Behaviour Change

PROPAGANDA FOR CHANGE is a project created by the students of Behaviour Change (ps359) and Professor Thomas Hills @thomhills at the Psychology Department of the University of Warwick. This work was supported by funding from Warwick's Institute for Advanced Teaching and Learning.

Thursday, February 4, 2016

Final Clearance!

My housemate had knocked on my door about a week ago, showing me the page for ASOS on her laptop, with a bright, neon sign with the words “Final Clearance” splashed across it. She then proceeded to plant herself on my bed, with a huge grin on her face, whilst clicking through the website. 

I realise that seeing signs like “50% off” or “final clearance” makes people, myself included, feel like buying those items, even if we do not really have a need for such items. I remember feeling like I needed to buy those items quickly, before they run out. This is particularly true especially if I see the words ‘limited edition’, as the product then feels even more valuable.

By having sales and discounts, this marketing technique utilizes the idea of the scarcity principle as a form of persuasion, to get people to buy their products. The scarcity principle is one of the key principles from Ciadini’s theory of influence, where people's perception of scarcity will influence their demand for the product. Scarcity is a fundamental economic theory, relating to supply and demand, where there is basically a limited amount of supply but an unlimited amount of demand. So, Ciadini’s view of scarcity is that, the less there is of something, the higher the demand for that product is, hence increasing its value.

Worchel, Lee and Adewole (1975) looked at the participants’ desire for cookies, which vary depending on the reason to why the cookies are scarce. They found that participants desired the cookies and rated them to be more valuable when the cookies are scarce, especially when the amount of cookies dropped – from abundant to scarce. This means that when the cookies are relatively scarce, participants tend to have a higher rating of liking and preference for those cookies. Additionally, when the cookies were low on supply due to high demand, rather than due to an accident, participants tend to prefer those high-in-demand cookies. So when they are offered two different jars of cookies, one with ten cookies in it, and another with two cookies in it, participants tend to choose the jar that has two cookies.

Table 1 shows the means for participants' ratings for their liking, attraction and cost for study 1. Participants are asked certain questions that are based on a 9-point scale, where 1 is ‘very much’ and 9 is ‘not at all’. As shown above, the liking ratings for the cookies that are low in supply are generally much higher than the cookies in abundance. Participants were also asked to rate the attraction of the cookies, and the cost they think those cookies should be. Participants rated the relatively scarce cookies to be more expensive than the cookies that are constantly scarce. They also did a second study to look at whether the results from the first study were due to demand characteristics, which they have found that the participants were not aware of the nature of the experiment. Their study can therefore conclude that the desirability of the cookies have increased due to its scarce nature. 

This study can therefore be applied to various real-world examples, such as my friend’s response towards that ‘final clearance’ sign. As they believe that stocks are running low, this thus motivates people to buy things. As scarcity enhances the product’s value, knowing that the product might run low soon increases people’s demand for it. This therefore causes them to want to buy the product. 

What a sneaky little marketing technique!

Cialdini, R. B. (2009). Influence: Science and Practice. (5th ed). Boston: Perason Education.

Worchel, S., Lee, J., & Adewole, A. (1975). Effects of Supply and Demand on Ratings of Object Value. Journal of Personality and Social Psychology, 32, 906 – 914.  

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