10X Business Letter
July 15th, 2013
San Diego, Ca
Sunny 71 Degrees
Dear 10X Business Builder,
Recently I was having a conversation with Roberto. We were discussing one of our upcoming programs and how we are going to promote it…
One of our advisors was on the call with us and suggested we use a certain scarcity strategy.
If you're not sure what "scarcity" is, let me explain.
In marketing, it is used as leverage to create leverage to sell a product or service because of the shortage of something.
Scarcity refers to any limitation placed on a product or service with the goal of increasing sales through pressure placed on the consumer. The fear of missing out causes people to make the decision to buy. The limitation can be a time based deadline or a limited quantity, often mixed with some kind of perceived benefit for acting quickly, like a reduced price, a bonus item, or an increase in status (you got in, where others missed out).
I LOVED the idea.
But, Roberto went silent.
And if you know Roberto, if he is ever silent something is WRONG!
I asked him, "Why are you so quite?"
He explained he felt that it would come off too salesy and too much like the hype-driven internet marketers.
He said, "I hate it when those guys say, 'just one seat left', 'Deadlines approaching soon', 'limited quantity', ect"…
I started laughing for two reasons.
First of all, because the way he said it reminded me of George Carlin's "Advertising Lullaby"…
…["Limited time only, though, so act now, order today, send no money, Offer good while supplies last, two to a customer, each item sold separately, Batteries not included, mileage may vary, all sales are final, Allow six weeks for delivery, some items not available, Some assembly required, some restrictions may apply."]…
My goodness was that man a comic genius. Sorry, I digressed…
And secondly because when I exclaimed, "THAT'S EXACTLY WHAT WE DO!!"
He said, "yah, but with US it's true!"
My reply was, "how does the customer know that? What makes the scarcity that we use any more authentic in the eyes of the customer than the stereo-typical hype man?"
His answer: "it's because of the trust that our list has with us. They know that we do what we say we are going to do. We have only done things that build our credibility with our clients — not destroy it."
He was right. Trust is earned and we have been earning yours for years. Actions speak louder than words and our past actions are good indicators of our future actions.
On the flip-side, I have a local furniture store that seems to be going out of business and "liquidating everything" every 6 months?!
This has been happening for years, yet they never seem to be going out of business.
That's fine and dandy in the short term, they may get some un-informed consumers (apparently a lot in San Diego), but overtime they will lose credibility in the market place. People will eventually realize that they are full of it.
But there is no debating if scarcity works.
Ebay was build on scarcity.
Apple still uses scarcity.
Infomercials still use scarcity.
Groupon is predicated on scarcity.
The reason it works is because it forces action. You can't sit on the fence if the product is disappearing tomorrow. You have to make a decision now. Humans in general like to take the easiest path of resistance. And NOT buying now or not making that decision now, is the easiest route. Scarcity to can eliminate this procrastination.
The key is to use it in an authentic way. Creating an illusion of scarcity can come off as a form of trickery. The world is a skeptical one already and once you abuse their trust and ruin your reputation, it is VERY hard to get it back.
So the challenge for you, is in your next promotion figure out how you can include some element of scarcity in your offer. Once you have come up with some ideas return to this article and post your ideas in the comments section. You may be able to help someone else.
I look forward to reading your comments.
Loving living giving large,
Publisher, The 10X Business Letter
PS – Speaking of scarcity, did you know that our signature 20 person presentation workshop, "Influencing From the Front", is sold out already for August and over 25% of the seats for the November 2013 event are already gone. So if you don't want to be left on the sidelines wondering what happened, grab your seat now (at super early bird pricing) before the price goes up or tickets are gone!