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Scarcity as a marketing strategy
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The art of motivating people to buy when you want them to is often based around creating a sense of urgency through a call to action. In
its simplest format, that call to action might be as simple as stating "Limited offer" or "Offer for this month only".
These simple calls to action are effective on some people, but others may need a little more prodding as the "limited offer" spiel is used so widely and many people may be blind to it.
Most humans have an innate fear of scarcity. The prospect of product they are
possibly interested in suddenly becoming unavailable at that price can help create a tipping point, spurring them on to
investigate and purchase.
The marketing blurb "Offer this month only" or the use of a countdown
timer script can create an increased sense of urgency as it states a set time; but with people being so busy and having a tendency to procrastinate, it can be easily forgotten.
Something you may like to try in your marketing efforts that I've seen work very well is to create an ongoing scarcity campaign in your store. The beauty of this strategy is you won't need to outlay a cent for high tech marketing tools, it's an ethical strategy and very easy to implement.
Let's say you're considering offer purple flombles for 20% off next month and your goal is to sell at least 100 at the discounted price. Instead of running the typical "20% off offer for this month only", try tackling it this way. Here's a rough example:
"Super Special - Purple flombles reduced from $X to $X! - ONLY 100 LEFT AT THIS PRICE!! This offer won't last long
- get yours now before stock runs out!"
The above blurb reinforces the fact that not only is this a time limited special, but also product availability is limited to a definite number. The prospective customer has no idea how long it will take you to sell the one hundred - it could be days, hours, or minutes.
The important thing to remember with this marketing strategy is to regularly
decrease the number however you see fit; perhaps once a day, and to only let the offer run for the defined time - e.g. a month. Don't decrease the number by a static amount; vary it each time. One day you may reduce it by 10, the next by 8.
This is an ethical strategy as far as I'm concerned you're
well within your rights to offer as many or as few at the stated price at
any given time and to change those numbers as you see fit. The goal isn't to
sell at your regular higher price, but to sell at a lower price and make it
up the profit loss on an individual item in volume.
This marketing strategy can work particularly well if you have a regular newsletter or other
subscriber mailings. Showcase the offer in each communication; but perhaps don't mention the price; for example:
"This month we have an amazing special on Purple Flombles - but you'll need to be quick as there's only X left at this point at the substantially reduced price!".
This sort of blurb generates curiosity. How much were the Flombles originally? How much are they now? There's only x left when this was mailed out, so how many are left
now? Many will visit your site purely out of curiosity and while they may not buy that product, other items may be purchased.
The trick here is to have a different, higher number left available in the mailout than the availability number on the site and showcase other products on the
landing page.
There's magic in numbers - you're probably aware of the old "$9.99" pricing point as a way of making it sound cheaper than 10 bucks. Different scarcity numbers you'll probably find to also trigger purchasing by different customers.
These types of scarcity campaigns can be run on an ongoing basis, but choose a different product or service each time. If you keep the same campaign for the same product going for too long and don't change the availability numbers regularly; it will lose its impact.
Also use this marketing strategy as another opportunity to cross-sell and up-sell if your
shopping cart supports that feature.
Cross-selling is offering an additional, usually related product at the point of
checkout. The person who first suggested; "hmm, why don't we ask customers if they want fries with their order?" was a genius.
Up selling is offering upgrades or add-ons to the existing product; using the food industry again as an example: "would you like to super-size your fries for only a dollar extra?".
Never underestimate the potential profits in up selling. I've worked with
companies where 30% of sales revenue is derived from cross-sells and up-sells.
Using scarcity as a marketing strategy is very simple to implement and maintain; why not give it a try, it might be just what your online business needs to take your profits to the next level!
Related articles:
Free countdown timer script
Creating effective landing pages
Crafting marketing copy
Mailing list software and
services
Shopping cart software review
Michael Bloch
Taming the Beast
http://www.tamingthebeast.net
Tutorials, web content, tools and software.
Web Marketing, Internet Development & Ecommerce Resources
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