You already probably know that time-limited offers are a powerful marketing technique. Admit it or not, at one point or another, all of us were tempted to jump on the exclusivity bandwagon and purchase something before the promotion is over or the countdown ends.
A limited-time offer is a sales tactics based on the scarcity principle. So, before we delve into what makes limited-time offers so effective, let’s briefly examine the principle of scarcity first.
Investopedia defines it as follows:
“The scarcity principle is an economic theory in which a limited supply of a good, coupled with a high demand for that good, results in a mismatch between the desired supply and demand equilibrium.”
In simple terms, this means the more difficult to obtain a product is, the more valuable it becomes. And it’s inherent in human nature to want more of what we can have less of.
Ever heard of the beer goggle effect? In layman terms, it’s the theory that “all the girls get more attractive at closing time” (and with the increased amount of alcohol in one’s veins).
In 2010, a group of Australian researchers decided to test this hypothesis. Their findings? The “beer goggle effect” doesn’t have much to do with alcohol – it’s actually a textbook example of the scarcity principle.
So, the girls are not “getting more attractive” because of alcohol. It’s because the number of options is getting lower near the closing time.
In the paper titled Consumer Preferences and the Power of Scarcity, Ratner and Zhu state that
“When something is rare, it’s alluring–true whether you’re talking about precious gemstones or a pristine edition of the first issue of Action Comics (which introduced Superman). And psychologists have long known that if you can make a consumer good more desirable by making it appear rare.”
There are two types of scarcity that can be used to boost sales:
Here we’re going to focus on time-related scarcity, achieved by presenting your customers with a limited time offer. Adding an expiration date to your offer also ads a sense of urgency and pushes people into action. As people don’t want to miss out on a potentially great deal, a countdown timer is often enough to make them act.
Marcus Taylor’s ‘Groupon deal for musicians’ campaign, for example, led to an amazing 332% increase in sales, which was achieved by adding urgency to his offer.
This leads us to another psychological phenomenon closely tied to the principle of scarcity – FOMO or “fear of missing out”.
FOMO stands short for “fear of missing out”. The dictionary defines FOMO as
“anxiety that an exciting or interesting event may currently be happening elsewhere, often aroused by posts seen on social media”.
FOMO is probably best exemplified in this study conducted on single women. Namely, a group of women was shown a photo of their potential dream guy. Half of them were told he was single, while the other half thought he was taken.
The results? 59% of women who thought the guy was single said they would date him, but the percentage jumped to 90% when they thought he’s in a relationship. The reason? Or at least one of the reasons – fear of missing out.
Starbucks is one of the most famous brands that use FOMO to their advantage. They do so by making limited time offers. For example, those red holiday cups – they have been a part of every holiday season since 1997.
But what’s the deal? Not only are they available for limited time only, but they also change every year. So, if you don’t manage to get it that very season, you’ve missed out. Or their famous Pumpkin Spice products (but more on those later).
Which leads us to the question – how to create a limited-time offer that says “buy now” and not “bye now”? One of the best principles in marketing (that can be applied here as well) states – see what the best do and try to learn from them.
So, here are some limited time offer examples that you can learn from.
Every day, Tiger Direct offers its customers a Daily Deal Slasher. And every day it’s a different product that’s discounted.
They even have a huge timer that counts down the time until the end of the promotion and creates a sense of urgency. The “Today’s Deal Ends in: 19 Hours : 48 Minutes : 21 Seconds” can be more persuasive than you would have thought.
Amazon is another huge company that employs the benefits of a limited-time offer. If you go to amazon.com, you’ll see a bunch of daily deals on a variety of items, from ebooks to bedsheets. Amazon’s daily lightning deals are available for only a few hours, so it’s easy to miss out on them if you don’t act quickly.
In addition to daily offers, they have special deals for particular holiday seasons, especially the most commercial ones such as Black Friday and Cyber Monday.
In addition to time-limited offers, some companies have introduced season-limited offers. Those offers are only available during certain periods of the year or on specific holidays.
Let’s take one of the most notable examples, Starbucks’ Pumpkin Spice Latte. Starbucks lovers go crazy over this taste during every fall, and the very fact that it’s available only in that season increases its sales. It’s this seasonal exclusivity that makes it so popular and sought after.
You better enjoy it while it lasts (or at least that’s the message Starbuck is trying to get across).
One of the most popular American shorts sellers, Chubbies, also takes advantage of time-based scarcity in a great way.
Chubbies are famous for their 4th of July seasonal limited-time offer. Every year, a special item is available on pre-sale, guaranteed to arrive just in time for the 4th. They let you know that by taking action now, you won’t miss out. But if you don’t, you risk becoming a victim of FOMO.
Sports fans are particularly suitable “victims” for limited-time offers. Plus, in sports, there are many events that happen only once. For example, a team won Superbowl 50 years ago (and is unlikely to do so again in the foreseeable future), but that doesn’t stop brands from selling anniversary-themed clothing and memorabilia decades later.
Still, one of my favorite examples ever is the ‘sad Bill Murray’ t-shirt that was available as a limited time offer after Wisconsin beat Xavier and made it to the Sweet Sixteen.
Of course, running a limited time offer on your website doesn’t mean a thing if you’re not selling something people actually want to buy. So, before employing the principles of scarcity and FOMO, you need to make sure you’ve made a compelling offer.
Quizzes are an extremely effective lead magnet. They hook you in quite easily. They have a great lead-generation potential. They’re shareworthy. Learn how to create your own quiz and use it to generate leads and sales right now!
If you’re looking for additional inspiration, take a look at these 25 brilliant examples of compelling offers. Come up with your own, pair it up with time-related scarcity principle, use an adequate lead magnet (such as online quizzes) and watch your leads and sales generate easier than ever!