How can your ecommerce store use urgency – aka the fear of missing out or FOMO – to increase conversion rates?
All’s well and good if you have limited inventory – you can just use your inventory management / order management system to specify how few products are left, on product detail pages. But what if you have a large stock of goods, or the type of goods that doesn’t change much seasonally (e.g. microwave ovens)?
What can you do to get the conversion now and avoid a delay in purchasing — which often just means no purchase at all?
Here are three techniques to create urgency and close the sale now.
[Click here to get additional conversion rate optimization resources, such as my 8-point cheat sheet for maximizing mobile conversion rates, and my talk on conversion-centered redesigns at Magento Live.]
When you launch a new product line, a new store, service, feature etc – it’s important to get the word out.
People understand this concept, so provided that it applies, you can announce your sale for opening weekend, or for the first month etc.
Keep in mind that to maintain your credibility, the “introductory pricing” can’t last too long or you’ll hurt your value perception and not achieve the feeling of urgency that boosts conversions.
I noticed such a negative impact on value perception with a local brand orange juice that was introduced at the supermarket for 30%-40% less than competitors.
The supermarkets eventually raised the price to only be 25% off, but after a brief period within 10-15% off, they returned to 25% off. It appears that people got used to the discount and preferred the ‘better’ brands of orange juice when the difference in price was less marked.
Event Linking and Deadlines
If your offer is linked to an external event – like the start of a course or the arrival of a holiday, you can use that to introduce urgency.
Back to school shopping is obviously urgent because, well, kids need school supplies before they return to school!
Another example is that retailers can state a deadline by which customers must order to ensure that the product arrives on time (e.g. before Thanksgiving).
There’s a variation on this, which is applicable year-round. Invite visitors to buy before a certain time, to get the product shipped that same day and save themselves a day of waiting.
This sort of event driven deadline is plausible and has the added benefit of relating to customers’ goals, i.e. have the gift in time for the occasion.
Another twist on this is with a reverse-inventory system practiced by some retailers, where products are only ordered from wholesalers after the retailer sells them. You can see this in some discount clubs or crowd-funding on platforms like Kickstarter.
Buyers must buy before the deadline, because the order eventually has to be sent to the suuplier. They’ll only send a bulk order, and not tack on another unit two weeks later.
Impending Price Increase Due To Supply and Demand
When supply decreases or demand grows, there’s an increase in price. That’s economics 101 – the law of supply and demand.
So what happens if you get a big boost in traffic, such as from success with public relations, social media outreach to big stars, or you simply intend to launch a big ad campaign?
In economic terms, that’s a big increase in demand. AkA a reason for the price to go up.
At that point, you can email your client list to ‘warn’ them about the impending rise in prices. As a favor to your newsletter subscribers, you’d like to give them a last opportunity to buy at the current price before the price goes up.
Telling visitors about the high demand for your product and possible waiting times is another effective urgency-builder. These coffeemaker ads from 1938 sold countless machines, partly thanks to this tactic.
Another variation on this is if you’re making your product more valuable with a new feature, then it’s legitimate to charge more.
Offer ‘old pricing’ until a certain deadline.
If you’re not selling something with a limited inventory, you can still press customers to buy now with the following techniques:
1) Offer introductory pricing for a new product, line, service, store etc. We’re excited to launch!
2) Tell visitors that they need to buy noew to get the product shipped to them on time for a certain event, holiday or deadline
3) Tell existing customers or leads that the price is going up soon because demand is increasing.
Click here for additional conversion rate optimization resources, such as my guide to getting usability testing done at 70% off the price of sites like UserTesting.com, or my 8-point cheat sheet to the optimal mobile checkout.