#18 Using Scarcity Tactics To Make More Sales: Ethics & Credibility Issues

What you will learn

  • What scarcity is
  • Why Scarcity is so powerful
  • How Marketers abuse scarcity to make more sales
  • When and where YOU should use scarcity
  • How to implement scarcity technically

In this podcast episode, Mark and I talk about the uses of scarcity, how it is often abused and when and how you can implement it yourself.

Resources Mentioned In This Episode

Full Transcript

Welcome to the Authority Hacker podcast, the place to learn field tested, no BS tactics to grow hack your online business, and finally, live life on your own terms. Now, you host, Gael and Mark.

Gael: Hey guys, welcome to the Authority Hacker podcast today, I am with Mark, how is it going Mark?

Mark: It’s going good, thanks.

Gael: That’s like the same thing you say every podcast.

Mark: Shall I cover with only unique each time?

Gael: Let’s just spin it up a bit.

Mark: The sorus.com/good.

Gael: All right. In today’s episode we are going to talk about scarcity and the ethics and the credibility problems that can come with using scarcity. And, if you want to find all the notes and all the tools we talk about and so on in this episode you can go on authorityhacker.com/18, and you will be able to find all the show notes and the links, and just the summary of the episode. But let’s just start with what scarcity is in case people don’t know it. Do you want me to do it? Or should you do it?

Mark: You can feel free to mention your own ideas but just generally, I mean scarcity is like some kind of restriction on availability of something, the way I think of it is like as a kid, whenever your mum told you, you can’t do that or you can’t have that, what’s the first thing that comes to your head- I want that, or I want to do that, so there is a kind of mental I don’t know if it’s like a biological thing or something, but there is a definite kind of mental reaction to being told you can’t have something or you can only have something for certain amount of time or in the case of what we are talking about with internet marketing is prices are going to increase soon or these extra bonuses or you are going to get, or only going to be able to get for a certain amount of time, any kind of like restriction like that would be, would come under the scarcity I guess.

Gael: Yeah, it’s actually a weapon of influence, like the book like “Influence ” by Chialdini, where he just lists all the factors, all the weapons of influence, I can remember them also asked me to say that but scarcity is a really powerful one and he did a lot of studies and so on and found that it could like triple sales in many cases when you just tell people that they can have it for after some time or something, and that’s something that we found on our sites in our businesses, we haven’t used scarcity a lot, in the sales we’ve done, but in the initial version of the juicing factor we’ve used that for our juicing e-book, and we’ve used that to sell the Authority Hacker Pro membership when we launched it as well, and the last 48 hours were like 70% of the sales, it was crazy, every 5 minutes we would make a sale, because the price was going to increase. Let’s actually talk about different modalities of scarcity, and how you can use it in different ways and I think the first one is the one that’s most obvious and the one we talked about it’s just like, this product, whatever you are selling, an e-book, or an actual physical product, is only going to be available either for certain amount of time or in a certain quantity, I know that H&M actually does that with small quantities of designer designed affordable pieces of clothing and it brings so many people to their shop so that is the first version, where you just set a deadline. And in terms of online marketing, it’s going to be very simple, it’s just going to be like, “Hey, on this date, this offer is not going to be available,” or, “after I sell 100 of these, this offer is not going to be available anymore”, and you purely and simply take it away from selling. And that is the model that Jeff Walker from Launch uses, right, I mean, you’ve read the book actually, I haven’t, Mark?

Mark: Have I? Which one was this?

Gael: “Launch” Jeff Walker.

Mark: Oh “Launch”

Gael: Yes. Wrong accent.

Mark: I thought you said lunch there for a second.

Gael: My bad. So that’s the way he uses it, right?

Mark: I actually can’t remember to be honest.

Gael: Ok, well, from my memory of reading the notes, that’s how actually he uses that, and it’s the simplest way to deploy scarcity in your business because you just take the page away after you are done or you just close the checkout. So, it’s a pretty easy way to do that. The other way to deploy scarcity is to make a price increase and that is especially useful when you are releasing something that is going to become an evergreen offer, so we actually use that when we released Authority Hacker Pro. What we did is, I mean, now if you go on the page the price is $47 a month, but when we launched it for the truth is, it was actually up for a month the beta pricing which was $38,80 and then we told after a month, we told people after a month that the price is going to increase, we actually didn’t say how much, we just said that the price is going to go up, and people bought like crazy. So it’s a pretty easy way to kickstart an offer especially if it’s a recurring, so it’s a good way to get a critical mass through the door when you open your service. And actually, I think that is something we should have used when we did copycog, when we launched that, I think we would have gotten a lot more people take action.

Mark: It’s also good not just because it’s good, but if you are using like as we did, affiliates to drive some sales, affiliates know that it’s good and they are much more likely to promote you if there is a pending price increase or they can like present some kind of legitimate scarcity to their list as well.

