Sunday, July 13, 2008

Creating Demand

There is a reason why books are placed on a "best seller lists" and not "best written lists." Although unique ideas are valued, our society often conforms to follow the popular. We want to feel unique, but also reassured that our decisions are respected by our peers.

New products and services are often marketed as a scarce commodity, before they are readily available to the entire public. Recently, Coldplay released a few songs from Viva La Vida, before the album was released in stores. The scarcity created demand for the entire album and the record sold in large quantity on its release date. This weekend, Apple released the new Iphone. Instead of allowing store preorders to create a more convenient shopping experience, Apple allowed its consumers to wait in large lines outside stores. The perceived scarcity created a large demand, confirming that the new Iphone was cool, worth the attention and purchase.

Similarly, successful social networking sites use scarcity to construct an allure. Ingeniously, Facebook first open its doors to college students, then high school students and eventually everyone. The gradual roll out created more demand and new registrants became more invested in the site.

If you are going to ask someone on a first date and they said they were available on Monday, Tuesday, Wednesday, Thursday, Friday and Saturday night of next week, the over availability could alter the attraction. Yes, a person should be available, but too much initial availability can cause early attraction to be lost. Contrarily, if the person responded with only Saturday night, it would make that one night exclusive, desirable and in demand.

On September 21, The Yankees will play their last baseball game ever at Yankee Stadium before they move to a new venue. What's the value of scarcity, if the demand is high enough? Well, tickets are listed on Stubhub for as much as $65,000 each.

No matter what product or service you are promoting, try using the perceived image of scarcity to create demand. Give it a try, you maybe surprised what you mix up.

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