Monday, November 20, 2006

The Scarcity Principle in Your Marketing

If you’re not using scarcity in your marketing you are really missing out. This one method will bring you loads more cash to your business than you thought possible.

To best illustrate scarcity all you have to do is look at the current situation of the Playstation 3 game console that just came out. Sony did not make enough consoles to go around (On purpose?). So, the consoles are scarce and therefore the value of the consoles goes way up.

A few days ago on ebay Playstation 3 (PS3) were going for as much as 3,600 dollars. That’s a pretty hefty price tag for a 600-700 dollar retail priced video game machine. People stood in line for DAYS to get their hands on the PS3 and most walked away empty handed.

The lesson to be gained from an event like this is that people are more likely to buy, and more likely to pay more for, a service or product that is limited in some way. You could limit the amount of time it is offered. You could limit the amount of people who will receive the product. You could even limit the amount of time a certain discount is in effect. But whatever you do, if you create a sense of scarcity (that is legitimate) you will get a lot more customers to buy than if you didn’t create scarcity.

Experiment with your marketing and try to find out how you can legitimately create scarcity.

For a far more scientific and thorough explanation of scarcity and other psychological triggers for marketing, check out the book called Influence: Science and Practice by Robert B. Cialdini. I highly recommend it and have read it several times.


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