The key to selling is closer than you think; it lies in the customer’s fear of missing out.
Why are we afraid of missing out And how does this apply in retail situations?
Fear of missing out isn’t just a buzzword. It has its roots in the early days of man, when we were reliant on what we could scavenge and hunt for sustenance.
In days when food was plentiful, we would feast, loading our bodies with calories to help to deal with times when food would be scarce. So when we were cavemen, we were afraid of famine. But now we re 21st century consumers, the scope of what is considered necessary has widened. This has made us just as afraid of lack of choice as we are of lack of products. Because of this, when we are confronted with the potential of missing out, we switch to caveman mode, making us far more likely to buy.
This is more likely if there is popular demand for the product. The higher quality a product is, the more people want it ergo, a product that is popular must be high quality. So by demonstrating that your product is popular you can increase the likelihood of them being bought.
eBay makes shoppers feel like winners
Scarcity and pressure techniques make eBay an effective selling site. Most bidding items are sold individually, adding extra pressure as when the item is gone, you don’t know when another will turn up. It pitches bidders against one another, gamifying the sales technique with the use of words like ?winning” and ?losing?. By adding tension to the sale with a countdown on live bids, eBay puts its bidders into a heightened state.
Starbucks has made itself one of the key flavours of autumn
It” terms of the time of year Autumn, for many people, the season has one key flavour: Pumpkin Spice. But why is this” Starbucks have flavoured Autumn by putting a flavour on limited release between October and December. Shoppers who are fans of Pumpkin Spice but not other Starbucks beverages are more likely to come into the store during Autumn. This is because they are making the most of the flavour before it goes away in the new year.
ASOS shows its emptying shelf to pressure shoppers into buying
ASOS is a popular retailer for clothes and frequently holds sales. While frequent sales can devalue your products (why buy something for £50 now when it will be £15 in a month?), the rapidly diminishing quantity of each item helps to pressure shoppers into buying. By greying out sizes that are no longer available, ASOS can even persuade shoppers to buy clothes that may not fit.
Continue reading to find out the risks and benefits of scarcity techniques.
There are risks and benefits to scarcity techniques
Scarcity techniques work in two ways. The first, when the products are scarce, relies on audiences being invested in the idea of owning your product. This means that they will be distressed at the idea of no longer being able to. If the offer is for a limited time, they rely on the offer being ‘too good to refuse’.
Limited time offers give you the chance to boost sales during quiet periods. Shoppers will often wait until the last second to buy if there is no chance of the product selling out (eBooks, for example). They will feel more pressure to buy sooner if there is also a countdown of product quantity.
Limited quantity sales are suitable for items of which there are a finite quantity. Whether finite means five or several thousand is dependent on the product and the audience. Finite quantity sales can create a higher customer buzz, but the sales system needs to be capable of handling the sales traffic. Once an item is in the basket, it is perceived as already theirs. If they are then told the item is no longer available, it feels like the item has been stolen from them.
Seasonal specials, much like Starbucks, can create customers who visit specifically at that time of year for that one product. It can, however, cause issues; customers will be distressed and make complaints if the product isn’t available.
Seasonal sales can clear out old stock in time for the new season and provide a boost at a low spending time, such as the new year. However, this can cause frustration both online and in-store. Online, if your systems aren?t up to scratch, customers could find that products they have in their basket are no longer in stock by the time they get to the checkout. In-store, customers may spend time searching through a sale rail only to miss out on the products they want, because the size isn’t in stock.
If you are thinking of applying scarcity techniques to your stock, think about the effects ? positive and negative ? that it could have on your buyers.
Phillip Adcock is the founder and managing director of the shopper research agency Shopping Behaviour Xplained, an organisation using research into retail shopper behaviour to explain and predict what your customers do. SBXL operates in 17 countries for hundreds of clients including Mars, Tesco and B&Q.
It’s no secret that marketing tricks exist to seduce you into spending more than you intended, but with every part of a store fashioned to make you purchase more goods, it’s no wonder we often fall into their traps.
