It can be easy to fall victim to “systematic thinking” when it comes to sales.
I recently came across a research paper that reminded me of the importance of questioning EVERYTHING. Even what we already believe to be true.
The reason is, people are changing. We’re becoming more sophisticated internet users, and what used to work in the past, might not work anymore.
The frightening thing is, if we don’t test our assumptions we may never discover what no longer works.
Luckily for us, a group of researchers out of the University of Kentucky tested a widely accepted marketing tactic that some might consider to be an essential element of every sales message.
Their findings discovered that the use of scarcity on an eCommerce product page had no significant impact on visitors intent to purchase a product. Scarcity was communicated by adding a message stating the number of units available.
In other words, scarcity didn’t work. It didn’t make visitors more likely to buy.
This was mildly shocking to me because of how many online retailers use scarcity. A quick browse through Amazon turns up countless product pages stating the amount of inventory currently available.
Now I know Amazon is a bit freakish about optimization, and they’re constantly running tests. They still use it, so I have good reason to believe scarcity is still effective.
But based on the research, I have to believe it’s only effective in certain situations.
If Amazon, the Goliath of eCommerce, is using scarcity, then why did the Kentucky researchers discover that scarcity had no impact? The researchers ran an additional experiment to try and answer exactly that.
What they discovered was, the visitors didn’t feel the claim was credible, therefore it had no meaningful impact on their decision to buy.
I think this leads to an interesting point.
The obvious point is: Scarcity should only be used honestly. It’s tough to fake, and if people feel they’re being deceived with fake scarcity, all credibility is shot.
But even further, in situations where scarcity is being used honestly, it needs to be used in a way that clearly communicates the legitimacy of the claim.
In other words, if you use scarcity, you need to leave no chance of it being misunderstood.
I suspect Amazon can use scarcity effectively because of the 3rd parties selling products. If the 3rd party seller didn’t have it in stock, it wouldn’t be listed on the page.
Also, there are a number of product pages on Amazon that state the item is out of stock (I’ve been eying a chromebook). This adds credibility to the other pages that state, for example, “6 available.”
This brings me to what I think is an important question.
What must accompany scarcity for it to be accepted as truth?
What do you think? What should a business do to effectively us scarcity in its online sales messages?
Jeonga, Hyun Ju, Kwonb, Kyoung-Nan (2012). The Effectiveness of Two Online Persuasion Claims: Limited Product Availability and Product Popularity. The Journal of Promotion Management, 18-1. 83-99. The Original