Jim's Marketing Blog

Marketing ideas to help you grow your business

What everybody needs to know about scarcity

I have a powerful question for you to ponder today.

It’s simply this: Where is the scarcity in your business… what do you provide, which is in short supply?

Scarcity creates value

When something is in short supply and there is a requirement for it, its value increases. For example, a bottle of water can cost pennies at your local town (where there are lots of other stores selling water.) That same bottle of water could cost you 2 or 3 times as much, when bought at a theatre (where there is no competition).

One off

Most small business owners have 2 problems, because they fail to build scarcity into their products or services:

  1. People don’t talk about commonplace products or services. So, they attract few if any word-of-mouth referrals.
  2. People won’t pay a premium for commonplace products or services. This drives profits down. It also causes those who provide similar sounding products and services to compete on price – as price becomes the only way for potential customers to determine value.

I want you to avoid those problems!

Here’s a tip. It’s a simple exercise, to help you determine where your business fits into the scarcity scale. I want you to take some time out to think about your business, your competitors and your marketplace.

Then, I want you to focus on answering this question: ‘How simple would it be for my customers, to replace me with a competitor who provides a similar sounding service?’

Here are 3 posts, which will help you build unique value into your business. I hope you find them useful:

How to attract the best clients and the highest fees – Part 1.

How to attract the best clients and the highest fees – Part 2.

How to attract the best clients and the highest fees – Part 3.

About Jim Connolly: I help small business owners grow their business, make more sales and boost their profits. To see how I can help you and your business, read this.

5 Comments

  1. This is very important as need can only give you money otherwise there is no value.

  2. Its why we love your blog. You’re one of a kind Jim ;)

    Evie XxX

  3. This is good advice, Jim. It seems when it comes to customer service, it’s not what you do, but what you do differently that really counts. I can get a good night’s sleep at many hotels. But Ritz-Carlton provides a unique, remarkable, personalized experience. The level of service they provide is scarce. Which of course us why they can charge so much more! So many businesses never distinguish themselves because they try to be everything to everyone. The result is some diluted water-downed version that is very forgettable. As you say, scarcity creates value. Unfortunately, it seems most business owners are afraid to go to the edge!

    • Hi Patrick. You make a good point about the need for business owners to embrace ‘the edge’.

      The crowded centre ground is all about price. That’s a risky game to play, when Google shows us the cheapest provider in seconds.

      Thanks for the comment, sir.

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