eBay Selling Strategy #2 - The Scarcity Perception
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Using Perceived Scarcity As A Selling Strategy
You've just heard of a great deal that you can get on ladies Ralph Lauren
Polo shirts. You know that they sell every day on the Ralph Lauren website for
$85.00. You can get 100 of them for $25.00 each, that's more than 65% off of the
retail price. You are so excited!
You think that with this purchase your eBay business will really be off and
running. So you purchase the shirts and put them up on eBay with a starting
price of $24.99. You're sure that will entice bidders to get actively involved
and bid the shirts up to at least half of the retail price.
And them you wait
. And wait. At the end of the seven days you
find that out of the 100 polo shirts you listed, exactly eleven sold. And they
all sold for the starting bid of $24.99
In the thought processes that surrounded your wholesale purchase of the
shirts you did not take into account how best to introduce them into the eBay
The perception of scarcity is a driving force behind the auction sales on
eBay. The idea that there is not enough of what you are selling to go around.
More so than in traditional retail venues and even more than the other selling
formats eBay offers.
The whole 7 day auction process is set up in a way that allows sellers to
benefit from competition among bidders. How often have you heard of someone
buying an item at a garage sale or closeout store and later selling it on eBay
for many times more than they originally paid?
It's likely that more than one bidder wanted the item, recognizing some value
in it, and then got into a bidding war with one or more of the other bidders.
Nothing drives up the final cost of an auction more than the idea in a bidders
minds that they are going to lose out.
A former employee of mine told me that I was successful at getting my
employees to do what I wanted because I played the "Take it away" game
with my staff constantly. I assured her that if I did it was quite unwittingly
because I wasn't even aware of what I was doing.
Apparently the "Take it away" game goes like this: I would ask an
employee to do some task and if the employee balked or in any way showed any
resistance or unwillingness to do what I asked, I would follow up by voicing a
concern that maybe we had given the employee too much responsibility and maybe
we should cut back on the duties they were assigned and assign them to someone
The employee would then usually do what I asked and more. Apparently, the
threat of having less responsibility was enough of an incentive to get the staff
member motivated again. I was honestly shocked that this "game" had a
name as I was earnestly trying to make it easier on the overworked employee and
keep this situation from reoccurring.
Anyway that story was a long way round the barn but the point is, if you
present someone with an opportunity to acquire or hold on to something, and then
they see the opportunity begin to slip away they are usually much more motivated
to hold on than they were before the threat.
And so it is with online auctions. The reality is, loss is a better motivator
than gain. So although there are tons of people who love Ralph Lauren polo
shirts if there are 100 of them on sale at any one venue then the perception is
that there is no rush and in fact they are perceived as a lot less valuable than
if there were only one or two on sale.
And when you think about it one of the reasons that they can sell at full
price on the Ralph Lauren website is because you only see one model in it. You
are not shown know how many he has in inventory. Unlike eBay, where each
occurrence of any item comes up in the search results. I bet those same Ralph
Lauren polo shirts wouldn't sell as well on the website either if we knew there
were 19,765 of them in stock.
So how do you sell 100 pieces of a single item on eBay? Here are some tips
that may help you.
1. List the items on auction a few at a time. In the case of the polo shirts
you could list one of each of the colors varying the sizes. This way it doesn't
look like so many of the same item is up for auction at one time.
2. Research eBay's Completed Items to determine the highest successful Buy It
Now price that has been paid for the items and sell them as Buy It Now Fixed
Price items. Scarcity does not come into play as much with Buy It Now items but
you have to be prepared to either receive less than you would in an auction with
healthy bidding or include a compelling reason for someone to purchase at the
price you are looking for. There are ways to do that, which we will be examining
in the future.
3. Build customer loyalty through providing exceptional customer service.
This almost goes without saying but people will pay more from a seller they know
and like doing business with than someone that they do not know and trust. You
should ask customers to add you to their Favorite Sellers list in every auction
that you list. The Favorite Sellers list is maintained in their My eBay pages.
Give a little extra with every sale, add a freebie in their shipment, a coupon
for 10% off of their next purchase from you. Even if you can't offer anything
concrete, dazzle them with super-fast shipping or even a shipping upgrade in
4. Open an eBay store and promote it like mad. Listing that stock of shirts
in an eBay store will also make them available to Google's Froogle search
results thereby expanding the potential market for your product exponentially.
5. Which leads naturally to the next option which is offer them on other
auction sites. eBay is the biggest but by no means the only auction site that
you can offer your items on. And now by implementing data feeds you can easily
get your eBay items into other venues