
tendency to overweigh attributes on which options can be directly compared. One such
effective debiasing procedure involved asking respondents to rate the importance of each
360 Journal of Retailing Vol. 75, No. 3 1999

TABLE 4
Computer options
Portable PC X Portable PC Y Portable PC Z
Speed (Information 166 Mhz 100 MHz
(range: 85 to 200MHz) Unavailable)
Memory 12MB Ram (Information 24 MB Ram
(range: 4 to 32MB Ram) Unavailable)
Battery Life 8 hours 3 hours (Information
(range: 1 to 11 hours) Unavailable)

attribute before making choices, where the importance ratings guide the subsequent
choices.
These findings indicate that retailers can use the information provided about options as
a tactic to enhance the attractiveness of a designated (e.g., high margin) option by making
it easy to make comparisons on attributes on which that option is superior but not on other
attributes. Of course, certain attributes (e.g., price) must be presented, but information
about other attributes may or may not be presented, with missing values provided only on
request.

● Proposition 8: Retailers can increase the share of a target option by making it easy
for buyers to compare products on attributes on which the target option is superior
while making comparisons on other attributes more difficult.

The Interaction Between Product Assortment and the Marketing Mix:

The Case of Sales Promotions

So far we have examined the effect on purchase decisions of the configuration of the
assortment subset that consumers consider and the manner of presentation. Recent
research on the construction of consumer preferences has also shown that the effect of
product assortment on purchase decisions depends on other marketing mix variables. The
effects of these marketing variables, in turn, depend on the assortment subset that
consumers consider. In particular, several studies have examined the interaction between
sales promotions and the set of options that consumers consider, as described next.

The Effect of Considered Assortment on Asymmetric Promotional Response

Blattberg and Wisniewski (1989) and others have observed an asymmetric response to
promotions: the rate of switching from a low-quality low-price brand (e.g., a private label)
to a promoted high quality high price brand (e.g., a well-known national brand) tends to
be significantly greater than the rate of switching from a high quality brand to a promoted
low-quality brand. Nowlis and Simonson (in press) recently proposed that asymmetric
The Effect of Product Assortment on Buyer Preferences 361

switching depends on the assortment of products that consumers consider. Specifically,

they show that, if consumers consider three brand quality levels, such as a generic brand,
a private label, and a national brand, asymmetric switching is eliminated. Briefly, building
on an earlier finding of Simonson and Tversky (1992) regarding the effect of adding a
mid-tier brand on the shares of existing low-tier and high-tier brands, Nowlis and
Simonson propose that the mere fact that consumers consider three quality levels neu-
tralizes the forces that lead to asymmetric switching. For example, they demonstrate that
promotions on private labels are as effective as promotions on national brands when
consumers’ consideration sets include also a generic brand, whereas asymmetric switching
is observed in the absence of a generic brand. In addition, Nowlis and Simonson show that
asymmetric switching and the elimination of the effect if considered assortments include
three quality levels also occur when consumers consider three model (rather than brand)
tiers.
These findings indicate that retailers can affect the response to their promotions by
controlling the considered product assortment. For example, retailers can encourage
regular users of national brands to try a promoted store brand by displaying a generic
brand prominently, so as to enhance the likelihood that shoppers will notice all three brand
levels.

● Proposition 9: Asymmetric promotional response, whereby regular buyers of a

low-tier product are more likely to switch to a promoted high-tier product than
high-tier buyers to a promoted low-tier product, is eliminated when buyers consider
products at three quality tiers.

Product Enhancements and Promotional Premiums

Although assortment typically refers to the collection of individual items offered,

retailers and manufacturers increasingly offer consumers bundled products and premiums
or gifts with purchase (see, e.g., Blattberg and Neslin 1990). Such tactics allow marketers
to differentiate their product offerings and to use one product to promote another.
Although these tactics can be effective in increasing sales, recent research indicates that
they may also hurt sales if consumers find one component of a bundle or the offered (free)
premium unattractive.
Specifically, Simonson, Carmon, and O’Curry (1994) show that adding a product
feature or a premium that many consumers perceive as having limited or no value, whether
or not it is free, can significantly decrease sales of the core product. For example, one
problem was based on an actual sales promotion in which consumers were given a choice
between two brands of brownie cake mix: Pillsbury and the Lucky Supermarket brand.
The nonvalued premium was a Collector’s Plate that could be purchased for $6.19 (i.e.,
purchasing the Collector’s Plate was optional). There were three versions of the choice
problem. In one version, the option to buy the Collector’s Plate was offered to buyers of
the Pillsbury brand; in a second version, a Collector’s Plate was offered to buyers of the
Lucky store brand; and the third version did not mention the Collector’s Plate promotion.
362 Journal of Retailing Vol. 75, No. 3 1999

