The Law of Scarcity–Get Anyone to Take Immediate Action
Without a sense of urgency, desire loses its value.
—JIM ROHN
Online auctions drive me nuts. In most auctions, I find an item I like and I put in what I think is a reasonable, winning bid. I promise myself that I won’t bid higher. But I always get caught. When I get the outbid notice, I can’t believe somebody outbid me. What if I can’t find this item again? They obviously think this item is worth more than I do. Then I find myself wanting it even more—whatever it is—and I bid far more than I originally intended. The thrill of winning usually outweighs the pain of the price I paid.
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Why Scarcity Drives Us Wild
The Law of Scarcity plays a large role in the persuasion process. Opportunities are always more valuable and exciting when they are scarce and less available. We want to be the ones to own the rare items or to get the last widget on the shelf. The more the scarcity of an item increases, the more the item increases in value, and the greater the urge to own it.
Whenever choice is limited or threatened, the human need to maintain a share of the limited commodity makes us crave it even more. Scarcity increases the value of any product or service. Scarcity drives people to action, making us act quickly for fear of missing out on an opportunity. Potentially losing something before we’ve even had an opportunity to possess it drives people to action. We don’t want to miss out on anything we could have had. We want to get around any restriction placed upon us. We feel uptight and want back our freedom. This causes tension and unrest. The Law of Scarcity not only pertains to physical products, but also to time, information, price, and knowledge.
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The Law of Scarcity in Marketing
Psychologist Anthony Pratkanis of the University of California, Santa Cruz, is recorded as saying, ‘‘As consumers we have a rule of thumb: If it is rare or scarce, it must be valuable and good.’’
Department stores use the Law of Scarcity to bait consumers into an uncontrollable shopping frenzy. Fights break out at department stores when people are going after those scarce items, which are being offered at bargain prices for a limited time only. The lower prices are bait—a loss leader for the store, but certain to generate a buying frenzy that is contagious. Blinded by scarcity, consumers will buy anything and everything even if they don’t need it. For example, you see patrons buying three DVD players. You ask them why ‘‘three,’’ and they don’t know. All they know is that the store said supplies were limited, the sale was only for today, and each shopper was limited to three. So they bought three DVD players.
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Creating a Demand: Can You Say ‘‘Limited Supply’’?
Have you ever wondered why some ‘‘in’’ restaurants continue to have waiting lines outside? Long lines seem to make the restaurants even more fashionable, increasing the length of the line by an even greater degree. Why don’t restaurants eliminate the waiting line by increasing their prices? They don’t because removing the lines would eliminate the scarcity factor, and demand would collapse.
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Creating Allure
Think about when a woman wants to come across as more attractive to a certain man. If she can set things up so she will just happen to meet him while on a date with some other successful, attractive man, then she will appear to be more desirable than if she were merely to meet him alone at some club or bar. Or what if you were selling real estate? You’d be smart to have several interested people along for the tour of the property, since the interest of one client will heighten the interest of another. Instead of your potential buyer thinking, ‘‘Okay, I’m going to try to wheel-and-deal here,’’ he will think, ‘‘I’d better jump or this other guy’s going to get it before I do!’’
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How to Use the Law of Scarcity
Sometimes scarcity is necessary to help us make a decision. Most of us fear the point of making a decision, so we naturally want to put it off and allow ourselves time to think about it. As a persuader, however, be aware that when your prospects put off the decision, chances are they won’t make one.
You could have the perfect product for them—something they really need right now—but if you let them go, they will probably not come back later and tell you, ‘‘Okay, I finally decided. Let’s do it.’’ Creating scarcity helps your prospects make their decision. It also eliminates the amount of time you waste tracking down prospects who are still undecided about your product or service. You can create legitimate scarcity with your product or service without violating your morals.
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