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Verknappung
Verknappung

Scarcity and its forms of application

”Hurry while supplies last“, ”Only 5 seats left at this price“, “90% of accommodation in Munich for your dates are already booked”

Does this sound familiar to you? Certainly, you have already come across such slogans. In all likelihood, your fingertips have already been twitching from time to time, so that you either ended up buying the product – or at least you we’re close.

In social psychology, this pattern is referred to as artificial scarcity. Also known by the term scarcity principle, it belongs to the best-known behavioral patterns used in e-commerce to intentionally direct the user or to move him or her to action. Thereby, this strategy does not necessarily imply a pure negative or manipulative intention, but a sense of information and rising sales, since scarcity fuels desire.

The scarcity principle is based on the idea that from a customer’s point of view, a product’s value increases as soon as it’s time or number availability become limited – true to the motto: Prices are determined by supply and demand.

How to use the scarcity principle online

In the online sector, three different forms of scarcity can be differentiated:

  1. Scarcity of time / temporal limitation
  2. Scarcity of stock
  3. Scarcity due to limited access

1)      Scarcity of time / temporal limitation

In terms of temporal limitation, a distinction is made between a concrete deadline (“The offer ends in 15 minutes”) and a vague statement (“The offer ends soon”).

Once a certain time frame for a specific offer is announced, users are subconsciously encouraged to take action to purchase the product before time is running out. If no specific deadline is determined, a form of uncertainty arises, implicating only immediate action can ensure the product is still available to the conditions exhibited.

Here are a few practical examples:

Example: An online provider’s course occupancy rate (Interaction Design Foundation)

The course provider clearly states how long the user can still enroll in a chosen course before the registration is closed. Fully booked courses are still displayed to show what the user already missed out and to give him or her the chance to attend next time.

Example: Premium offer at Sleep Cycle

The app Sleep Cycle relies on a well-functioning combination of price reduction, communication of a premium product (highlighting the savings in percent + comparison old / new price) and a clear deadline.

2)      Scarcity of stock

E-commerce shop systems offer online retailers the opportunity to communicate the scarcity of inventory directly (in real time) to the shop visitors. Informing the customer, the selected product is only available in a limited number, leads to a subjectively perceived increase in value.

Example: booking.com

Booking.com relies on an elaborated application of the scarcity principle. The booking portal’s visitor is clearly informed about the demand (number of people which have been looking at the accommodation recently) and how many rooms are available.

3)      Scarcity due to limited access

This form or scarcity refers to an offer’s limited access such as information or inventory, which are, for example, only communicated or given to premium members. Research has shown that people attribute higher value to products whose access is limited compared to products which are freely accessible. Limited access can result in a sense of exclusivity of the offer.

Example: Fabletics

Fablectics promotes its affordable leggings through a variety of online and social media channels. However, leggings can only be acquired by VIP-members to motivate users to get a membership.

Conclusion

Some time ago, we already discussed Dark Patterns and their negative impact on user experience. Likewise, for some readers the current article might has evoked feelings of manipulation. However, that is not the case. In fact, usage of the scarcity principle can have a positive influence on the user flow, if it emphasizes user-relevant information or if it informs interested users their action is required sooner than later.

Here are some guidelines how to use the principle of scarcity properly:

  • Use the pattern for products that are known to be available only for a limited amount of time or for a limited number of pieces (e.g. accommodation, products)
  • Communicate your inventory volume truthfully.  If users realize nothing has changed since their last visit, it can have a negative impact on their user experience.
  • Show realistic numbers. An artificial scarcity provokes mistrust in the long run.
  • Make your information as transparent as possible by dynamically adjust to user transactions to show the offer is diminishing.
  • Provide a clear framework (duration of the offer, exact quantities) so that customers can estimate how much time they still have to make a purchase decision.

Michael Wörmann

Dörte Maasch

Dörte is a consultant at Facit Digital and specializes in qualitative methods. It is important to her to get the user on board as early as possible in order to achieve the optimal user experience