The Science Behind Scarcity and Its Influence on Decision-Making

Opportunities seem more valuable to us when their availability is limited. Something that on its own merits, held little appeal suddenly becomes attractive merely because it would soon be unavailable. The “limited-number” tactic is commonly used by various industries.

The idea of potential loss plays a large role in human decision-making. In fact, people seem to be more motivated by the thought of losing something than by the thought of gaining something of equal value. If it is rare or becoming rare, it is more valuable to us.

The most straightforward use of the scarcity principle is the "limited number" tactic when the customer is informed that a certain product is in short supply and cannot be guaranteed to last long. The intent behind this strategy is to increase its immediate value in their eyes.

There is also a variant of the deadline tactic called the "right now" tactic. When customers are told they either will be charged more or won't be able to buy unless they buy immediately. They are asked to commit to buying the product when it's least available & most desirable.

The scarcity principle operates on two major sources: We rely on a shortcut that things that are easy to possess are less valuable than the things that are difficult to possess. We often use an item's availability to help us quickly and correctly decide its quality.

As opportunities become less available, we lose freedom, which is something we hate to lose.

When our freedom to have something is limited, the item becomes less available and we experience an increased desire for it.

The biggest sales were obtained by informing buyers of a restricted supply and stating that this was exclusive information - a twofold scarcity strategy. The scarcity that is newly experienced is more powerful than constant scarcity.

The scarcity principle not only applies to material commodities, we react to information restriction in the same way by valuing the banned information more than ever. We will find a piece of information more persuasive if we think we can't get it elsewhere.

How To Say No: Scarcity causes us to respond emotionally, making it difficult to think clearly. Assess products and services solely on the basis of their price benefits. It should be of no importance if an item is disappearing fast.

When facing scarcity pressures, you should:

You must recognize emotional arousal as a signal to calm down and gain a rational perspective. Then we should ask ourselves why we want the item under consideration.

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