he principle of scarcity
Clarifying what the principle of scarcity is is much simpler than it might seem. Anyone trying to buy a product or book a vacation online will have found themselves browsing a portal that, from the first moment, does nothing but remind us of one thing: availability is limited.
Whether scarcity is real or intentionally generated need not concern us. What should activate our curiosity is this mechanism works, so much so that it has been one of the most widely used persuasion techniques in marketing since before digital existed.
But what is this principle based on? The basic idea is that any product or service, the moment it is lacking, becomes more desirable.
The principle of scarcity according to Robert Cialdini
The first to define the concept in a structured way was Robert Cialdini in his book "The Weapons of Persuasion" (Cialdini, 1984). In the book he argues that human beings are in an emotionally difficult moment when they are faced with the possibility of losing their freedom.
In fact, what is an OUT OF STOCK notice if not a limitation on our freedom of choice? The moment that product goes out of stock, we would no longer be able to choose it and, therefore, we are more willing to make the purchase the moment we know we may lose the opportunity in the future.
The principle is simple: we want now what we may not be able to get in the future.
When things become less available, they become more desirable. If we have the choice to get something definitely now or perhaps in the future, then we choose to get it now.
4 declinations of scarcity
An interesting article in Medium pitted this concept further, focusing on how scarcity can be declined into four different aspects. Each of these aspects can work better than the others in certain contexts; the variables to consider in evaluating their effectiveness are product, producer and consumer.
The declinations of scarcity are as follows:
- Exclusivity
- Rarity
- Urgency
- Excess demand
The principle of scarcity: Exclusivity
Some brands apply a price increase whenever a new product model is launched, even if the price increase itself is not justified by the technical improvements that have taken place.
This form of scarcity can be called Exclusivity Scarcity. It is an implicit scarcity because in itself the product is not scarce, but the increase in price raises the acquisition barrier by making its possession more difficult (and thus of greater symbolic value).
Harder-to-reach products are therefore more exclusive and desirable and are also able to transfer the exclusivity status to the consumers who purchase them. A producer-induced scarcity to the consumer by using price as a purchase barrier.
The principle of scarcity: Rarity
Deeper than exclusivity, however, is the concept of rarity. In this context, scarcity is real and in fact it is the producer who induces scarcity by acting on the quantity of product. We call it rare rather than exclusive because a production limit is set early in the life cycle.
Economic value, unlike exclusivity, is not the 'only barrier to the consumer; large amounts of money can give access to exclusive products but not always to rare products. Scarcity therefore is real but is also sought by the producer to increase value.
For this reason, owning a rare item has a greater symbolic value; those who seek it are also looking for rare items to acquire a higher status or to stand out to satisfy their need for uniqueness.
The principle of scarcity: Urgency
Through increasing price, the producer induces scarcity vis-à-vis the consumer by creating exclusivity. But it can also do this in another way: by acting on time.
Adding a deadline to a bid or product availability increases the sense of urgency dictated by the passage of time.
Supply is scarce because scarce is the time left to take advantage of it. The motivational effect goes beyond the offer itself; it relates to the idea of being a smart consumer capable of buying at the right time. An implicit satisfaction derived from winning in the game "against" other consumers and the company.
The principle of scarcity: Excess demand
The simplest, and perhaps even purest form of scarcity, on the other hand, comes from excess demand.
No forcing on the product or consumers by producers. It is simply the market deciding that a product has value by triggering a mechanism whereby everyone wants to get a hold of it.
This mechanism once triggered carries with it another principle identified by Cialdini that makes it even stronger and more powerful: social proof. In short, I buy because in many others before me have bought and from this I infer that the product has great value.
Therefore, the consumer will be driven by fear of missing out and confidence inspired by the purchase of others.
Conclusions
The principle of scarcity can come in many forms, but these have a very simple principle as their basis: the greater the possibility of losing access to a product or service, the greater the desire for it.
Consciously using this principle can make the difference between the success or failure of a product/service launch in the market.
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