Scarcity based marketing

 

This is an English expression that is claimed to be a translation of a traditional Chinese curse. While seemingly a blessing, the expression is normally used ironically; life is better in “uninteresting times” of peace and tranquility than in “interesting” ones, which are usually times of trouble. 

Whether you like it or not we certainly live in interesting times, what with the recent pandemic and now the ‘shortages’ of certain staples of modern life such as fuel and certain foods.  The recent fuel crisis in the UK demonstrates one of the fundamental influence triggers that Dr. Robert Cialdini wrote about in his seminal book “Influence, The Psychology of Persuasion”.  Obviously, the one I’m talking about here is ‘Scarcity’. 

There is a tendency to ignore this principle as some people fail to realise just how powerful it can be.  Take the fuel crisis as an example; the very mention that there may be some minor supply problems at a few Petrol / Gas stations led to a wholesale panic by the British public, with scenes of massive queues and even some fighting as people scrambled to fill up. This was despite reassurances from Government sources who stated that there were no shortages and that people should just carry on as normal. 

The study of Human behaviour is an essential part of being a business owner/marketeer. Knowing how people will react given certain triggers allows us to predict the results we can expect. So going back to the fuel crisis, it was relatively easy to predict that given the triggers that the public were exposed to would lead to panic buying. In ‘Influence’ Cialdini proposes that there are 6 principles of influence that are hardwired into the human brain, these are:- 

1. 1. Reciprocity. The principle is that we should try to repay, in kind, what another person has provided us.
   2. Commitment and consistency. The principle is that once we have made a choice or taken a stand we will encounter personal and interpersonal pressure to behave consistently with that commitment.
   3. Social Proof. The principle is that one of the means we use to determine what is correct is to find out what people think is correct.
   4. Liking. The principle is that we prefer to say yes to the requests of someone we know and like.
   5. Authority. The principle is that once we realise that obedience to authority is mostly rewarding, it is easy to allow ourselves the convenience of automatic obedience.
   6. Scarcity. The principle is that opportunities seem more valuable to us when their availability is limited.

It’s virtually impossible for Human beings not to react to these principles, our decision-making processes are based around them, whether we like it or not.

When observing the current situation in the UK with fuel, three of these principles have come into play. The first principle was that of Authority, a leaked paper from the haulage association to government was leaked to the press suggesting that the current shortage of HGV tanker drivers could lead to shortages of petrol on the forecourts unless some actions were taken. The fact that a government spokesperson then denied that there were any problems gave the rumours more credence, not less.  

This then triggered some people to ‘fill-up’ perhaps earlier than they would have done, which led to some queues on the forecourts, which were posted on social media and in the press, triggering principle no. 3 Social proof.  People who were not, either aware of the original report nor phased by it were now convinced through social proof and the media that there were shortages, fuel was scarce (principle no.6 scarcity). Thus the whole thing became a self-fulfilling