The results indicated that brand shares were consistently smaller, by an average of 13%,
when they offered the option to obtain the Collector’s Plate. Similar results were obtained
in several other problems.
These findings suggest that consumers often automatically avoid alternatives with
features, such as premiums, that have little (perceived) limited or no value, even when the
added features are free and optional. Thus, retailers and manufacturers should be very
careful when designing their product assortment, such as bundling different items and
using promotions that involve premiums or other offers. If a significant share of consum-
ers perceive the premium or a component of a bundle as having limited value, even when
this premium is optional and/or free, sales of the promoted item may actually be
decreased.

● Proposition 10: The effects of premiums and added features on sales depend on the
share of buyers who perceive them as offering value, with premiums/features that
are perceived by many as offering little or no value potentially decreasing sales.

Purchase Quantity and Variety Seeking

Retailers seek product assortment that would appeal to the variety of tastes of their
target customers. However, in addition to interpersonal taste differences, individual
consumers seek variety in many categories (for reviews, see, e.g., Kahn 1995; McAlister
and Pessemier 1982). Naturally, the more variety that product assortment offers consum-
ers, the greater their opportunity to choose different items within a product category. But
product assortment is not the only determinant of variety seeking behavior. Recent
research indicates that purchase quantity, or the number of units purchased in a category
on a particular shopping occasion, and the manner in which options are displayed on the
shelf can have significant effects on variety seeking (Read and Loewenstein 1996;
Simonson 1990; Simonson and Winer 1992). These effects, in turn, have important
implications for the product variety that retailers need to offer.
Simonson (1990) proposed that consumers are more likely to select variety when
making multiple choices in a category simultaneously rather than sequentially. This
proposition was investigated in a study in which participants were given a choice of
snacks. One group of respondents were presented six snacks (e.g., Snickers bar, a bag of
chips) and asked to indicate which one they wished to receive. They chose one item and
received it. The same procedure was repeated in each of the following two weeks, with the
respondents receiving the snack they selected. A second group of respondents were shown
the same six snacks, informed that they would receive one snack immediately and one in
each of the following two weeks, and asked to indicate which item they wanted for each
week. It was emphasized that there was sufficient supply of all snacks and participants
could choose the same snack more than once.
As was expected, respondents in the second group, who made snack choices for three
weeks at the same time, were much more likely to select three different snacks (64% of
the participants) than those who made one choice each week for immediate consumption
(9%). Simonson offered several possible explanations for these results, relating to the
The Effect of Product Assortment on Buyer Preferences 363

differences in the way consumers treat simultaneous choices for future consumption
compared with sequential choices for immediate consumption. Similar results and further
insights into the psychological mechanisms underlying these effects were provided by
Read and Loewenstein (1996).
In a related study, Simonson and Winer (1992) showed that the number of items
consumers purchase in a product category on a shopping occasion can influence what
they purchase. The data for this study consisted of scanner panel data of actual yogurt
purchases by households over a two-year period. Consistent with the earlier study, the
results indicated that, as the number of yogurt cartons purchased on a specific
shopping occasion increased, consumers were more likely to choose yogurt flavors
that they did not usually buy. In other words, consumers exhibited more flavor variety
seeking when purchasing more units on a shopping occasion (similar results were
obtained in the subsegment of single member households). This trend, however, did
not hold with respect to the variety of brands selected. In fact, as the number of yogurt
cartons purchased on a shopping occasion increased, consumers were more likely to
buy their “regular” brand (i.e., exhibited less variety seeking for brands). Using a
laboratory experiment, Simonson and Winer showed that this finding is driven, to a
large degree, by the manner in which yogurts are displayed at the store. Specifically,
because yogurts are typically organized on the shelf by brand, the enhanced task
difficulty associated with purchasing multiple units simultaneously encourages con-
sumers to concentrate on their regular brands.
These findings can have important implications for retailers’ product assortments and
the use of bundling and promotions for encouraging consumers to buy higher quantities
and select more variety within product categories. For example, by offering bundles that
consist of a variety of items (e.g., a box with a variety of dried soups or spices), retailers
might better cater to consumers’ preferences for variety when making simultaneous
choices and thus encourage higher quantity purchases. Also, retailers may want to
encourage consumers to diversify their purchases, such that they do not buy only one or
very few items. This could be achieved using a promotion whereby consumers must
purchase multiple units to obtain a certain discount. Specifically, the above findings
indicate that promotions which require simultaneous purchases of several items within a
category, such promotions will likely increase the share of less popular items that
consumers tend to avoid when buying just one unit on each shopping occasion.