Gael: Yeah, I mean, when we actually had that offer running, the conversion went for the exact same sales page, the sales page didn’t change, the only thing that changed is I removed the timer now. And a price increased a little bit, but not a lot and the conversion it was like 4, 5 times higher than the sales page is right now, so I give you a good idea of like how much this kind of even just price increase can do for your sales initially. Now, another one that I really like and it’s something I really want to deploy more with Authority Hacker, this year because we do a lot of affiliate marketing, and if you follow the blog, you probably know that we recommend tools mostly that we use, and a lot of these tools you can just buy whenever, if you want to buy Ahrefs for example, you can just go and get Ahrefs and so for us to promote it, it makes it difficult, because people just get lazy or wait etc. But, what we can do, is we can actually offer bonuses, so I could create like a really nice course and I’m actually going to create a course with Thrive themes, a lot of people have asked for like a branding course, with Strive, so I am actually going to create that, and I am going to be able to do it, I am going to be able to put timer on that and I am going to be like, “Hey, if you purchased Thrive themes before this day, you will get my course for free.” And that is a great way to use scarcity to do affiliate marketing and all you have to do is create some kind of complementary product that makes the thing that people are going to buy better, and usually, all it needs to be is like a video tutorial, or templates, that kind of stuff, and then you can offer that with time stamp on it, even when the offer is evergreen, so it’s a really cool way to be an affiliate marketer and kind of make your list take action, rather than just showing them the evergreen offer and they are like, “Oh, ok, good to know.” And that’s it. I particularly like it, so Mark, do you just want to explain why scarcity is so powerful?

Mark: From a psychological point of view?

Gael: Yeah, pretty much.

Mark: Well, as I said before, like I think it goes back to this like inherent child thing that we have, where you want what you can’t have. Like people always desire, like no one wants stuff that they already have, like even when you- I assume, because it hasn’t happened to me, you become super rich and you have all these sports cars that you can buy, and you want-

Gael: You want to buy all those sports cars when you get rich?

Mark: No, no way in hell. I am just illustrating the point here, it’s that like a new one comes out and it’s like you want that one, but you already have 20, and what’s that going to do that the other doesn’t- nothing. But it’s just like there is this inherent human desire to have stuff that you don’t have, I think it’s an evolution or something like that. The same is absolutely true when you are presented with an offer, and any of those cases like those beta pricing say ending from Friday, you are not going to be able to- the price is going to go up. So, that’s creating a strong emotion and assuming that this is true, you know that you are never ever going to be able to have this again, and then, that like sets off all these emotions, like you want what you can’t have, so-

Gael: I think there is also this feeling of getting a good deal or a better deal, especially for the price increase or just for, I mean for the limited time not really, but for price increase, it’s just like I like the idea of telling myself that I paid less than most people would pay, and I don’t think about my money, I think about the value I get compared to everyone else given the money I spend, so like the value per dollar spent-

Mark: Yeah, which logically is a wrong way to think about it, and I think that kind of hits the nail in the head, that this is not a logical statement, or this is not a logical issue we are dealing with here. We are dealing with the very emotional something that really gets to you, and makes you to take action, and this is absolutely something which you need to, which you should take advantage of in the sales process, you want to get people to make these emotional decisions rather than logical decisions. Sure, you might have the best product in the world, and the really good price and all that, and there may be as there are in many of our products, good logical reasons to buy them, but you have that different people behave in different ways and different people respond to different kinds of incentives be that logical incentives or emotional incentives, so you need to kind of address all of them.

Gael: Yeah, I think just that timer, the giant timer and you see the time counting down and stuff, it really switches you to like more emotional state as well, it’s just like, I would be a rational buyer usually and then there is a timer and I am like, “Oh my God, we need to decide now, it’s going to be going away, I have no idea if it’s going to be here etc.” Even though I know this stuff, it’s still like I still feel it when I buy a random product for launch and most of the time I actually don’t enjoy it, but yeah, it definitely works. But the truth is some marketers do abuse scarcity. And, I just want to talk a little bit about that and about what this does, to credibility. And so, I think the most common way and I think a lot of people that listen to this podcast are online marketing, and people use that extensively, in this market, and it’s pissing me off a little bit to be honest, the first one is the fake close, where people give you the day, let’s say Friday night I am closing it, and then, on Saturday, they send you an email and they are like, “Oh my God, there was so many people asking for it, that means the deadline I am keeping it open until Monday. But this time for real, I am closing it on Monday.” And, on Monday they close it for two hours and then like, “Oh, some more people actually missed it out, so I am closing it Wednesday promise, promise, I am closing it on Wednesday.” And basically, they keep pushing that. And the truth is, because they don’t have one deadline, they have 4, 5 or whatever and there is always a reason for that, obviously mine were not very good but a lot of people find slightly better reasons for doing that, they have more deadlines than they use, but actually when we close Authority Hacker Pro, we actually close it, if we say it closes on this date- boom, closed. And actually, I saw all the failed transactions after, and we literally had people email us telling us that- thanking us for actually closing it on the date and they knew they could trust us, and I think that if you pulled that off a few times, you can definitely make more money but you are going to burn a lot of people on your email list as well and you are going to be that online marketing guy which I personally would hate being, I’d rather just do another launch later and or make a special offer later and so on.

