An analysis of Scarcity in Marketing.
It’s well known that scarcity in marketing really works. Read on to understand why it works and how to get the best out of scarcity.
It’s a simple marketing idea: if something looks like it might run out, people want it more. Think ‘limited edition’, ‘selling fast’, or ‘only available until midnight’.
This article is based on an Australian academic meta-analysis paper where the authors pull together results from lots of past studies to work out how strong the effect is, and when it works best.
You can read the full 18 page article over on ScienceDirect by following the link below. Or you can read on for the key points…
Pop over to ScienceDirect and read ‘Scarcity tactics in marketing: A meta-analysis of product scarcity effects on consumer purchase intentions’
ok, here you go… here’s a super short skimmable version…
Scarcity tactics in marketing – a meta analysis of how scarcity works
What they analysed
- A meta-analysis (a study of studies)
- 416 effect sizes from 131 studies
- Main outcome they focus on: whether scarcity increases purchase intention (how likely people say they are to buy)
What are scarcity marketing tactics (and what counts as a scarcity message)?
Scarcity tactics are messages that make a product feel limited, either because lots of people want it, because supply is restricted, or because time is running out. Typical examples are ‘selling fast’, ‘limited edition’, or ‘offer ends soon’.
The big overall finding
Scarcity usually works. Across studies, scarcity cues tend to increase:
- Purchase intention
- Perceived popularity
- Perceived quality
- Perceived value
- Willingness to pay
- Plus smaller lifts in attitudes, desirability, and enjoyment
In simple terms: when you make something feel limited, people are more inclined to buy and often assume it is more popular or better.
The three main types of scarcity they compare
1) Demand-based scarcity (quantity is low because lots of people are buying)
Examples: ‘selling fast’, empty shelves, queues, ‘X people viewing this right now’.
2) Supply-based scarcity (quantity is low because the seller restricts supply)
Examples: limited editions, restricted distribution, ‘only 500 made’.
3) Time-based scarcity (availability is limited by time)
Examples: ‘only available today’, ‘sale ends in 2 hours’, seasonal products.
What are the risks of using scarcity marketing (and how do you avoid backlash)?
The main risk is trust. If customers think the scarcity is made up, the short-term lift can turn into long-term damage.
- Don’t manufacture urgency: avoid ‘ends tonight’ if it quietly comes back tomorrow.
- Be specific: say what is limited (units, dates, places) rather than vague ‘hurry’ language.
- Match the message to the product: scarcity works best when “limited” feels believable for that item (tickets and releases, yes; everyday essentials, less so).
- Watch for fatigue: if everything is “limited”, nothing is.
- Make the next step easy: if you push urgency, remove friction at checkout and on mobile.
Is one type of scarcity always best?
Not really. All three can work. On average, supply-based and time-based scarcity are slightly stronger than demand-based, but the differences are not huge overall. The more important point is: the best type depends on what you’re selling and the context.
What works best for different product types
Experiences vs physical products
- Experiences (events, tickets, travel, activities): supply-based scarcity performs best. The effect for supply-based scarcity on experiences is reported as about three times larger than demand-based scarcity in their comparisons.
- Physical products: no clear winner between scarcity types.
Hedonic vs utilitarian products (fun vs practical)
- Hedonic products (treats, pleasure, status, ‘want’ items): supply-based scarcity tends to work best (time-based can also perform well).
- Utilitarian products (practical, functional, ‘need’ items): demand-based scarcity works best. The logic is basically: ‘lots of people are buying this’ feels like useful reassurance for practical purchases.
High involvement vs low involvement purchases
- Low involvement (quick, low-stakes buys): scarcity types perform similarly overall.
- High involvement (more thought, higher stakes): supply-based and time-based scarcity do better than demand-based.
Visibility matters (will people see you with it?)
- If the product is used in a visible way (others will notice): supply-based scarcity is more effective than demand-based. This fits the ‘exclusive’ angle: scarcity adds status when it can be seen.
- If the product is low visibility: the differences between scarcity types are smaller.
How do you use scarcity marketing without sounding fake or annoying?
Use scarcity messages only when they are true, and make the “why” obvious. If stock is genuinely limited, say what is limited (units, access, dates). If it is demand-led, keep it grounded (for example, ‘selling fast’ rather than melodrama). This paper also flags that context matters, so testing is safer than going all-in.
How the message is delivered matters
- When scarcity is communicated via advertising, supply-based scarcity performs best.
- For physical displays (like shelves), the paper doesn’t find a clean “physical display makes demand-based scarcity clearly best” result in the way they expected.
Brand familiarity (known vs unknown brands)
- Scarcity works for both well-known and less-known brands.
- They do not find strong evidence that “the best scarcity type” changes depending on brand familiarity.
- But scarcity effects are bigger overall for less familiar brands than for highly familiar ones.
Consumer differences (age, gender)
They don’t find meaningful differences in the scarcity effect based on average age or gender split of the samples.
Country differences and study design
- Some variation by country shows up (for example, the effect is reported as larger in Korea and smaller in some European samples).
- Within-subject studies (where the same people see multiple conditions) tend to show bigger effects than mixed designs, likely because repeated exposure makes the scarcity cue more noticeable.
What this means for marketers (practical takeaways)
- If you sell experiences: consider supply-based scarcity (limited seats, limited release, limited slots).
- If you sell practical, functional products: demand-based scarcity cues are often the best bet (selling fast, popular, running low).
- If you sell higher-stakes or more “special” purchases: supply-based and time-based scarcity can be stronger than demand-based.
- If the product is about status and being seen: supply-based scarcity tends to outperform demand-based.
Where the paper says research is still thin
They flag gaps worth testing in real life, like:
- What level of “empty shelf” is optimal before it starts to look like poor stock management?
- At what point does a “limited edition” stop feeling exclusive because too many units exist?
- How time windows should be set (and what happens when retailers extend deadlines)
- More field studies and real purchase behaviour (a lot of research measures intent, not actual buying)
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