Scarcity is one of the most influential psychological principles in sales.

Robert Cialdini's research in Influence: Science & Practice, explains that scarcity operates on the fundamental human tendency to desire what is perceived as rare or in limited supply.

When used strategically, this principle can significantly boost a salesperson's ability to close deals, increase demand, and create a sense of urgency.

This article explores how salespeople can effectively harness the power of scarcity in their sales strategies.

WHAT IS SCARCITY?

Scarcity is the idea that people place higher value on items that are perceived to be limited in availability.

Cialdini’s research shows that when something is rare or difficult to obtain, people are more likely to desire it. In sales, this principle can be applied by creating the perception that a product or service (or attention) is in short supply, making customers act quickly before they lose the opportunity.

This psychological response is rooted in the fear of missing out (FOMO), which compels people to act when they believe they may not have access to an opportunity again.

It works emotionally and psychologically even when we are aware of our tendency to respond to FOMO.

By leveraging scarcity, salespeople can increase the perceived value of their offering and motivate customers to make a purchase before it's too late.

THE PSYCHOLOGY BEHIND SCARCITY

The scarcity principle works because of two key psychological factors: loss aversion and social proof.

Loss aversion: People generally fear losing something more than they value gaining it. The idea of missing out on a limited product or deal triggers this fear, motivating customers to act quickly to avoid regret.

Social proof: When people see others vying for a limited product or service, they are more likely to want it themselves. Scarcity often brings a sense of competition, making customers feel they need to act before others do.

By understanding these psychological drivers, salespeople can craft messages that tap into these fears and desires, leading to higher engagement and conversions.

CREATING URGENCY THROUGH LIMITED TIME OFFERS

One of the most common ways to use scarcity in sales is through limited-time offers. These promotions create a sense of urgency, compelling customers to make a decision quickly. Limited-time offers can take many forms:

Flash sales: Offering a significant discount or bonus for a very short period (e.g., 24 hours) encourages quick action from customers who don’t want to miss the deal.

Seasonal promotions: Highlighting products or services that are only available during certain seasons or dates reinforces the idea that the opportunity is fleeting.

Countdown timers: Including a countdown timer on a website or email campaign makes the limited-time aspect tangible, adding to the urgency.

These types of offers create a deadline that motivates customers to act before the opportunity disappears, increasing the likelihood of immediate sales.

SCARCITY THROUGH LIMITED AVAILABILITY

Another effective strategy is to emphasise the limited availability of a product or service. When customers are led to believe that a product is in short supply, they are more likely to rush to purchase it before it sells out.

This can be communicated in several ways:

Low stock alerts: Informing customers that only a few units are left in stock can create a sense of urgency, encouraging them to buy before it’s too late.

Exclusive releases: Promoting an exclusive or limited-edition product can make it appear more valuable and desirable, increasing its appeal.

Pre-order availability: Offering pre-orders for a limited number of items can build anticipation and scarcity, pushing customers to secure their purchase in advance.

By creating the illusion of scarcity, salespeople can tap into customers’ fear of missing out, prompting them to take action sooner rather than later.

SOCIAL PROOF AND SCARCITY

Social proof is a psychological concept where people tend to follow the actions of others, especially in uncertain situations.

When it comes to scarcity, social proof can significantly enhance its power.

Seeing that others are interested in or purchasing a limited product can drive a sense of urgency and competition.

Salespeople can use social proof in scarcity by:

Displaying real-time purchases: Showing customers that others are buying the same product in real time (e.g., "3 people are looking at this product right now") can make the product feel more sought after.

Highlighting popularity: Noting that a product is “selling out fast” or “one of our bestsellers” can create the perception that many people are interested in it, making the customer want to act quickly to avoid missing out.

Customer testimonials: Featuring reviews or testimonials about how popular a product is or how quickly it sells out can reinforce the idea that the item is desirable and scarce.

Using these techniques helps amplify scarcity by showing customers that others are vying for the same product, which increases their desire to own it.

SCARCITY & EXCLUSIVITY

Exclusivity is another powerful form of scarcity. When a product or service is presented as being exclusive or reserved for a select few, it enhances its perceived value and makes it more desirable. Salespeople can create exclusivity in several ways:

VIP access: Offering early or exclusive access to products for loyal customers or members can make them feel special and motivated to act quickly.

Invitation-only offers: Making a product or service available only to certain customers (e.g., by invitation or through a private sale) can make it more coveted.

Limited editions: Products that are part of a limited edition or carry a unique feature (e.g., a numbered item) can be marketed as scarce and highly desirable.

Exclusivity taps into customers' desire to feel like they are part of an elite group, which can spur them to make a purchase before the opportunity slips away.

Incidentally, your time and attention is also in limited supply! Make yourself less available rather than bending over backward and being available easily 24/7.

Being too available diminished your authority, credibility and status. As well as making yourself less scarce of course!

USING SCARCITY TO OVERCOME OBJECTIONS

Scarcity can also help overcome objections during the sales process. When a customer hesitates due to price or need, highlighting that a product is in limited supply can push them to take action.

For example, if a customer is on the fence about making a purchase, a salesperson might say, “We only have a few left in stock, and I don’t want you to miss out on this opportunity.” This creates a sense of urgency that can prompt the customer to finalise their decision.

Similarly, when a salesperson is faced with objections about the value of a product, they can emphasise its limited availability, positioning it as a more valuable and desirable item due to its scarcity.

WARNING NOTE!

It’s essential to use this principle ethically, ensuring that the scarcity you promote is genuine.

When used correctly, scarcity not only boosts sales but also enhances the perceived value of your offerings, creating lasting customer engagement.

For example, a client of mine in the water industry was recently acquired by a competitor. They contacted all of their clients and explained that the products which were duplicated would be increasing in price dramatically in two months time, which was true.

The pitch was an obvious one - you're buying these products already, and you're going to continue buying them, so why not bulk order before the price increase so you have everything locked in?

​The result was nearly a year's worth of business in eight weeks. Just because of honestly using scarcity.