FOMO As A Marketing Tactic?
FOMO is inescapable, even in the marketing space! FOMO, or the fear of missing out, has made its way into marketing, and it seems as though it is here to stay. You might not be familiar with the technical term, but you've 100% heard of (or may have even taken part in) scarcity marketing.
Limited edition product drops, exclusive deals for subscribers, and countdowns to when sales are ending are all scarcity marketing tactics - the more exclusive something is, the more sought after it is! In this blog, Hollywood Branded discusses the pros and cons of scarcity marketing and shares examples of the practice.
What is Scarcity Marketing?
According to econsultancy.com, "scarcity marketing is "marketing that capitalizes on a customer’s fear of missing out on something. It’s based on the psychological principle that people want what is difficult to acquire."
While the main crux of scarcity marketing are products available only for a limited time, there are tons of aspects of scarcity marketing that affect our daily lives, without us even realizing it! Special sales surrounding holidays or significant dates for the brand are also an amazing way to utilize scarcity marketing. Whether it be a Black Friday sale, an anniversary sale, or a sale to celebrate a national holiday, limited-time deals are a surefire way to get customers ready to hunt for a good deal! In the same vein, sending out coupons with expiration dates is another great way to go after customers who are sure to never miss a money-saver!
Why Use Scarcity Marketing?
Whether or not we want to believe it, FOMO runs many people's lives. And, who can blame those people? Missing out on things, no matter how minuscule, is never fun. Because of this, it's really only natural to position your brand and explore ways that your brand can capitalize on this notion. The tactic, while by no means new, is something that is constantly changing and evolving. The ways that scarcity marketing take place may change, but the reasons will always stay the same!
The tactic, when used to sell a specific product, positions the product as a commodity, making consumers feel like they have to have the product or they'll miss out. While what they're missing out on might not be entirely clear (even to the consumer), the practice nevertheless ensures that consumers who want to always be ahead of the hottest trends will take full advantage of the limited-time product drop. The tactic also gives your brand the opportunity to market yourself in a completely unique way - you have the ability to "rebrand" yourself for a short amount of time, and if it doesn't work out the way you want, it doesn't have to be something long-term! Through scarcity marketing, you have the ability to create a completely new brand with little stock behind it - get creative with it!
- It allows you to sell products and services in large quantities within a short time frame if your services and/ or products add good quality and value to the customers.
Examples of Scarcity Marketing
Booking.com is notorious for its scarcity marketing tactics. While they're a company that will always have customers (even with Airbnb and VRBO, hotels don't seem to be going anywhere!), they have employed scarcity marketing in a very sly way. By showcasing how many people are looking at the property while you look at it, as well as showing how many people have booked a stay there at a given time, it creates a sense of urgency with the consumer. If four other people are looking at the property, that must mean that space is limited and that this is a highly sought-after location! This sense of urgency instilled in consumers helps brands make quicker sales than if the listing just showed the bare bones of how much the room costs, where it is located, and what the average review is.
While Bumble is a primarily free dating app, they still utilize scarcity marketing! By giving women 24 hours to message a match (or lose access to that match), it creates a sense of urgency with the user. However, if someone lets the match run out accidentally, Bumble gives users the option to re-match or extend a match with someone, for a small fee! Users can purchase a premium Bumble account for $16.99/month for unlimited re-matches, extensions, and Super Matches, and also gives users the ability to see who has liked them prior to swiping through users. For $8.99/week, users can have the ability to re-match and extend matches.
Starbucks has mastered the art of scarcity marketing. Year after year, Starbucks fans count down to the introduction of their seasonal beverages, and patiently wait to see if any new additions are made to the seasonal menu. While Starbucks is sure to never stray away from the tried and true fan favorites, Starbucks takes the holiday seasons as a time to try new flavors, as well. This year, they're adding the Apple Crisp Machiatto to their fall menu, and are likely to add a new holiday-inspired flavor to their winter menu. On top of the fun coffee flavors, Starbucks also rolls out limited-edition cups during the holiday season, to really let the season ring!
Glossier Pop Up Shop
While all pop-up shops are a tried and true way to employ scarcity marketing, Glossier has done it in a way that creates an entire event out of shopping! The ultra-aesthetically pleasing nature of the brand lends to an easy way to create a stunning shop - which is exactly what the brand did! Throughout 2018 and 2019, the brand took its online-only shop to the streets of New York, Portland, San Francisco, and Los Angeles, to create a limited-time in-store experience. There, customers could try out the products previously only available online, while also having the ability to snap some stunning IG photos in the storefront built for social media. This gave the brand a way to not only reach new customers via an in-person store, but it also gave them a way to get free social media marketing via fans of the brand!
Supreme is the blueprint when it comes to scarcity marketing - their entire business model is based on the practice! While the brand now has some items that can be purchased year-round, Supreme has specialized in limited-edition drops of everything in their catalog. From sweatshirts to skateboards to even toothpaste, everything that the brand drops is highly sought-after and sells out within minutes.
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