Mark: Yeah, plus there is only so many times you get away with doing this, and eventually, the people on your list are going to be like ok, this is just complete bullshit.

Gael: Yeah, and they don’t respect your deadlines anymore. Another one- and this one is going to be a little bit controversial and I feel bad talking about this one because actually it’s something that Neil Patel uses, on neilpatel.com and the reason I feel bad talking about this is because actually he links up to us, but I am s till going to talk a little bit about it. so, if you go to neilpatel.com, for example he has, you opt in for his list, or for his evergreen webinar which is a video and it’s basically a time on top that says like 2 days, 3 hours, something like that, and this counter is actually an evergreen timer, so if you come back in 3 days, it will just reset and he will keep using that. And I don’t know how much it works for him, but I know as an online marketer I see that and because the way evergreen timer has worked for now, and let me talk about the tech a little bit after. It’s that they actually show the normal timer and they kind of like refresh a second after you loaded the page, with the timer you run based on the cookie you have on your machine, right. So, it’s actually very easy to spot, this kind of timer and for me this destroyed any credibility for the offer when I saw that. So, in general, evergreen timers and when I say an evergreen timer it’s a timer that is specific to you. So when you actually land on the page, you will start on the timer that the default timer which is like 2 or 3 days in that case, and then it’s going to drop a cookie on your computer and when you come back to that page the time between the time of the timer when you landed the first time and the time that passed, will actually have elapsed, but when it reaches zero, really nothing happens, usually the timer just resets. And, I mean, I don’t know how you feel about that, but for me, when I actually got through the offer, I felt like kind of shitty, actually. How do you feel about evergreen timers, when you actually get on one?

Mark: I don’t know how I subconsciously feel about them, but consciously basically I ignore them, I assume that they are all fake.

Gael: You ignore all timers?

Mark: Yeah, so I don’t think I have ever seen one which has been like yes, ok, it’s legitimately going away. That being said, let’s think about things- I mean, you are buying much more of the actual IM products than I am, but in general, I never take note of them. One thing I will say that like really I remember specifically taking action on, is I was buying this DJ training like video course, and I was presented with like an upsell offer, which was a VIP Facebook group and a bunch of webinars and it didn’t really, it seemed all right, the Facebook group was kind of appealing, but rather than having a timer, the guy actually said like, and I was watching him say it in the video, it was like, “Look, this isn’t one of those things, it’s like, it’s legitimately, this is going away, this is the only time you will ever be offered this, so if you want it, you have to click it now, you can’t get back to this page ever again.” And I was watching him say that on the screen and that for me did it, I bought that, but that was like kind of what, it felt much more like it was actually going to happen rather than these timers, I just because there is a few technology options out there, but like very few people use them, which have legitimate scarcity timers, they are always these ones which are set to a specific time when you load the page, so yeah.

Gael: Yeah, I mean, I just want to talk about the technology of evergreen timers in general. There are a few options out there we tried a few, and to be honest, they are all terrible. And, the technology just isn’t out there for quality evergreen timers, so I really would love to use evergreen timers if I knew that it would actually properly close the offer for people when the timer runs out. It’s like they can’t go back to it, they get a cookie and then that’s it, then they just can’t go back to this page they can’t buy it, it says the offer is closed. When the technology gets to that point, and I know for a fact that the guys at Thrive theme actually are working on it because I’ve been begging them to; if that works properly, then I am going to be a big user of them, right now every single implementation I’ve seen of them has been terrible at killing the trust I have in the marketers in general. So, I would actually just recommend using date based timers for now.

Mark: The thing is though, I mean we are saying that from our own perspective, and that is people who really know how the internet works, I mean, you have to remember the average user doesn’t even know what an affiliate link is. So unless you are in the internet marketing niche, then this is different, but if you are in the health niche, then you can absolutely use this like- it’s an ethical thing to consider, but you can absolutely do this and get away with it and make much more money, so I think that’s why we still see it used so often.

