Why Scarcity Marketing Doesn’t Work for Every Brand


Psychology provides marketers with a tremendous amount of research and knowledge about effectively engaging customers. In fact, a lot of commonly used marketing techniques are deeply rooted in psychological functions (e.g. social proof, scarcity, anchor pricing etc.) In order to use these techniques most effectively, it’s critical to understand the psychological differences between target audiences. Psychological traits, enduring patterns of behavior, provide the context needed to understand how techniques like scarcity marketing would impact engagement for a particular audience.

We’ve all been there-- browsing travel sites for airfare to see what’s available and suddenly finding a reasonably priced flight. There’s a small notice just below the ticket price-- 2 seats remaining. You must decide: buy the ticket now or risk missing out on a great deal. This friendly reminder about the limited number of seats left on the flight is a method marketers use to encourage buying behavior based on the perception of scarcity. And airlines aren’t alone in leveraging this psychological principle; scarcity is a widespread technique across myriad industries, and brands use it in many different ways to encourage buying behavior.

But, does scarcity marketing work in all contexts? The answer, as I’m sure you’ve guessed, is no. It may be tempting to add “expiring soon!” or “sale ends today!” to your tweets or landing pages at the end of the quarter, but implementing these types of changes without measuring your audience, could actually have a negative impact on engagement. Each target audience has a unique set of motivations that drive their behavior, and by understanding these motivations, marketers can use scarcity marketing more effectively. 

What is Scarcity Marketing?

From an economic standpoint, scarcity occurs when there is low availability for a product and a high demand for it. Scarcity marketing allows marketers increase conversions by triggering concerns of scarcity .

In Robert Cialdini’s seminal work, Influence: The Psychology of Persuasion, he established six principles of influence, including scarcity, which can help drive desired behavior. A ‘scarcity mindset’ narrows the time frame in which we make choices, causing us to make bolder, short-term decisions, and potentially triggering impulsive buys.

While scarcity marketing is a great strategy for brands selling commodities or emphasizing exclusivity, scarcity doesn’t appeal to all customers. Today, smart marketers are leveraging psychological traits to understand who is most susceptible to this popular marketing technique, in order to understand the impact that scarcity marketing will have on a target segment or audience.

Psychology of Scarcity

Understanding traits can help marketers understand the specific cases in which techniques like scarcity marketing will actually be effective, rather than assuming it is a general purpose tool that will always work. Recent research from the University of Nebraska, confirms that individuals who possess certain personality traits (competitiveness, hedonic shopping motivations, and need for uniqueness) are more susceptible to scarcity marketing. 

With the added understanding of an audiences psychological traits, marketers are able to better understand if their customers will react positively (i.e. purchase or engage), or if techniques such as scarcity marketing will create stress and anxiety that cause a customer to avoid the entire experience.

The core of marketing is understanding people, and psychology is the scientific of study people and behavior. In order to maximize the potential for marketing engagement, it’s important to understand the psychology of the intended audience, and what motivates them. Measuring your target audience is a great way to understand how the principles of persuasion will impact your campaign, before introducing these techniques into your strategy. By simply understanding the psychological traits of a group of customers, marketers are in a better position to resonate with their target audience and anticipate the effect of a campaign before launching it.

Free MotiveMetrics Report