We probably all have experienced an act upon scarcity. Whether it was the last dress in that size of the last seat on an airplane, you had to get it as fast as possible, right? This is nothing new. It is natural to have an increased urgency to buy (now) having the knowledge that the stock is almost empty. But there are more cases, and of course more opportunities to use this for your own e-commerce benefit.
Usefull and Wise Words
While researching this topic I stumbled upon this great piece of knowledge by Robert Cialdini. In his book Influence: The Psychology of Persuasion he describes scarcity as one of the 6 ‘principles of influence’. This is what he has to say about it:
As opportunities become less available, we lose freedom; and we hate to lose freedoms we already have. This desire to preserve our established prerogatives is the centerpiece of psychological reactance theory, developed by psychologist Jack Brehm to explain the human response to diminishing personal control. According to the theory, whenever free choice is limited or threatened, the need to retain our freedoms makes us desire them (as well as the goods and services associated with them) significantly more than previously. So when increasing scarcity – or anything else – interferes with our prior access to some item, we will react against the interference by wanting and trying to possess the item more than before.
– Robert Cialdini, The Psychology of Persuasion
Scarcity is being used by many e-commerce website owners, because of it’s effectiveness. But are you already using it? In this article, we will discuss how you can use this on your website.
4 Methods for Scarcity and Urgency
So there are 4 main methods for creating a sense of scarcity and urgency:
- Stock Scarcity
- A Deadline
- Early Adoption
- Size scarcity
So what do these mean and how do you apply these?
Units available (Stock Scarcity)
This method is very simple, and common as well. Vendors will indicate that they have limited availability of a product or service. You will mostly see this in a way like in the picture below
This creates a sense of urgency for the customer. To use Amazon as an example again, they do this by saying they have limited stock available and that you should “order soon”.
It’s a fact: most items you can purchase today will get restocked. the factor that we aren’t sure whether or when they will be restocked will create the sense of urgency. This is an easy method to apply to your own website, most platforms like Shopify and WordPress offer plug-ins that will do the work for you.
You Another easy method is to set Deadlines. You will often see this combined with either discounts or availability. The reason why this is so simple is that all you have to do is set up a discount, set a date this discount will end and launch it. At the moment your customer knows your offering “10% off everything” they know they have to purchase it before that date, or they might “lose” money.
This can also convince people to purchase when they’re doubting. So when using this tactic, most retailers report that their sales increase. In fact, this spike is mostly reported with a 50% increase in sales on the last day before the sale ends. There are many ways marketers triggers this effect, like suggesting that certain products or low prices will soon be gone.
Early adopter angst
Before Apple, this might have been a tactic solely attributed to Christmas shopping (think ‘Tickle Me Elmo’). Apple then mastered early adopter angst in the 90′s and 00′s is now used to its intended effect by many distributors of electronics and other consumer products.
e-Commerce sites now use tactics like ‘Preview’ and ‘Pre-order today’ to drive interest and increase order frequency. This can be incredibly powerful, but can only be done so often as products of this nature tend to be very cyclical. And if you try to take advantage of this type of scarcity too often you’ll end up burning out your customer base.
This will probably be the most simple method, no plug-ins needed. Striking and graying out sizes that are going out of stock accomplishes a couple of things:
- Shows that the product is in-demand, thus increasing buyer interest
- Creates urgency that their size might be soon out of stock, if not already. This increases the chance of a purchase on that visit.
Creating a sense of urgency through scarcity is a powerful motivator for your customers. But it’s also important to make sure that you communicate this scarcity effectively. You can’t rely on random visitors to your website knowing ahead of time that you are running a sale, or that you are running low on a particular product. By creating calls to action reminding your customers of scarcity, you may invoke enough urgency around an unplanned purchase.
Scarcity has long been employed as a tactic to boost sales by retailers. You should still be wary of misusing these and other tactics as a pure money grab with your customer base. ‘Scarcity’ and ‘Urgency’ work best as motivators to quicken the buying process. It is important that the customer will have to be already convinced to make the purchase decision. Disingenuous messaging to offload inventory can have real and lasting damaging effects on your business. And as always, remember testing these tactics to smaller segments of your shopping base will inform you as to what might or might not work at scale.