What Is Scarcity Marketing?

scarcity marketing

Act now! Ending soon! Offer limited to stock on hand!

All of the above phrases are examples of scarcity marketing – a marketing tactic that involves tapping into people’s inherent FOMO (fear of missing out).

It’s the reason hotel sites say “only three rooms available at this price,” the reason companies deliberately under-stock high-demand items, and probably the reason you didn’t get a Tickle Me Elmo for Christmas in 1996.

At heart, scarcity marketing merely leverages supply and demand. The less likely people are to be able to get their hands on your product or service, the more they’ll be willing to pay for it. It’s an easy enough concept to understand in theory, but putting it into practice can requires some finesse.

Here are a few ways you can put scarcity marketing to work for your small business.

Limited-Time Offers

There’s a reason that sales don’t last forever: If they did, it wouldn’t be a sale anymore.

Limited-time offers add a sense of urgency for your customers. “If I don’t buy this now, I’m going to pay more later; therefore, buying it now is the better deal.”

It’s a great tactic for getting people who are on the fence to finally pull the trigger. It’s also a great way to snare people who had no intention of buying in the first place.

Don’t be shy about letting people know exactly when the deal ends. “Limited time only” is arbitrary. They might have an hour, or they might have a month. “Limited time only! Deal ends at 11:47 p.m. on Tuesday, March 29!” adds time-specific pressure to close the deal.

Countdown Timers

Imagine your favorite band is coming to town. You’ve spent hours in the virtual queue for the chance to purchase a ticket, and it’s finally your turn. You hit “best available seat” and hope for the best, only to find out you’ll be sitting in nosebleed country facing the back of the stage.

You’re tempted to throw that ticket back into the pool and try again, hoping for a better result. But the moment that ticket was presented to you, a countdown timer appeared, informing you that you only have five minutes to complete your purchase before your seat is released, and that you’re not guaranteed another ticket will be available.

Faced with this dilemma, most customers will take what’s offered, because it’s better than the chance of getting nothing instead.

Inventory Counters

Another scarcity marketing tactic is showing your customers how many products you have remaining. As the numbers tick toward zero, the tension builds.

People who weren’t quite sure about booking that trip to Jamaica when there were 23 flights available start to sweat a little when that number drops to 10. They’re rushing for their wallets when they see that only three remain.

Again, the less of something there is, the more valuable it becomes to the consumer.

“Act Now” Add-Ons

How many times have you heard this phrase on a television commercial?
“And when you act in the next 15 minutes, we’ll throw in (insert bonus here)!”

Marketers use it because it works. Whether it’s free shipping, an extended warranty, bonus components or anything else of value to the consumer, time-sensitive add-ons are a cost-effective way to move more product out the door without cutting too far into your bottom line.

In marketing, we call that a win!

Ready to Take Scarcity Marketing for a Spin?

Scarcity marketing is all about offering customers something they won’t want to miss out on. Whether you use timers, inventory counters, limited time deals or any other “hurry up and buy before it’s gone” tactic, increasing the urgency will also increase your sales!

Need more marketing tips, tricks, and resources? Mischa Communications has everything you need to be a small business superstar. Let’s talk.