How to Apply All Four Types of Scarcity Marketing with Mindy Weinstein (episode 422)
Mindy Weinstein PhD is the author of the brand new bestselling book ‘The Power of Scarcity: Leveraging Urgency and Demand to Influence Customer Decisions’. She’s a leading expert in digital marketing and the founder of the digital marketing firm Market MindShift.
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Writing the Book
Mindy’s PhD is in general psychology with an emphasis on technology, and as a marketing practitioner, she wanted to do research that tied the two together. She started doing work on influence and persuasion and understanding consumer motivators.
While doing her research, she came across the principle of scarcity and realized its complexity. There was a lot of information about scarcity in terms of academic research, but none for businesses. That’s when she decided to write the book and help businesses use the power of scarcity.
What is The Power of Scarcity?
The Power of Scarcity is the influence principle that can boost sales and more. When done the right way, it can influence your audience to buy your products.
There are four types of scarcity, and you can use them individually or mix them up, depending on the type of product you sell.
The Four Types of Scarcity:
1 – Time-related
This refers to some sort of time restriction. Flash sales are an example of time-related scarcity.
For flash sales, 24 to 72 hours is the ideal timeframe. You can use countdown timers in your communication, and Mindy shares that the sales of an eCommerce business selling an electronic product increased by 40% when it used countdown timers.
2 – Supply-related
Supply-related literally means there are only a certain number of units. This will create a feeling of frenzy among the customers and encourage them to make the purchase in order not to miss out.
Businesses also employ this type of tactic because they want to see how a product is going to sell before making further decisions about that item.
3 – Demand-related
Demand-related is showing your audience the number of units sold and the number of units left. This is going to make your customers feel like they need to get the item you are selling.
This type of approach speaks to people who want to conform or be part of a group and who don’t want to miss out.
Related to this, Mindy says the brain will automatically focus on products that are in demand if a person is unsure of what to buy. Adding labels such as a best seller or telling people there’s a waitlist for the product are some of the things you can do for demand-related strategies.
4 – Limited Edition
Limited editions can be done in different ways, such as limited edition bundles, product bundles, and packaging variants. You can also create them based on certain holiday events.
The thing about limited edition is that it attracts people who want to feel unique by owning something not everyone has. Just throw in something a little extra, and you already have a limited edition product.
Bonus Tip: Coupons
Mindy shares that, according to research, getting coupons creates the same feeling as being kissed. This means that anyone enjoys receiving coupons.
One way of incorporating coupons into your strategy is by giving out a coupon or reward after a certain amount of spend, that your customers can use in the future. What this does is ignite the fear of missing out and make them feel they need to use the coupon.
There are other ways of incorporating coupons into your business that you can test and adjust as you go.
eCommerce Book Top Tip
- Influence: The Psychology of Persuasion by Robert B. Cialdini
eCommerce Traffic Top Tip
- Figure out and hone in on the actual words that your audience is looking for. Capture those, provide the information your customers are looking for, and then apply the scarcity tips.
Tool Top Tip
- Asana project management software
Growth Top Tip
- Mindy’s top tip for growth is still scarcity because, for her, it’s the game changer. When you’re able to get your audience to feel a sense of urgency by applying the tips she mentioned, scarcity can really make an impact on your business.
Interview Links
Related episodes
- Turning product sell-outs to your advantage with Aaron Spivak of Hush Blankets (episode 194)
- Using Product Launches to create 200% annual growth with Chris Vallely of Dixxon Flannel Co (episode 198)
- Video Persuasion author and direct response marketing pioneer Rick Cesari (episode 245)
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