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November 28, 2021
Conversion rate optimization is deeper than simply rearranging your home page and tweaking button colors. Smart marketers use psychology and a keen understanding of customer behavior to entice shoppers to make purchases.
Scarcity and urgency are two powerful psychological tools marketers can use to boost their ecommerce conversions. In this article, we’re going to explain the two concepts and offer some strategies to take advantage of each.
Urgency is when a buyer feels like they need to take action quickly. It's when they feel that something is so important that they need to respond right away in order to take advantage of it or to minimize the pain of not taking advantage of it.
A key part of urgency is importance. In order for something to be urgent, it must first be important. It’s all about importance. If your products are perceived as important, potential buyers will be more inclined to respond to urgency.
Imagine a salesman trying to sell sunscreen at an ice skating rink. It’s not important in that context, so you can’t use urgency to sell it. But sunscreen is very important at the beach, so you could use urgency to squeak out some more sales.
Time is another important factor. You want the conversion now so you have to give your customers a reason why buying now is preferable to buying later. If you can’t make that argument, your customers will hold off.
Scarcity refers to a limitation on your products that makes the customer feel the urge to buy now or miss out. Just like urgency, scarcity eliminates procrastination and compels action. If they wait too long, there won’t be any left to buy.
Scarcity is an interesting concept because it seems to affect how people feel about products. When there is plenty of something, people don't find it valuable. But when supply is low, suddenly everyone wants it.
Scarcity is a tricky concept for some marketers to get right. It’s only useful when there’s a genuine limitation on whatever you’re selling. If you try to create artificial limitations, your customers will catch on quickly.
For instance, let’s say you design a custom T-shirt for New Year’s Eve. You make 300 shirts and won’t make any more, since you know you won’t sell any after the New Year. You could honestly tell your audience, “Only 300 available! Order before they run out!”
Clothing stores do this all the time with last year’s styles. When those products are gone, they are gone, so there is a very real scarcity component. A subscription box product may sell past boxes, but only until that inventory sells through, then there aren’t any more.
On the other hand, some stores do it wrong by trying to create scarcity when there isn’t any. Some furniture stores are constantly “liquidating all of their stock.” You’ve probably heard of car dealerships offering low prices because they “bought too much inventory.” Some retailers even try to impose scarcity of digital products.
As you can imagine, urgency and scarcity are closely related. They often overlap.
How you leverage scarcity and urgency depends on the product, your offer, and your audience. What works for one audience won’t work on all of them.
For instance, suppose you are hosting a back-to-school sale. School supplies are important because kids need them to perform well in school. But a back-to-school sale will only matter to parents and students old enough to buy their own supplies. Someone who doesn't have any children and doesn't attend school won’t find your sale important at all.
So while what works for one store may not work for another, here are some strategies you could use to try to take advantage of these psychological concepts:
Use clever copywriting techniques to convince your customers that now is the best time to buy. Leverage their innate fear of missing out. Show them that they will actually lose something or suffer in some way if they don’t buy now. Words like “hurry,” “now,” “limited,” “immediately,” “today only,” and “instant” do have an effect on people.
Furthermore, add deadlines into your copy. There needs to be a point where your offer is no longer available. Here are some simple examples:
Countdowns can be used to count down the amount of time left on something. Amazon uses this tactic well. In some cases they use a countdown timer to let you know how long before the deal is no longer available.
In other cases they urge you to order quickly by offering to deliver it the next day.
Countdowns can also be used to inform the shopper how much stock is left. Simply adding “Only 6 left!” next to one of your products can spur people to buy. Just make sure you’re being honest. If you have a stock countdown running every day, people will notice.
Disney is known for this, but it works for other brands as well. You can create hype for products by strategically making them unavailable for periods of time. Eventually, once customers begin clamoring for the chance to buy, you can release limited runs. Once you’ve sold through, return the product to the vault until hype grows again.
That said, be careful with this tactic. It only works for products that are highly sought-after. But if people love them enough, it might make more financial sense to make them available all the time. You'll have to experiment to determine if this method is right for your products.
If something isn’t available to purchase, don’t hide it from your site. Just mark it unavailable. This makes customers think that other products are scarce as well. For instance, if a size isn’t available, Asos doesn’t remove the option, they just make it unclickable.
Furthermore, it also helps to include a CTA to notify when available. For instance, you might ask for their email address to receive a notification when stock is available.
Holiday sales are a tried-and-tested way to boost sales because 1) they come with a built-in time limit, and 2) people already have a reason to buy.
Generally speaking, holiday sales for gift-giving holidays start before the holiday and end on it. For instance, Christmas sales often start after Thanksgiving. Non-gift-giving holidays usually occur on the holiday itself or just around it. A Memorial Day sale, for example, is usually only held on Memorial Day or the weekend around it.
A special edition is a premium version of a product that only die-hard fans will buy. It usually comes with several perks, like bonus items or upgraded materials. You can call them “anniversary editions, “collector’s editions,” “limited editions,” or anything that signifies a variance from the original product. But special editions only work if there’s a limited number of them.
Apparel brand Supreme takes this to the next level. Every item is a special edition. Once it’s sold out, there aren’t any more of them. Customers rush to buy new products, fearing that they’ll miss out on the next cool style.
Create a steady stream of scarcity by grouping outgoing products together into their own collection. Promote this collection regularly so your audience checks it often. Just make sure products in this category actually leave at some point, or your customers will feel misled.
Don’t be afraid to tell your customers how badly your other customers want your products. Notice how this store leverages urgency, scarcity, and social proof all in one:
When it comes to scarcity tactics to market your products or services, try not to overdo it. If customers think you’re trying to manipulate them, they won’t just refuse to buy - they will share their opinion loudly. Make sure you’re being honest whenever you press on your customers’ feelings of urgency or scarcity.
Also, be sure to check out the Nudgify app which has some scarcity and urgency features that you can easily add to your Shopify store.
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