● Proposition 11: Retailers can increase the quantity of purchase (in relevant catego-
ries) by offering bundles of different preferred items. Relatedly, retailers can
increase the variety of options that buyers select using promotions and other means
that encourage the purchase of multiple items in a category.

These studies illustrate some of the ways in which sales promotions interact with
product assortment to affect purchase decisions. Such affects likely apply to the interac-
tion between assortment and other components of the marketing mix.
364 Journal of Retailing Vol. 75, No. 3 1999

Three Psychological Principles Underlying the Effects of Assortment

on Buyer Preferences

As shown in the previous sections, the effects of considered assortment on buyer

preferences can take many different forms. However, a closer examination reveals that all
of these effects relate to three basic mechanisms by which product assortment impacts
preferences: ease of purchase justification, ease of information processing, and activation
of decision rules. These three principles are discussed next.

Product Assortment and Purchase Justification

Recent research suggests that purchase decisions, and decision making more generally,
can often be better understood based on the assumption that people select the option that
is easiest to justify to oneself and to others, as opposed to the traditional assumption of
utility maximization (see Shafir, Simonson, and Tversky 1993, for a review). That is,
because buyers are often uncertain about their preferences and about the utilities of the
available options, they cannot assess the true utilities of the options and rely instead on the
ease of justifying choices.
Several of the effects reviewed above can be interpreted as reflecting the impact of
product assortment on the ability to justify making a purchase and selecting particular
options. Consider the pen example in which the addition of an inferior pen enhanced the
willingness to give up $6 for a Cross pen. A straightforward interpretation of this effect
is that the inferior option made the selection of the clearly superior Cross pen easier to
justify, which increased its share at the expense of the $6 option. Similarly, the preference
for compromise options can be accounted for based on the principle that, when presented
with an assortment of products, buyers make choices that are easy to justify and are
associated with a low likelihood of criticism and self-blame.
As another illustration, consider the effect of adding to a product assortment an option
that is more expensive than all other options (e.g., adding a more expensive entree to a
menu or a higher-price toaster to a catalog). Because selection of the most expensive item
from an assortment is often susceptible to criticism, the addition of an option with the
highest price makes it easier to justify choosing the next most expensive item. Relatedly,
in a set of three or more options, buying the cheapest option may be difficult to justify,
because “you get what you pay for,” and quality is typically the instrumental attribute that
represents the goal of the purchase. Consequently, the manner in which options are
displayed, by brand or by model type, has a systematic effect on the choice shares of the
cheapest brand and the cheapest model.
The finding of Tversky and Shafir (1992) described above is another example of
assortment effects on consumer preferences that reflect the impact of purchase justifica-
tion. Buyers can easily justify buying a Sony CD player on “sale.” However, when faced
with two about equally attractive options, a Sony CD player on “sale” and an Aiwa CD
player “on sale”, consumers have difficulty justifying preferring one option over the other
and tend to delay the purchase.
The Effect of Product Assortment on Buyer Preferences 365

Finally, the effect of nonessential promotions and features is yet another case in which
difficulty of justifying choice can determine whether and which choice is made from a
product assortment. Choosing an item with unneeded features, such as a cake mix that
offers the option to purchase an unneeded Doughboy Collector’s Plate or a calculator with
unneeded functions, is susceptible to criticism and therefore tends to be avoided.

