Artificial scarcity or
"If you want to be valid, make yourself scarce."
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Artificial scarcity or „If you want to be valid, make yourself scarce.“

Have you already heard? The Kinder Egg has gone on a summer break. The Kinder Egg! The piedmont cherry, yes. It’s always been that way. But the Kinder Egg? On 15 May no less. If that’s not artificial scarcity, then what is? Ferrero says it’s the heat. But if it’s the heat, why are Kinder Eggs usually reintroduced in mid-August, when summer is at its hottest and, in times of climate change, far from over? Well, we don’t want to seriously question Ferrero’s reasoning here, nor do we wish to question whether the shortage is either artificial or climate-related. But it certainly is a shortage. And it stirs something in us, we don’t know quite what, we don’t know how, but it works: namely desire. And once it’s awakened, it’s not simply awake, it grows. We’ve seen this recently with a completely different product – toilet paper.

Artificial scarcity leads to the strangest excesses.

Do you still remember? Or have you already suppressed the memory? The run on toilet paper – at some point, it must have been a long time ago, maybe it was March, maybe perhaps in April – when customers in the queue at the checkout covertly filmed scenes of people fighting over bog roll, who had the whole shopping trolley full of the stuff, who waddled across the streets with several packs under their armpits, and straight off into quarantine. Yes, we were probably all a bit more scared than usual. We ourselves – that is, you and I – weren’t, of course. Of course, we only bought the toilet paper because we needed it at the time – and maybe even once when there was by luck alone just one last lonely pack on the shelf. But there were quite a few others. Someone – according to a report in the, I don’t remember where, I don’t remember when – must have invested a fortune in toilet paper, presumably to resell it at a profit. Apparently, the business model didn’t work, because he then tried to exchange roughly 4,800 bog rolls back again. By then, the shortage had already been overcome. Google it. “Toilet paper hamstering”. Very enlightening. Aside from the case already described, which is said to have happened in Australia (not only in Germany did they hoard toilet paper), there are numerous cases – stretching from “toilet paper hoarding escalates” to “woman beats security guard” and “toilet paper purchases reach insane dimensions”. And, of course, this here: “A psychologist explains why ...” A few weeks later, the same thing happened again with mouth guards.

The law of scarcity.

In principle, the summer break involving “Kinder Ice Cream” works along the same lines and leads to similar excesses, though not to the same extent. But here, too, there are examples of squirrelling stuff away, thefts and certainly one or two tragic scenes at the checkout, when the mostly underage consumer throws him- or herself on the floor and, despite howling, screaming and kicking, doesn’t achieve the desired result, because it is not the parents’ hearts that have to be softened, but a production pause caused by the market economy that simply has to be endured. What comes into play here is the “Veblen effect”, named after Thorstein Veblen, who in his work “The Theory of the Leisure Class” described as early as the late 19th century the phenomenon that customers – depending on the purchasing behaviour of other consumers – are willing to pay higher prices for products if others want them too. Usually, this effect applies, above all, to luxury goods, the possession of which is an expression of the buyer’s elevated status. For the Guccis and Versaces, the Lamborghinis, Bentleys, Maseratis of the world. But in times of greatest need, it also applies to dry bread. It’s perhaps especially true for typically inferior products such as toilet paper. This shows how – and I apologise for the drastic wording – money can be made with shit.

Scarcity for brands – and makers.

The phenomenon can take on almost mythical-religious proportions: Nothing is longed for and worshipped more than an absent deity. With Nietzsche, it was still Dionysus. In identical fashion, this applies to every messiah, saviour and redeemer – of whatever. Accordingly, there are those who are born with charisma and a flair for the basics of psychology, who take advantage of this, whether they are politicians, pop stars or celebrities, delaying and dosing their appearance just right. They only perform when the audience has already gathered, when supporting groups or entertainers (or at least presenters) have already warmed up the atmosphere a little, so “the market” has been created and opened for business. They’re also nothing more than an article, an offer that a supplier brings to market. They’re the same ones who are the last to arrive at the after party and the first to leave because “they still have somewhere to be”, because there are “others” waiting. Somewhere. In Thomas Gottschalk’s case, it was the VIPs who all had to get on their plane immediately after their appearance, wherever it was they were going that evening. The proverb “If you want to count for something, make yourself scarce” has proven to be true here. Conversely, no one has diminished the value of these stars more shamefully than Markus Lanz, who also put his guests in bunny costumes, downgraded them to extras and thus devalued them like cheap bus tickets. Scarcity would’ve been urgently needed here, even if it would hardly have saved Germany’s famous show “Wetten, dass ...”.