Gael: Yeah, I mean, in the health niche, there is affiliate offers that we push that actually use that, people scroll down the page and it says, “Oh, you are eligible for a discount,” and then it transforms a $50 price tag to a $10 price tag, and it just upsells the difference, after. And, the conversion rate is very good to be honest. I think you are right, and what I said, it was very online marketing oriented, and if I was to sell to the Authority Hacker crowd no way I would do that because that would be super obvious for a lot of people and we would lose a lot of trust. In the B2C niche, yeah, you can get away with a lot more than that, it’s all about are you willing to deal with this one percent that is going to catch you and just not being happy- the truth is you will make way more money but the way it is done right now it’s just terrible technically, but it does well, you can literally just send an email as an auto-responder saying this is closing tonight and put an just like make a different landing page with a different evergreen timer and people could always go back to the email and click on the ink and buy, right. But 99.99% of people will not see the difference. So it’s true, it’s true, you can actually do that. But, let’s go back to the way actually people abuse it. Another thing that people abuse, which is a lot less technical, is just they actually just take all those behind the doors after the deadline, right, so people just email them and they just, “Hey, here is a link, go and buy it,” and they just make a lot of sales following that. Why should one do that and why should one not do that?

Mark: Again, you can get away with doing that, to some extent and it’s interesting to think that if you have ten people emailing you a day after it’s quite easy, you just sent them secretly, no one will find out, but you do that enough times people eventually find out, and if you are doing this, like with an authority site, and you want to sort of foster community and grow like an audience, you are going to have the same people or a lot of the same people in that audience for a long time, and that only takes a few people to kind of hear about it and then, someone post it in the Skype group and then before you know, there is dozens of people know about it, and then someone post it on the forums, and then just, it spirals out of control quite quickly. So I can remember with the Authority Hacker there was a guy who emailed and he, I think it was this one was it, he emailed us and he was like, “I was flying across the Atlantic I couldn’t”-

Gael: There were two guys, there was one guy that just was like, “Oh, I am on the flight etc.” I’ll let you tell the story, I am sorry.

Mark: So, I can’t remember the specifics, correct me if I am wrong, but a guy was on his honeymoon or something, so he couldn’t buy it, and then but I thought that he was just making that up, so I was like just reply ask him to send a photo from his honeymoon, and so he did!

Gael: Yeah, yeah, we got a picture in the sand with the honeymoon thing etc, so that guy got it.

Mark: But, he was the only one.

Gael: Yeah, yeah, there actually are people that literally insulted me for not letting them have it in better price. And the price only went up, like $10, right, it’s not exactly like it was unavailable or anything, it was like I don’t want you in, no matter if you buy or not, they didn’t buy, but yeah. If people have a really good excuse or something, obviously if they went to a funeral we do not ask for a picture, but if people have a good excuse then let them in and then tell them it’s the last time, otherwise, don’t do that, basically. Just as a- I think that’s basically the ways that people can abuse the scarcity stuff. A technical way of implementing a countdown, just a countdown, it’s pretty easy, you can use Thrive content builder, you can use click funnels if you use click funnels, it’s pretty good tool for landing pages and the funnels, if you don’t have Thrive, so any kind of like builder pretty much has these countdowns now, just put the date, and email your list with the counter, that’s basically it. And I think we are just going to close this podcast, with some tips to use scarcity to make sales, because scarcity is really amazing, actually I tend to tell people that I am terrible at writing sales pages, I am horrible at it, that’s the one thing that I definitely need to work on, but when you put a countdown on a page, you literally triple your conversion, right, so that is a tool I like to use a lot, because it kind of saves my bad copyrighting skills, but you need to do it properly.

The three things I would say is- first, don’t use it on everything or promo, people are going to get tired of it, if I emailed you guys every week or every two weeks with the timer based offer, at the end people just wouldn’t care anymore, they would just know that anyway, the next one is coming in two weeks or in one week, and it’s not going to change much, so use it once every couple promos, not every promo. When you have a deadline, stick to it, even if you are going to lose a little bit of money at the end and you will, you will see that people actually trying to check out and cannot. Just stick to it, especially if you are building that long term relationship, and for now, I would actually not recommend to use any evergreen solution, I hope Thrive comes up with a solution, but to be honest, it’s a very challenging, technical challenge so I am not sure they will get it right on the first try, but if they do, I mean, I’ll test it and I’ll tell you guys, for now, stick to date based scarcity and offers.

All right, cool, well, guys, thank you for listening to the podcast, if you actually want to get all the show notes, the tools we talked about and maybe the books and so on, go on authorityhacker.com/18 and you will be able to find everything that you need. Thank you for listening, and see you guys in the next episode.

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2 Comments

  1. Hi Gael and Mark,

    Great podcast on Using the Scarcity for Sales. I always find it kind of funny, because we all KNOW that scarcity is used to make sales, but somehow it still works! I guess it does come down to what Mark was saying regarding we always want what we can’t have…it’s so much of an emotionally driven behavior. Good to hear you talk about how to maintain credibility whilst using scarcity.

  2. Wow, I like the idea of using scarcity to increase sales. Especially increasing the price after a deadline.

    This will push potential customers to purchase the product. Anyway, this is a great podcast.

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