The Role of Assortment Size and Option Attractiveness in Consumer Choice Among Retailers

Abstract

An important decision retailers make involves selecting the number of items comprising their assortments. A key issue in making these decisions concerns the role assortment size plays in determining consumers' choice of a retailer. We address this issue by investigating how consumer choice among retailers offering different size assortments is influenced by the
attractiveness of the options comprising these assortments. We show that consumer preference for retailers offering larger assortments tends to decrease as the attractiveness of the options in their assortments increases, and can even lead to a reversal of preferences in favor of retailers offering smaller assortments. We further present evidence that the relationship between assortment size and option attractiveness is concave, with the marginal impact of assortment size on choice decreasing as the attractiveness of the options increases. Our theorizing is supported by the data from five empirical studies, which offer converging evidence in support of the theoretical predictions.