Steve Wagenheim’s Home Business Blog Everything You’ll Need To Run A Successful Home Business
  • Oct
    23

    I have no doubt that this article is going to raise quite a few eyebrows. The subject today is scarcity, or as I now refer to it, scare city. I’m going to try to look at this issue as logically and as impartially as possible. Given that I am an Internet marketer, that my be difficult to do. But I’m sure going to try my best. There may be some radical ideas in this piece so consider yourself warned.

    Okay, so what exactly IS scarcity? Well, it’s when you sell a product and there is only so much of it being sold to the point where it’s scarce. Some products are more scarce than others. Have you ever tried to get your hands on one of those “numbered 1 to 20″ baseball card collectibles? Some of them are going for some pretty outrageous amounts. That is REAL scarcity.

    But in the Internet marketing world, we have another kind of scarcity that a lot of people complain about. I’m referring to the “Only 50 copies of this e-book will be sold” kind of scarcity. Everybody knows that, with an e-book, you can sell as many copies as you want and they NEVER run out. Right? So how can you have scarcity that is REAL with an e-book?

    I’m glad you asked that question because a lot of people get all up in arms when they see a sales page that says only 50 copies of an e-book will be sold. They immediately cry “scam” and start bashing the seller as if he was the most evil vile creature on the planet. Well, I have a news flash for you.

    I sell items with scarcity. In fact, most of my latest products have been sold using scarcity. And they’re all ebooks or digital products. I guess that makes me an evil monster too. I suggest you stop reading this article right now or you might get contaminated by my evilness.

    Where is Dr. Horrible when you need him?

    All kidding aside, I am NOT the devil in disguise. I am going to explain why scarcity not only works but why, even with digital products, it is a valid, legal and ethical practice. You might want to pay attention to this if you want to become a better marketers.

    Let’s start with why it works. That part is easy. It works because when a prospect sees that a certain item is being sold in a limited quantity, they don’t want to miss out. Fear of loss is a terrible thing. So they dig into their wallets and buy the item BEFORE it’s sold out. Scarcity creates more sales. That’s all there is to it.

    Now let’s move onto why it’s valid, legal and even ethical. Yes, it’s the ethics of, what people call, “false scarcity” that ticks them off. So I will explain why this so called “false scarcity” is perfectly ethical. But first, let’s start with why it’s valid.

    It’s valid because it works. If it didn’t work, it wouldn’t be a valid practice. There would be no point in doing it. In fact, if you could sell more units without scarcity, you’re actually costing yourself money. In some cases, yes, scarcity is not the best way to go. But in other cases, it is. You’ll discover which is which with each product you create and sell.

    It’s legal because there is no law against saying that I am only going to sell so many of these items. If I just want to sell 20 e-books, I can just sell 20. This is the same law that allows an establishment to put up signs that say, “We can refuse to service anyone” for whatever reason. In short, I can do it … period.

    Ah, but now we get to the ethical part of it. The argument that people make for this scarcity not being ethical is that we’re doing it ONLY so that we can bully people into buying something that they normally wouldn’t, at least right away, because they’re afraid of losing out on the offer. This is specifically true with price scarcity where a product starts at one price and goes up in price after X units are sold. All this is considered to not be ethical by these prospective buyers.

    Okay, so here is why it’s ethical.

    There are some products that, if printed and sold in mass quantities, would not be worth as much. People wouldn’t want to buy them KNOWING that a lot of other people had them. Now, you say this isn’t true with digital products?

    Imagine I had a digital product that promised to reveal a secret niche that nobody knew about and by getting into this niche, you could easily make six figures a year as long as it remained relatively secret.

    How comfortable would the average person be with my selling this product in unlimited quantities? Wouldn’t you more likely buy it if I were to say, “I’m only letting 20 people get in on this secret niche” and really meant it?

    To test my theory, I have done just that, and without question, when selling a product such as this in limited quantities, people were more willing to buy BECAUSE I wasn’t selling so many of them.

    It would be unethical of me NOT to limit the quantity, especially if I knew that selling 10,000 of these would flood the market and make the niche practically impossible to get into.

    And that’s just one example.

    What about software? What if I wanted to sell a new piece of software as a test at a certain price so that I could have a few people test it. Do you think I want to have 10,000 people test this software and have to respond to 10,000 inquiries or complaints? I’d rather just have 20 people test it and get back to me. So in this case, I’d sell only 20 copies. Nothing unethical about doing this.

    I could go on but I think I’ve made my point. There is nothing wrong with legitimate scarcity, whether it be a physical or digital product. Even memberships can be made scarce if you only want to have X number of members, especially with a membership where you have to be hands on with each person.

    So whatever issues you have with scarcity, get over them. They’re nothing but sour grapes from people who have nothing better to do but complain.

    Instead, use scarcity to increase your sales and profit.

    It works. Yeah, it really does,

    To YOUR Success,

    Steven Wagenheim

    Want some more great home business and marketing tips? Get my 4 Steps To Business Success and you’ll be on your way to a successful business in no time flat.

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