“What we obtain too cheaply we esteem too lightly; it is dearness only that gives everything its value” – John Jakes
While there are several ways to significantly boost sales on your website and get more people to pay for what you have to offer, one of the most powerful tactics you can use that most people can’t resist is scarcity.
Scarcity is very powerful and if used correctly, not only can you double and triple your sales but your customers will also feel good and brag about taking advantage of your offer.
To better understand the power of scarcity, it’s important to know the story of how the potato became very popular; there are different accounts of this story but the premise is the same.
While potatoes are very popular today and are the favorite food for most of us, it wasn’t always the case; in the 1700s, potatoes weren’t as popular as they are today. In fact, most people avoided them; the French associated potatoes with leprosy and as a result flee them like the plague, the Germans thought potatoes can only serve as livestock feed and the Russian peasants saw them as poison; in other words, they see potatoes every day but not only do they ignore them but they were afraid of them.
This continued until Catherine the Great came into the picture; Catherine built tall fences around her potato fields and then placed signs around the fences asking that Russian citizens do not steal her potatoes. Instantly, something the Russian peasants have been seeing every day that was seen as poison has now turned into what the aristocrats are “hoarding” for themselves; instantly, Russian peasants wanted to eat potatoes more than anything else. It’s not something “the rich” can keep for themselves, it’s something every Russian citizen owns and as a result want!
While there are various accounts of this story depending on where you’re reading it, the premise is still the same; in other words, the Russians took the potatoes that was around them every day lightly because they could see it easily, until the rich began to keep the potatoes for themselves.
This story teaches something very important about human nature as well as a powerful marketing lesson; when people have easy access to what you have to offer, they won’t value it and will as a result ignore it. However, when they find out that it’s out of reach to them, they’ll want it more than ever.
With that said, scarcity is a force of nature that can transform your business overnight and this article will be sharing a few ways to implement scarcity in your business.
1. The Limited Time Offer
A great way to implement scarcity is by giving people limited time to act on your offer. This can be implemented in several ways; you could make your product available for a few days, after which it’ll automatically be taken down for awhile or forever. In other words, they either get it within the period you specify or never.
Another option is to offer to increase the price of your product or service if it’s not taken advantage of by a certain time; you could offer half a discount or give people a percentage off your product/service until that period is over.
If you’ve ever wondered why Black Fridays, Cyber Mondays and similar holidays have been very popular for sales, this is why; since people can only get a product or service at a cheaper rate during these periods and since it only happens once in a year, a lot of people buy; if they don’t, they won’t be able to have access the following year.
Furthermore, to show how effective this is, data from Statistics Brain has revealed that the amount consumers spend every Black Friday keeps increasing. Below is a screenshot that shows the average spending per person on Black Friday from 2010 – 2012.
If you’re using limited time scarcity to get people to take advantage of your offer, you can take things further by helping people visualize the offer as it disappears; in other words, if your offer expires in 2 days you can help people visualize it by having a counter that shows how time to get the offer disappears.
2. The Limited Stock Offer
Similar to the limited time offer, the limited stock offer also presents an offer in which people will miss out if they don’t take advantage within the limits you provide; however, unlike a limited time offer, the limited stock offer lets people see that only a number of products are available and that once it’s finish, it is finish.
In other words, instead of offering an indefinite amount of your product you can let people see that they’ll miss out if they don’t order quickly because you only have 10, or 12 or any amount you want, products available; this will be especially effective if your offer is tangible and there’s a cost attached to producing it as that’ll easily justify your reason for having a limited number available.
Depending on your business model, you might decide not to take your product off the market but to instead increase the price after a number of purchases have been made.
3. Real Time Scarcity
While most people won’t want to miss out, you can only imagine how they’ll feel if they watch what they can get disappear right in front of their eyes; in this case, the pressure to buy is high. This is where the real time scarcity comes in; in other words, people will be able to see live who is buying your product that has limited availability, when they buy it and how it disappears; if there are 10 products available and one disappears, and the others keep disappearing till it remains two… you can be sure that the remaining two won’t be available for very long.
If you’ve been studying or using sites like eBay, you’d have seen real life examples of scarcity in action.
Auctioning is a very powerful form of scarcity and it’s why someone will buy a baseball card for $1.2 million or a baseball bat for $570,000; you can see some of the craziest and most expensive eBay auctions here.
In other words, when people are bidding to buy your product they’re no longer competing with you but with themselves and this alone changes the game entirely.