Scarcity Creates Impact
via rick
I’ve been toying with an idea for the past few weeks, but up until now it’s really just been the headline of this post. Then I read the excellent SAMBA blog and found they put into words what I had been struggling to say.
When something is scarce, it increases in value. If it’s not easily accessible, then it will be flooded with interest once it is available – basic supply and demand.
And so is the case with the internet – it completely throws the concept of supply and demand into a state of disequilibrium.
The internet is always in HIGH supply, regardless of demand. The SAMBA team goes on to point out that:
“Sometimes you get to decide how scarce something is. By creating scarcity you can increase the value.”
What can brands learn from this?
In a world where accessibility is so widespread, the answer isn’t always to make yourself available 24/7 – it’s to make yourself scarce. As Erin recently pointed out, brands should create enough engaging content to make consumers seek them out. It’s the Push vs. Pull idea.
Digging a little deeper
This talk of scarcity got me thinking about the last MAS assignment I worked on for the NYTimes.com. This post on The Grand Unified Theory On The Economics of Free had a great analogy of the recording industry using the concept of infinite vs. scarce.
I’m going to trying to use the same idea for the NYTimes.com (my focus is on the website – not the newspaper).
1. Redefine the market: The benefit is high-quality journalism.
2. Break the benefits down: Vetted news sources, bestseller lists, visualization charts, videos, etc.
3. Set the infinite components free: Post the news on social networks, open up the archives completely, stop asking people to register on the site, make the news as accessible as possible while promoting the journalists (not the brand) who create this content.
4. Charge for the scare components: Access to journalists, access to the newsroom, access to the creation of the content, merchandise, charge other news sources for access to these journalists.
“The end result really is a much bigger market with much greater benefit by expanding the market by using infinite goods to make the scarce goods more valuable…It’s very much about showing the key trends that are impacting all infinite goods — and pointing out a clear path to benefiting from it (while making life more difficult on those who refuse to give up their old business models).”
Not sure if I’m onto something here, or way off. The newspaper industry is a special case – it faces numerous challenges and there’s no easy answer. Even so, maybe this approach is a step in the right direction.
Thoughts?
