How Not to Use Scarcity Marketing
Conveying a sense of scarcity and urgency are powerful marketing techniques that tap into the psychology of why we say “yes.” When utilized correctly, scarcity marketing can give your company and sales a massive boost.
Part of what makes urgency and scarcity techniques in marketing so powerful is its focus on the psychology that makes humans want what is hard to attain. An effective way to convey urgency in your marketing is doing it in a way that is different, well-thought out, and doesn’t read like another promotion.
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On the other hand, when done wrong, you can hurt the reputation of your business and lose the loyalty and trust of your customers:
One research article published by Scientific Journal Publishers found “when consumers interpreted scarcity claims as a sales tactic, the positive effect of scarcity claims on product evaluation would be diluted.”
The effective scarcity marketing techniques are the ones you most likely never even notice. Eventually, consumers and readers will notice these sleazy urgency tactics and scarcity mistakes, and they’ll quicky become annoyed by them. That’s when those marketing efforts backfire on those companies who thought they could pull one over on their customers.
Urgency Without Scarcity Won’t Work
Bed, Bath & Beyond is known for their ‘20% off one single in-store item’ coupons. Looking back, the oldest proof I could find of them offering these coupons were back in early 2007! So certainly something must be working for them….
We all receive these coupons in the mail and then in our emails a few times each month. As consumers, we don’t worry about missing out on a Bed, Bath & Beyond sale. That’s because we now know that there will be another coupon coming from Bed, Bath & Beyond every few days. And we know exactly what it is going to be.
However, if you’re getting awesome results with continued urgent promotions, then keep on doing your thing.
For everyone else: don’t assume that your company or business will be able to get away with this type of promotion strategy. There’s nothing urgent or scarce about a promotion that has been happening every week or so for years.
Instead, if you want to cash in on the psychology behind scarcity marketing, ensure that when you are creating urgency in your promotions that there is some scarcity to your offer.
False Urgency Ruins Customer Loyalty
Creating a sense of urgency is a great boost for many marketing campaigns. Just make sure there is actually something that is worth the urgency and feeling of anxiety of missing out.
Some websites use a false scarcity tactic hoping to get customers to quickly act before the item disappears. Marketer, Mike Michalowicz noticed that one of his favorite online stores, CoffeeForLess, were manipulating their customers by creating a false sense of security.
When shopping for his Keurig K-Cups, Michalowicz noticed that as soon as he put an item into his cart, a timer began ticking. But why?
CoffeeForLess created a false sense of urgency to squeeze a few extra dollars out of their customers. It didn’t take long for Michalowicz and other customers to catch on. He explains it best when he says:
“I can’t fathom that they are really reserving coffee for me. First of all, it is quite likely they have more than enough stock so that ‘reserving’ coffee for 30 minutes is not necessary. Plus, if I sat on my filled up cart and did nothing, while another order processed for the same coffee, the coffee would go to them, not me.”
Many of the scarcity-focused strategies we’ve talked about create level of urgency and anxiety, but only use a countdown timer for legitimately urgent items.
By putting too much pressure on your customers to act, they may feel like you’re forcing them and not letting them make their own choices. It’s a guaranteed, sure-fire way to break ties with loyal customers while manipulating new visitors.
Accidentally Alienating Customers
Mailbox was an iOS productivity app that had a ‘controlled roll-out’ that released invites to the app to small groups. If you were not at the front of the line, you had to wait… For an indefinite period of time. If you weren’t invited, you could still use the app for one thing: to check how many people were ahead of you! 20K in front of you, and then you’re in!
Well backlash came fast, and it came hard for the young email app. Frustrated and irritated customers punished Mailbox for the wait. The people still waiting for invitations trashed the app by writing awful reviews in the App Store, never mind that they had never used Mailbox’s features.
Here’s what we can learn from that horrible scarcity marketing error:
- People don’t like to wait.
- Customers don’t like for companies to make them feel under-valued.
- Finally, perception is everything. Many still believe the whole stunt was a marketing campaign from the app company.
Don’t Abuse ‘Urgency Words’
Groupon is known for sending plenty of emails to their subscribers and most of their subject lines seem like they’re yelling at you:
ACT NOW! HURRY! LAST CHANCE!
Those are just some of the commands that Groupon ‘shouts’ at you in nearly every subject line of their emails. Whatever they’re promoting, Groupon manages to always claim the same level or urgency and scarcity for their offers.
It’s not just one or two emails a day where Groupon is abusing standard urgency words either. Subscribers usually receive 4-6 emails from them daily and all of them are promotional.
One problem with this technique is that visitors will remember which products and/or businesses have used (more like abused) the principles of scarcity. Now these customers will look at future interactions with doubt and hesitation.
The Clothing Store Who Cried Wolf
The principles of scarcity are a strong way to boost sales and make more money. Yet, use it too frequently, and like the boy who cried wolf, people customers, influencers, everyone will stop believing you.
Gap, only a few years ago, loved to creat would create a massive sense of urgency in their email subject lines. Obviously that didn’t pay off in the long run and instead, many of their messages ignored.
We spoke of it earlier, and yes, it is possible to use too much urgency. You can overdue the urgency to such an extent that customers, leads, and subscribers will ignore it all. In one article written by a frustrated marketer, Gap had sent him five nearly identical urgent emails, in less than a week…
Of course, customers may not notice the frequency of these kinds of messages, certainly not right away. A few too many emails about scarce supplies, limited-time promotions, and ‘Today Only’ sales, and visitors will stop paying attention to whatever you’re saying.
Scarcity Marketing’s Most Effective Techniques:
Scarcity in marketing is an old tactic based off the psychology of human persuasion. Even in today’s marketing world, scarcity principles still work.
Scarcity makes people take action if they are sitting on the fence, it can create a higher perceived value that will put you ahead in a competitive niche. Most importantly though, it gives your company an environment where you can to focus resources and maximize ROI.
Save this list below to make sure you’re taking advantage of Scarcity Marketing’s Most Effective Techniques!
- Set a deadline
- Advertise the deadline on your homepage
- Restrict deals to ‘offer open until stock lasts’
- Offer daily deals
- Create urgency on cart page
- Provide free shipping for a limited period
- Let your customers know that stocks are limited
- Use holidays to create urgency
- Never falsely advertise or abuse the demand
Sincerity is vitally important because consumers are very good at sniffing out insincerity and exaggeration when it comes to marketing.
Don’t get caught up trying to beat your competition head on. Switch up normal format and take the higher, more honest road. Scarcity and urgency are two incredible marketing tactics that will help you along the way to success!
Have you ever seen a company create a false sense of scarcity or urgency? Let us know in the comments!
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