Scarcity as a Marketing Lever

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“The way
to
make something
valuable is to
make it
hard to obtain.”“The way to make something valuable is to make it hard to obtain.” - Mr Profound Marketer

I did some analysis to track the end-to-end conversion process for one of my Internet projects to identify the bottlenecks (and subsequently improve on them). As one would expect, the conversion from opt-ins to sales is usually the lowest (as this is the ’steepest’ step that a customer would take in the whole process from start till the end).

My analysis showed up some really surprising results - the sales conversion rates were well above normal, but the signup CONFIRMATION rates weren’t.

I drive my traffic almost exclusively to squeeze pages - I still subscribe to the ‘old school’ thinking that before any selling can be done, a consistent & repeated contact process with the customer will need to first be established. The effectiveness of squeeze pages has somehow gone down the drain during recent years but as of now it still works for me, at least from a marketing ROI standpoint. (It is interesting to note that the ‘grand-daddy’ of squeeze pages - Double Your Dating - has since changed into more of an information portal).

To comply to CAN-SPAM, my list is built via double opt-in. My confirmation rates stood at 76%, which is slightly lower than industry standard of 78.1% (AWeber - Oct 2007). Did some digging and found that the verification lead times are frustratingly slow - passing the 80% mark only in 3 hours.

I subsequently introduced a “countdown timer” in the signup Thank You page in order to create some urgency in the confirmation process. On the page, the optin ‘bribe’ would expire if no confirmation in five minutes. The result - 80% in 15 minutes! (See chart below)

Scarcity As A Motivator

The biggest challenge in introducing scarcity in an online business is that it is not ‘built-in’. The resource (the freebie for the opt-in, or the product that you’re selling) is not ‘depleted’ in any real way - unlike a set of CDs which could be limited since they are physical products.

In addition to scarcity, “social proof” is another strong marketing lever which will boost sales in any business, offline or online. I will blog more on how to use social proof together with scarcity to create strong ‘pull’ for your products.

Like This? Try These...

• Internet Marketing 101
• The Death of Brute Force Marketing