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Herd behavior and scarcity

Posted by Michael Bloch in web marketing (Thursday October 8, 2009 )

Most of us like to think we’re individuals and not sheep, but the herd mentality runs deep, often operating on a subconscious level.

Most of us who have worked an online business probably already know this, but a recent study has confirmed people are inclined to purchase a product if they are told that another item has sold out.

The study, led by Professor Paul Messinger at the University of Alberta School of Business, ran an experiment with some very interesting results.

61%t of participants said they would buy a five-hour ski pass for $20, but 91% said they would buy it when they were told a 10-hour ski pass for $40 had sold out.

The effect is known as herd behavior; where sold out-products don’t convey only urgency, but also that a product is desirable.

You can read more about the study here and learn more about using scarcity as a sales tool here.

Scarcity is a great marketing strategy – but there’s a bit of an ethical issue to be faced. If you know you can sell more of a product by saying there’s only 5 left, even if you have 500; would you still go ahead and do it? Would you put up a decoy product as a “sold out” item to direct attention to another product you have a surplus of?

It’s tempting isn’t it?

As marketers, we are quasi psychologists, often operating on pressure points such as fear and the need for acceptance in order to get bodies through the virtual door and bums on virtual seats. It’s something to think about.

The scarcity ploy is a powerful one; use it wisely – use it too often or in the wrong way and it will cease to have any effect or may arouse suspicion in your current and potential clients. Don’t spoil the efforts you’ve put into reassuring your customers – that trust is too easy to lose.


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