1. SCARCITY MARKETING DEFINITION
In eCommerce, scarcity marketing could be defined as a factor that could make your business different from your competitors in a positive manner. This marketing strategy is also often known as FOMO (the Fear Of Missing Out) by focusing on the scarcity of a product in order to sell more.
Scarcity marketing could help increase your average order value as well as organic conversion rate.
2. TYPES OF SCARCITY MARKETING
There exists a human psychological phenomenon in which people would stop using a product when they found out there are too many other people also using them. If your business aims at people looking for status then eliciting a feeling of scarcity due to exclusivity could be an efficient scarcity marketing method. In fact, the product is not really scarce, but it is the high price of it that prevents people from owning it. Therefore, many brands make use of this in order to create a sense of exclusivity and make their products highly desirable.
The most common use of this method is by increasing the price of items. In fact, adding an “exclusive” could eventually devalue the product.
Research has shown that getting a product on sale feels like “winning” a bargain which means the achievement of both the feelings of utilitarianism and fulfillment. Therefore, making customers feel like they are smart shoppers and they are the winners are the main features of this marketing strategy. When a shopper learns that the item they are having their eyes on is nearly out of stock, they would tend to feel greater urgency to make a purchase immediately before it is snatched by another customer.
Also, informing them of “Ends today” or “Flash deal” will definitely trigger a feeling of urgency inside customers as the tactics of using such key phrases is to let customers know that your most popular items are running out, thus incite them to make a purchase immediately.
Often being mistaken with exclusivity due to their similar natures, rarity utilizes people’s needs to be both unique and exclusive. Consumers purchase rare items in order to increase their social status, generate envy and reduce the feeling of powerlessness. A common use of this method is by using copies like “rare” or “limited edition”, which is widely found in the fashion industry.