Ease of Information Processing

A great deal of research has supported the intuitive notion that the manner in which
information is presented has a significant effect on the manner in which it is processed
(e.g., Bettman and Kakkar 1977). The effect of information presentation is due to at least
two related factors. First, consumers tend to minimize their information processing effort
and are consequently sensitive to any factor, including information presentation format,
that affects the ease of processing. And second, the information presentation format makes
certain aspects more or less salient and, accordingly, more or less important in the
decision.
An example of this psychological mechanism is the effect of displaying options
separately versus side-by-side (e.g., Nowlis and Simonson 1997). When alternatives, such
as different toasters, are shown side-by-side, consumers tend to focus on those dimensions
on which it is easier to make precise, unambiguous comparisons and rely less on less
quantifiable dimensions. In particular, a side-by-side presentation of alternatives increases
the effective weight of price and feature differences, which are unambiguous and quan-
tifiable, and diminishes the weight of qualitative aspects such as brand names. Presenting
options separately, such as on an end-of-aisle display, has the opposite effect: brand names
that can be evaluated on their own (e.g., Black and Decker) receive more weight, and
prices (e.g., $39), which are less meaningful when evaluated in isolation, receive less
weight.
Ease of information processing underlies other influences of product assortment on
preferences, as illustrated by the evidence regarding the impact of missing attribute
information on choice (e.g., Kivetz and Simonson 1999; Slovic and MacPhillamy 1974).
When consumers have information for all considered options about some attributes (e.g.,
a laptop’s processing speed) but not others (e.g., weight), it is easier to rely on the
dimensions that allow direct comparisons. Consequently, such relatively easy to compare
dimensions receive more weight. In the future, new selling media such as the Internet may
provide new ways to influence the ease of processing information about product assort-
ment and thus impact purchase decisions.

Activation of Prestored Decision Rules

When faced with an assortment of products from which one or more options might be
selected, consumers might carefully process the available attribute information to deter-
mine which, if any, options to choose. Such a decision making process, however, can be
effortful and time consuming and it often does not lead to clear conclusions. Alternatively,
366 Journal of Retailing Vol. 75, No. 3 1999

consumers might apply a decision rule stored in memory, which simplifies the decision
(e.g., Bettman 1979). In particular, based on their experience in making similar decisions
and experiencing their consequences, consumers can develop a repertoire of decision
solutions that have proven themselves in problems with similar characteristics. Such rules
might be activated by the product assortment which affects the consumer’s choice
problem (e.g., the considered option set) and task (e.g., the manner in which the decisions
are made).
An illustration of a decision rule that is activated by the choice problem is consumer
preferences for complementary items. When choosing two items that “go together,” many
consumers believe in going “all out” (a “climax”) on one occasion and saving money on
another occasion, as opposed to having two “mixed-level” experiences. For example, most
consumers prefer having a tasty, expensive entrée and a tasty, expensive dessert on the
same evening and less tasty, less expensive items on another evening, as opposed to
having one expensive item and one inexpensive item on each occasion. Presumably, this
decision rule is based on the consumer’s cumulative experience that the combination of
two preferred and complementary enjoyment levels is super-additive, which more than
compensates for the companion all-negative (inexpensive) experience.
An illustration of a decision rule that is activated by the task is the finding that
consumers, who simultaneously make choices for several consumption episodes, are more
likely to select a variety of options than consumers who choose one option at a time for
immediate consumption. Evidently, the mere act of making multiple choices, even when
the selected options will be consumed at different times, elicits the rule that choosing
variety is superior to choosing the same item multiple times.

General Discussion

We are in the midst of a period characterized by profound changes in the marketing

environment and methods. Retailers have new opportunities, including selling through the
Internet, which also raise new challenges and competitive threats. Factors that tradition-
ally were the major determinants of retailers’ performance, such as location, have less
impact in the evolving environment. The present research has focused on the role of
product assortment, which is perhaps the most important element of retailing strategy.
While retailers will, undoubtedly, continue to use the breadth and depth of their product
assortment as means for differentiation (see, e.g., Broniarczyk, Hoyer, and McAlister
1998), the new environment makes it much easier to duplicate any successful offering and
reach similar target users (but see Alba et al. 1997, for a discussion of role of offering
unique merchandise on the Internet). These changes, however, do not mean that product
assortment will be unimportant in the future. In fact, recent research suggests that, in
addition to satisfying customers’ wants, assortment can play an important role in shaping
those wants. This article has examined some of the ways in which retailers can use product
assortment to influence purchase decisions, focusing on three main areas.
First, because buyers typically evaluate only a subset of the available products, rather
than the entire assortment, retailers can influence which sets of options are evaluated
The Effect of Product Assortment on Buyer Preferences 367

