How Scarcity Drives Sales
If you've ever stopped by Amazon in the days leading up to Cyber Monday, you know the feeling of not wanting to miss out on something that will soon be unavailable.
Fortunately, you don't have to be an e-commerce behemoth to use scarcity to fuel sales. Take it from Brian Roberts, founder and CEO of street-inspired jewelry company Refinement Co., who says the strategy can serve any online retailer well, if it's done right.
Play With Deadline Variants
The purpose of scarcity, whether it's real or not, is to make a product seem more desirable so even the worst procrastinators feel compelled to make a purchase. It works with deadlines and what Roberts calls "an elevated product." You can do it several ways, he says.
- A product goes online at X time and offline by Y time. Countdown timers make such a window even more effective.
- At X time the price will raise to Y, or say "preorder today to save Z amount."
- It could also be a value-added deadline, such as "Buy product X and get A, B, and C free" or "Buy X and get another X free."
- Real-time stock counts involve only selling a certain amount of something and once it's gone, it's gone for good.
"What I love about these is that they heighten the value of the product," he says, "and you're no longer just selling another commodity, or in my case, another piece of jewelry. Somehow now it's rare, and it makes people care about it."
Use Scarcity Selectively
A few scarce and elevated products can act as a magnet for your entire line, Roberts says. For example, Refinement Co. sells custom jewelry made with precious metals that tends to run for higher prices and sell out faster than some other products for sale on the website. If someone can't afford the elevated product or misses out on a deal, there are plenty of mass-produced silver- and gold-plated items to buy on the site, so anyone can satiate a scarcity-induced urge to buy.
Don't Be Slimy
If you're going to offer limited quantities don't tarnish your reputation by being deceitful about stock levels or having a "limited run" that really never runs out. "Every day when I'm driving to my office, I see these furniture stores that have these big signs outside that say they're going out of business, and they've had those same signs up since they opened," Roberts says. "I would never step foot in that [kind of store]."
Don't Put a Pig on a Pedestal
If you're going to sell something scarce, it needs to be well-designed and beautiful at every touch point, from the product images you use on your website to the copy and graphic design on the packaging. "It really has to be a work of art, because otherwise you're just a snake oil pitchman, and you're not going to have any longterm success at whatever it is you're trying to build," Roberts says.
Scarcity and Social Media
Roberts even uses scarcity to get more people to engage with his brand on social media. The first thing you'll see at the Refinement Co. website is an in-your-face image of a tatted-up guy with grills (a dental accessory) in his mouth. Alongside sits an invitation to follow the company on Twitter, hand over your email address, and click to tweet a link to a product page. Comply and you'll be entered into a daily drawing for a free set of grills--for a limited time, of course.