THE INFINITE MENU

28 Feb. 2024 Changes.Unipol.it Changes Unipol Company Note

#consumption #investments #abundance #uncertainty

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SUMMARY

• The abundance of products and services resulting from globalization and digital aggregation raises the wall of choice so high that it leads us to three solutions: escape it, procrastinate it, or digress.
• Thus, in consumption and investments, when the menu becomes infinite and uncertainty is added, a blockage can occur, but cognitive science and technology can help us navigate through it.

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Where there is a great availability of physical or digital products, the choice becomes more difficult. If we think about the years of scarcity that humanity experienced up until a century ago, we find ourselves living in a paradox.

Let's try to recall the image of a five-year-old child in tears over a meager snack and see him today, hesitant, and undecided, facing the choice among a hundred possibilities, between packaged cookies and brioches. This initial abundance, resulting in an infinite offer, has come with the globalization of products and goods, available to everyone, quickly, over long distances, and at affordable prices thanks to economies of scale.

The image that best represents this evolution is indeed the shelf of every supermarket. Long, well-stocked, with extremely high differentiation among the thousand products even within a single category. An increasingly large number of items, types, and their character and quantitative variations, prices, measurements, and qualities, as well as operators and brands that produce them, have made our daily choice more difficult.

The digital multiplication

The second wave of abundance recalls memories from a few decades ago but has materialized with digital platforms, what we now associate with eCommerce, or subscription streaming services. Examples include Netflix, Amazon Prime Video, or Music. According to Nielsen's 2023 State of Play report, which measures audience engagement every year, the available content offering has reached 1.1 million individual programs. The Gracenote system, owned by Nielsen, has noted that available titles have increased over a couple of years (2021-2023), from 1.9 million titles to 2.7 million (in Germany, USA, Mexico, Canada).

More than globalization or previous economies of scale, here the cause of the abundance of possibilities is the immensely powerful digital capacity aggregation, able to expand the basic data (database) of each choice without limit.

The wall of choice

Now let's add up the three causes - economies of scale, globalization, and digital aggregation - and every time we have to choose, we find ourselves facing a choice wall that seems unassailable.

And with what consequences?

• The first is procrastination, or postponement. The choice is deferred in time - who knows for how long - bypassing the planned path, whether it be for purchase, service, or use. And the overload of possibilities ends up lengthening the path instead of shortening it.
• The second is escapism, or the definitive shelving of the initial idea. According to the streaming video report, faced with such a wide choice, many customers don't quite understand what interests them and switch to another activity.
• The third is digression. But a more sophisticated example is needed. Faced with this phenomenon, which we can call the infinite menu, the goal of the initial choice changes during the process precisely because of the abundance of choice. And the consequence is digression. The example is precisely the shopping center, or even a social network, or YouTube or Google itself: we enter to get one thing, but once inside, the goal becomes to stay and digress, spending time there.

Consumption and investments: infinite possibilities

Let's now try to relate these cases to the current uncertainty, reduced precisely to the occurrence of an infinite possibility of events, most of which are without our knowledge or ability to predict.

• In the field of consumption - where we started our reasoning - it has recently happened that uncertainty has led us to doubt, but in doubt, we have consumed. The most current uncertainty, however, with the addition of a high cost of money and products, always brings doubt, but in doubt, one prefers to save. Somehow, we stop.
• In the field of investments, this paralysis stemming from abundant offerings in uncertain contexts unfolds like this: I used to invest, even with the risk of losing, but I did it. Now I leave the money untouched or well protected, for better times.

Navigating between offer and doubt

What to do if we are in times of abundance of choice and offer, but also of uncertainty and doubt? Let's take a step back. The abundant offer and choice that we aimed for fifty years ago had a very specific meaning: the sense of freedom that all those who had experienced poverty and scarcity during the two wars had been deprived of. Is it perhaps a coincidence that the shopping mall purchasing model arrived in Europe precisely from the country that brought post-war freedom to Europe? In any case, today's abundance and offer have different assumptions, and they want to demonstrate to us how technology can deliver, concretely and in our hands, an infinite individual choice.

So, we have two possibilities.

1. Consciously manage choices with our cognitive endowment, better organizing our minds in the magnificently described ways in the book by neuroscientist Daniel Levitin "The Organized Mind: thinking straight in the age of information overload."
2. Resort to technologies - Apps, infinite analyses, databases, user interfaces - the same ones that today give us abundance and now demonstrate their ability to save us from it.

https://changes.unipol.it/society-3-0/lofferta-infinita