together and design these sets to achieve their goals (e.g., encourage purchases of high
margin items). As described, prior research suggests specific methods for affecting
whether a purchase is made and which option is selected. Such tactics can be used in most
store environments, and they are particularly easy to implement on the Internet or in
catalogs. For example, suppose that a retailer offers two pairs of binoculars at different
price-quality levels, and assume that the more expensive pair is more profitable. The
research reviewed here suggests that the retailer can increase total sales and the share of
the more expensive pair by including on the same page, screen, or shelf section yet another
pair of binoculars that is significantly more expensive and offers somewhat higher
performance (even if very few select the added item).
Second, holding the considered assortment constant, retailers can influence purchase
decisions based on the manner in which they are displayed. For example, sales of a
higher-priced item that offers the retailer a higher margin can be increased by presenting
that item separately from other items in the same category. And third, the research
reviewed above indicates that the impact of assortment on preferences moderates and is
moderated by the other marketing mix variables (e.g., sales promotions), which need to be
coordinated to achieve the sales goals.
Although these influences of product assortment on consumer preferences represent a
wide variety of factors, it is noteworthy that all of these effects are based on three
psychological principles (see Figure 1). One class of effects reflects the impact of product
assortment on the ease with which certain choices can be justified. A second category of
effects are related to the ease of information processing, whereby consumers tend to prefer
options with advantages that are more transparent given the manner in which the
information is presented. And a third way in which product assortment influences
preferences is by activating specific decision rules that consumers store in memory, such
as the rule that variety is better than repetition.
A potentially disturbing aspect of the evidence that product assortment can be used to
affect purchase decisions is that it may transform the primary role of assortment from
satisfying wants to manipulating wants, which might be considered unethical. Although
making an absolute determination that a particular approach is ethical or unethical is often
difficult, a relative judgment can be made. Specifically, if attempts to enhance sales by
manipulating the presented options and the manner of product display are unethical, then
much of what marketers routinely do is similarly unethical. For example, advertisers and
retailers have been using a variety of tactics that are designed to enhance sales without
offering additional value to the customer (such as using a likable endorser or background
music). Thus, using product assortment in combination with other means to influence
purchase decisions can be seen as an extension of current practice.
It is also important to recognize that such influences on purchase decisions are most
effective when consumers do not have clear preferences and are thus susceptible to
influence. In addition, considering that choice set and presentation effects occur whether
or not they are planned by retailers, it may be practically impossible to determine whether
such tactics are manipulative or naturally occurring phenomena. For example, if a sales
person shows a customer two refrigerators and suggests that one of the two is a better deal,
does that constitute a manipulation?
Of course, the fact that assortment effects on buyer preferences are not inherently
368 Journal of Retailing Vol. 75, No. 3 1999

FIGURE 1
The Effects of Product Assorment on Buyer Preferences

different from other common marketing practices and are often naturally occurring does
not mean that marketers can deceive buyers by providing incorrect or misleading infor-
mation about their products. At the same time, retailers can choose which products to offer
and how to present them based on an analysis of the effect of these decisions on buyer
preferences. Future research may further examine the boundaries of ethical assortment
effects on preferences. Future research may also investigate ways to educate buyers about
the various influences on their preferences and how to avoid such effects. For example,
buyers can be encourages to think globally about the range of products to which they have
been exposed, as opposed to focusing narrowly on the choice set offered in a particular
channel.
Such educational programs will become even more important in the near future,
because, as indicated, the advancement of new retail channels and technologies suggests
that retailers will have more opportunities for influencing preferences. In particular, the
Internet and the use of agents to identify options can make it much easier to influence
The Effect of Product Assortment on Buyer Preferences 369

buyer preferences based on the assortment shown and the method of presentation. Thus,
product assortment will continue to be a key component of retail strategies in the new and
existing retail channels, though its role may evolve from simply satisfying wants to more
proactively influencing buyer preferences.

NOTES

1. It could be argued that tactics that are designed to make products appear more attractive,
gain attention, or have a certain image are also illustrations of the effect of product assortment and
display on purchase decisions. In this research, the focus is on less obvious effects of the assortment
of options that consumers consider and the manner in which they are evaluated and compared.
2. This implication raises important ethical issues, which will be discussed later.
3. A meta-analysis of prior studies indicates that the impact of adding an inferior option on
consumer preferences is particularly potent when the relatively superior alternative offers higher
quality (rather than lower price) than the other existing option Heath and Chatterjee 1995).

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