If you look at the principle of supply and demand, you’ll notice that when supply is limited, demand goes up. Scarcity has a psychological influence on us, making us want something even more if there isn’t enough to go around.
Scarcity is great because it creates a fear of shortage, and thus a sense of urgency.
Limited Time Offers
Limited time offers are among the most popular in the scarcity category. Just think about your average sofa reseller. Practically every advert or commercial is a limited time deal.
“Get 0% financing before it’s gone!”
Limited Quantity Offers
In some studies, limited quantity or supply offers have outperformed limited-time offers.
Why?
Because it’s hard to tell when an offer of limited quantity will suddenly become unavailable, while a time-based offer has a known end time. Limited quantity offers are great for not only getting people to say “yes” to your offer, but to avoid procrastination completely.
Limited Time and Limited Quantity
Groupon is the perfect example of using both tactics. All Groupon deals end within a certain time frame, and they limit the number of people who can buy a Groupon.
That’s a powerful combination.
The site also packages these scarcity tactics with discounting, which is another great value-add, especially for ecommerce businesses.
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