Want is a powerful motivator. As consumers, we are always in a need state and often in a state of want. How a strategic design agency creates want and desire for your brand or product is multi-faceted, dynamic, and unique to your customer and offering. One subservient form of marketing is scarcity marketing. Once you see it, you know it. And once you experience it, you understand its draw.
Scarcity marketing is an approach businesses can employ to drive demand by increasing the perceived value of a product, either by limiting the amount supplied or the time the product is available. This method creates an "Illusion of scarcity" that ignites purchase behavior and draws focus and attention to the brand. It can also serve as a test-and-learn approach for new product offerings, helping to control production and inventory costs by gauging customer interest and demand. Simply put, it shortens the consideration phase and triggers purchases, amplifying emotional response versus thoughtful, rational consideration. Additionally, some scarce product offerings can demand a premium price, thus generating a higher margin for the brand.
Some examples of scarcity marketing brands have employed:
- Gaming. An aspect of the popular global game Fortnite is the purchase of “Skins,” which are cosmetic outfits for a player’s avatar. Fortnite offers default skins, but creative agencies note the use of scarcity in offering unique, high-profile skins for a limited time, purchased by V-bucks, their in-game currency.
- CPG. Yeti has used its limited edition colors to remain unique as the brand has matured with a broad retail presence. Throughout the year, Yeti introduces limited edition colors like Cosmic Lilac and Camp Green to their line of coolers and drinkware to drive further sales of these popular premium products.
- Seasonal. Coffee chains successfully employ scarcity marketing with winter holiday drinks like the Peppermint Mocha, Gingerbread Latte, and Eggnog Latte. The seasonal flavors, festive cups, and marketing campaigns around these beverages enhance the product offering, making them highly anticipated yearly traditions for many consumers.
Any brand can use scarcity to draw attention to a particular program, product, event, or service. It takes creativity and design prowess to ignite growth by offering something unique and special for a limited time. Here are some ideas to get you started:
- Loyalty Club - Leverage those who choose to be loyal to you and offer limited-time store hours just for those customers in your loyalty program.
- Thought Leadership - invitation-only webinars, seminars, intimate Zoom calls with the CEO with limited seating/participates.
- Services - A brand might market an offering for a strategic engagement that lasts for a short duration for a price point less than the regular fee.
- Collaborations - Offer co-branded products or services that will be available for a limited time or have a limited quantity.
As you consider scarcity marketing for your business, remember that brands succeed in scarcity marketing if used in moderation throughout the year. A one-and-done approach has a limiting impact on awareness and traffic. However, an always-on LTO program can result in too much product marketing and not enough brand marketing. If you generate demand for one scarcity program, keep the strategy going. Be careful that scarcity doesn’t undercut your existing business model. For example, Yeti uses limited edition colors to “juice” demand for unique products; however, their core business model remains.