Are You Making the Most of Scarcity as a Marketing Strategy?

by Colin Shaw on September 6, 2018

Scarcity as a marketing tactic is one that works well with customers. However, it is one that many marketers don’t use to their advantage often enough. If you are one of them (and you don’t act now), avoiding scarcity tactics can hurt your bottom line.

For our recent podcast we invited a special guest to join us. Professor of Marketing at Vanderbilt University, Kelly Goldsmith, Ph.D., is a behavioral scientist who studies how we respond to uncertainty and scarcity as consumers. Goldsmith shared her definition of scarcity with our listeners:

“Resource scarcity involves sensing or observing a discrepancy between one’s current level of resources and a higher and more desirable reference point.”

Goldsmith explains that when you are experiencing scarcity, you are not where you want to be concerning your resources, like money, time, or availability of a product to name a few. She says scarcity is associated with losses for us psychologically; i.e., you don’t feel you have enough of whatever it is you want. These feelings drive some of our behavior as customers.

Goldsmith says the effect of scarcity on our behavior is it makes us more competitive. A recent scientific study confirmed it. Participants were shown videos of marketing messages using scarcity tactics and then played video games afterward. The group that watched the scarcity messages were more aggressive in the game than those who weren’t. Goldsmith says that scarcity gives people the sense that there is a limited amount of pie and you have to make sure you get yours first.

It reminds me of the Black Friday behavior you see when people hurtle through the doors. Consider this Black Friday video taken outside Urban Outfitters in 2011:


Scarcity as a Marketing Tactic

Within a consumer realm, there are lots of different ways you experience scarcity. Marketers use scarcity all the time in their messages. You probably heard some scarcity messages today using scarcity as a strategy, like commercials or ads that include the words, ‘for a limited time’ or ‘while supplies last’. These phrases create a sense of urgency in the mind of the consumer. Goldsmith says another way scarcity occurs in the consumer realm is when the shelves look empty at a store like they do when there is severe weather or a transportation strike. Another example of scarcity as a consumer is when there isn’t a large variety of a product available or your local store doesn’t stock more than one or two versions of a product.

The product or service does not have to be hard to get to create scarcity, however. An excellent example of scarcity in marketing of something that isn’t scarce is the McRib sandwich at McDonald’s. The McDonald’s McRib sandwich is a pork sandwich served with barbeque sauce, pickles, and onions on a roll. Although the meat patty has ridges made to look like rib bones, there are no rib bones in the sandwich—or rib meat. Per Wikipedia, the McRib is made of pork shoulder meat.

The sandwich debuted in 1981, but was removed from the menu in 1985 due to ‘poor sales’. Four years later after pulling the pork sandwich (pun intended, thank you), McDonald’s reintroduced it. However, this time they decided to add these six words to the marketing message, ‘But for only a limited time’!

Mc Donald’s McRib Time – It’s Back (but only for a limited time!) 1989


So, scarcity helped bring back a product scrapped because of poor performance. Of course, we know that it is still coming back over 30 years later. But only for a limited time. (Except in Germany where the McRib Sandwich is always available. Sehr gut!)

Scarcity Brings Out Our Desire to Be the Best

Marketers can adapt their messages to take advantage of scarcity’s influence on us in their marketing messages. Goldsmith says the competitive nature that scarcity brings out in us, draws us to products positioned around the self-benefits they offer us. In other words, products that give us a competitive edge.

Goldsmith did an experiment that tested the perceived value of Post-it® Notes through a scarcity lens. Goldsmith and her team had two groups of participants. The participants wrote either about a time when they didn’t have enough of a particular resource or what they did that week so far. Then, researchers showed the two groups Post-It Notes, an unassuming product. However, one of the groups was given a message about the Post-Its with a self-benefit message, ‘Sticky Notes for Effective Knowledge Retention! The Secret Weapon of Those Wishing to Improve’. The others only saw the label, ‘Post-It Notes’, meaning there was no self-benefit message given.

Goldsmith found people who had written about a time when they didn’t have enough of something were willing to pay 74 cents for the secret-weapon Post-It Notes. Those who hadn’t written about that were only willing to pay 42 cents.

What we can learn here is that scarcity brings out our competitive side. Positioning your product to help customers be as competitive as possible is the best way to get them to want your product or service.

Scarcity Strategies Target Customers Emotions that Lead to Short-Term Spends

In the Emotional Signature research we do for our global customer experience consultancy, scarcity would drive the emotions in the Attention Category:

As you can see, these emotions are bracketed with the feelings that influence buying decisions in the short-term. It’s up to you what you do with customers from there. After all, if your product delivers on the promise you made, you have an opportunity to move the customers up the pyramid to the gold-standard of customer emotional engagement in the Advocacy cluster, Happy and Pleased.

It probably wouldn’t work with the Post-It Notes customers that spent 32 cents more on a product that didn’t have any Secret Weapon power. However, provided you deliver on the promise you make with your brand, you have an excellent chance of success.

Scarcity is a marketing tactic because it works. It creates the sense that we need something (even if we don’t) and makes us feel pressure to get it before it’s gone (even if it won’t be).

Products that use these feelings and then position how they can benefit the customer will be successful in gaining the attention of their customers and getting them to buy. However, the Customer Experience must live up to the promises of the marketing, or the only scarcity a brand might be feeling is a dearth of repeat business and the profits that come with them.

Follow Colin Shaw on Twitter @ColinShaw_CX

Colin ShawAre You Making the Most of Scarcity as a Marketing Strategy?