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Choice Restriction: Scarcity

Let’s start with one of the most common persuasion strategies used by marketers today. Researchers call it “choice restriction”… and you can do it a couple of different ways. In this segment we’re going to focus on choice restriction that results in scarcity.

Humans tend to place a lot of value on things that are scarce. Historically gold is more valuable than lead or tin, because it was far more rare. Diamonds are also considered valuable because they’re not readily available everywhere. And the supply of diamonds is restricted by a cartel that helps preserve their scarcity.

Scarcity increases the value of collectibles like coins, stamps, comic books, beanie babies, Barbies, McDonald toys from the 90s, and baseball cards. The less available one of these items is, the more valuable it is.

Why does choice restriction work as a way to persuade people to take action?

One theory is that humans have evolved in an environment where resources were almost always scarce. Famine and drought were common. Opportunities for food, shelter, and mates would come and go quickly. 

Once opportunities were gone, they were often gone for good. If you failed to act fast, you would go hungry. Or lose a mate. Or a child. Or worse.

“Anticipated regret” or FOMO the “fear of missing out” triggers a response in the amygdala—the part of the brain where we process fear and where the fight or flight response is centered. Suddenly not acting on an opportunity feels like a threat to your existence.

And just a few millennia ago it was.

The fear of missing out elevates opportunities to the top of our consciousness. It’s as if our System 1 brain is shouting… time is running out! paying attention to this now or you’ll lose it forever.  Even if we logically know we won’t lose it forever.

When we feel like we’ll lose access to something we’ve previously had, or something we now have, it triggers what researchers call “psychological reactance”. That is, we react against whatever is taking this opportunity away from us.

So when prospects believe that a product might not be available in the future, they are incentivized to get it now.

Another name for this is the “Romeo and Juliet Effect”. Remember that Romeo and Juliet were forbidden by their parents to spend any time together, and the effect was to make time together even more desirable. 

The Romeo and Juliet Effect makes forbidden or dangerous items like cigarettes and drugs more attractive. Its responsible for more bad teen age behavior than just about anything else.

In the copywriting world, we’ll occasionally see a promotion with words like, “The government doesn’t want you to see this”… or “What is the pharmaceutical industry hiding?” We’re immediately inclined to want this forbidden information.

The sports world got a sense of how FOMO worked when David Beckham joined the LA Galaxy. While Becks had been playing in the UK for years, the opportunity to see him play in the U.S. was rare.

As the Galaxy traveled to games around the country, ticket sales increased significantly as fans jumped at the possibly once-in-a-lifetime opportunity to see Beckham play.

The effect on ticket sales was so dramatic that researchers called this “the Beckham Effect”.

And choice restriction is why I traveled to DC as a kid to watch Michael Jordan play for the Wizards. Michael had already retired from basketball once, and he was sure to retire again soon. Seeing MJ play in real life was a rare, once of a lifetime, opportunity. 

When Apple began its expansion into retail stores, the brand’s fans would line up for hours—sometimes days—just to be one of the first fifty or one hundred people in the door. 

Why? Because Apple would give away limited-edition t-shirts to those first lucky customers.

Even when there were no new products to announce or sell… fans still lined up.

When Apple opened its first store in Salt Lake City I was one of those people. I got my t-shirt. It’s still in my closet, un-worn. I didn’t really need it or want it, until the opportunity to never have it again came along. Then it became a must-have item.

We also saw scarcity at work during the early weeks of the Covid pandemic as toilet paper was suddenly gone from store shelves. There was no logical reason for this except that everyone else was buying up toilet paper… making it rare and more valuable.

The more people who bought it, the more scarce it became, triggering even more people to buy it, until it was gone.

And of course copywriters have been using this tactic to increase sales of their products for decades. 

Grand opening sales offer the opportunity to buy products at a price only available when the store opens. A few days later, prices go up. So you have to act now.

Final close out sales offer the opportunity to purchase products before a store closes and they’ll no longer be available at all. Act now or miss out.

Holiday sales, Black Friday sales, Annual Sales Events… all do the same thing—trigger the fear that if we don’t act now, we’ll miss the opportunity to get this valuable thing.

Check out how Amazon uses this tactic to sell LG computers.

They say there are only 10 left in stock. And with as many customers as Amazon has, the implication is they won’t last long… you have to buy now.

Delta does something similar. I recently looked at flights to Washington DC and was told that basic seats were no longer available and the more expensive seats were almost gone too.

Just one left at this price. Again, the message is clear… these are almost gone and I’m going to miss out if I don’t hurry and act now.

Let’s take a look at how copywriters have used this strategy in their sales messages.

Here’s a P.S. for a long-from sales letter that sold a newsletter that teaches investors how to make money shorting stocks. There’s no specific deadline to increase urgency, but the copy gives a believable reason why this offer will not be available soon. It says…

Here’s similar example from a promotion for The Big Idea book by Todd Brown. Like the PS we just shared, it doesn’t have a specific deadline, but he does give a believable reason why this offer may become scarce in the future… it’s a test. Here’s what it says…

This next example for Doberman Dan’s coaching offer is a great example of scarcity. Because Dan’s time is limited to 24 hours a day, he only has time to work with a few clients one-on-one. This is good copy and a great example of the scarcity principle:

He starts with five. And later came back to update the sales page when only one spot is left. If you were thinking about taking Dan up on this offer, you need to move now to get in.

This is the exact tactic that worked on me when I joined the mastermind where Kira and I met. It started with 16 spots. Once they started to disappear, I knew I wanted one of the remaining seats in the mastermind. So I stopped hesitating and thinking and took action. It was one of the best career decisions I’ve ever made.

By the way… scarcity is one reason why choosing a niche as a copywriter helps you attract better clients and higher project fees. By specializing in a particular niche, you become one of the few people… or possibly, the only person with your skill set. 

You make yourself a market rarity. And clients place a higher value on that than on working with a generalist.

It’s important to note that this tactic does not work when the consumer can see that the scarcity is not real. If it’s obvious that you’re just making it up… that the offer will still be available or that you’re manipulating your prospects, it can backfire.

Like this email I recently fot for an ebook provider.

The Subject Line reads: Nonfiction Overstock: So Many Great Titles We Need Another Sale. 

The only problem is that you can’t overstock ebooks. They don’t take up space. It’s blatantly obvious that this scarcity is manufactured. I know the marketer is trying to manipulate me and it destroys any trust I might have for the brand. Don’t do this.

Persuasion works, but treating people like they’re fools does not. That’s why we *eyeroll* whenever we see another webinar registration page that highlights there are only 50 spots available. I mean, come on. 

We all know that most marketers hosting webinars will gladly upgrade their account to hold more attendees if their registration numbers shoot up. So don’t make up bogus scarcity statements just because you can. It destroys trust and kills sales.

In the next segment we’ll talk about a second way to use choice restriction in your copy. See you there.

References:
Timothy DeSchriver, “The Beckham Effect: examining the longitudinal impact of a star performer on league marketing, novelty, and scarcity”, European Sport Management Quarterly, Vol 17, 2017.