One round of scarcity, two campaigns.

But those who know how to play the keys of scarcity correctly also know how to turn it into campaigns. And how? The confectioner Mon Cherie isn’t available right now? The Kinder Egg is on a summer break? Then the provider is simply playing with availability: “Buy now. Stock up quickly.” And: “Be back soon. Back in your chiller cabinet you go go go for the umpteenth time.” Two chances to artificially boost sales. The persuasiveness of both dates is striking; no one needs to have read their Robert Cialdini for that. These are offers that cannot be refused, to use Vito Corleone’s words – another example of a PR manager with a powerful skillset for persuasion. Even the suppliers of bog roll have played with these laws of scarcity when they announced their inability to be able to keep up with production as long as there is a lack of waste paper. Presumably, this news immediately sent a few more customers rushing to the supermarkets to fight.

Scarcity must be compensated for through communication.

This draws attention to one decisive fact: For all the (artificial) scarcity, or scarcity caused by real circumstances: It’s important to stay in the minds of the customers – or to get into the minds of the customers in the first place. Therefore, scarce consumer goods must be compensated for by more communication. What counts is content. Information. That which isn’t there must be presented as urgently present and available, as desirable, necessary and indispensable. You have to want it and be able to have it, no matter what the price. That’s why offer after offer rain down on us. This is because people want to understand what they are missing out on, why they should want it, but also why it is worth it. With Mon Cherie, it’s the piedmont cherry. In the case of the Kinder Egg, it’s the surprise that is enhanced by a special offer now and then, especially in every seventh egg. And with the loo roll? In this case, it’s more likely to be the information that there is no real lack thereof.

When supplier, item and offer are perfectly matched to customers.

But playing out this information requires a communication strategy, just as there must be a shortage strategy before that. The supplier, the article and the offer must be equally relevant for the customers. For the stylish woman around the 40 mark, it’s not just a cherry brandy chocolate, it has to be Ferrero, in September. She’s also prepared to pay the higher price for this. That’s because it’s not just a product, any product, but a very special product. Simply because it’s not just about use, but about a benefit, in actuality a value, namely added value. And because it’s precisely these offers that make us feel a little better, a little more valuable, because we paid a few cents more for the bar of chocolate. Ultimately, it’s precisely this difference that makes us human beings, real human beings. Just so we’re clear here: That’s not my opinion, it seems to be what arrogance is all about.

It’s about compensating for scarcity with creativity.

What does this mean for you now? What is the benefit of this article for you? And the moral of the story? Honesty: No idea. Only that if I were – let’s say, for example – an entrepreneur, or – even just by way of example – a product manager, and I had a product whose value I wanted to increase for my customers, then scarcity would definitely be a means I would consider. Even if it’s only the case that it’s not deliverable for some reason. And right at that moment I would ask myself, how can I increase the value? How can I stay in the minds of my customers? How can I play my product off against other, comparable products more effectively? And I’d think about communication strategies, about two campaigns, about how information and content can be widely distributed in media, but targeted precisely to the customers who are “hot for this stuff” – this is exactly where we are as we circle back to toilet paper. This is because it was precisely this gap that the resourceful confectioner filled by offering it to men and women in cake form. He has filled the void with – if you like – a form of artificial compensation and thus stuffed all the mouths that were crying out for more paper. That was a creative solution. And that’s exactly what is needed if scarcity is to be compensated for through communication.

Artificial scarcity in a nutshell.

For some reason, you came across this article. And the most plausible reason is: You googled “artificial scarcity”. So this article has been written just for you. So that you’d find it. With that, should you feel that this article has brought you nothing – really nothing at all – because you had actually wanted to learn more about artificial scarcity after all, you should consider that you may not have found this article because it offers you exactly the content you associated with it, but rather the right provider of communication strategies that fit your scarcity strategy. If this is indeed the case, it’s best to contact us now. Otherwise, we hope to have entertained you at least a little. Perhaps even quite well.

 

More information is available from:

Christoph Siwek

Creative consultant / Group Head Text
christoph.siwek@schindlerparent.de 

Contact us.