Reward and Scarcity: How Psychological Traits Can Boost Your Company’s Sales

Back in my senior high school years, I’ve got a number of opportunities to become a committee of events held back then. As a committee, my responsibility also includes gathering participants for our event.

Of course, the only strategy that comes into my mind, also my team’s, is only to spread the event’s poster through other schools, hoping that they would register themselves immediately.

And, as a result, it was one hard time back then to gather hundreds of participants for our school’s big event.

As I entered my college years, I started to develop an interest in customer experience.

These learning processes make me realize that human’s brain is unique, yet complicated. We, as a human, may have different interests and needs, which make psychology a very broad subject to study.

Looking back at that time, I realized that a human’s brain can’t be bought with posters only. Human’s brain can be one difficult task, if we don’t know how to cope with it.

As I learned more about customer experience and a little bit of psychology in it, I started to develop an understanding that marketing is totally interconnected to customer experience. How we understand our customers is the key for the success of our marketing.

“You don’t find customers for your products. You find products for your customers.”

The Two Opposing Traits

I found out that human’s brain can be highly stimulated by two opposing traits, reward and scarcity.

Reward

When we were a child, our parents often gave us a challenge to make our bed every single morning after we woke up, with extra pocket money as a reward if we did our task.

Hearing that we would get a reward, we would just do the challenge, driven by the reward we will receive afterward.

Learning from our childhood behavior, I realized that humans are attracted to rewards. Research also shows that our neurons will release dopamine when we expect to receive a reward.

The brain’s response to rewards initializes the idea of The Reward Marketing, a customer-centered strategy to boost sales.

“Okay, but how to implement reward marketing to our business?”

#1 Point-based reward

Just like our nature, we also tend to be attracted to extra point rewards. For example when you finished your purchase on an online shop, and you were asked to give a review. I bet you won’t be that interested to share your thoughts for the product, except if it has a very good quality.

How about if I offer you an extra point that can be used for later purchase if you submit a review for the product you just purchased? It would be different, right?

#2 Referrals code

The referral code also uses the point-based reward system similarly. The difference is in the main goals. You can use referral code to attract more customers to buy your product by giving extra reward if they purchase your product with a special code that is referred by their friend.

Scarcity

On the opposite of reward, there is scarcity.

I will also create an illustration based on children’s behavior.

Some of us may have experienced how we were told to do our homework, or if not, we will get a punishment from our teacher. That sounded very scary for us back then, and because of that, we don’t have any other choice other than just do our homework well.

And yes, you are right! That experience also initializes the idea of The Scarcity Marketing, another customer-centered strategy to boost sales.

The scarcity marketing can also be implemented in boosting product sales through several ways.

#1 Limited system

Seeing that there are only 3 tickets left, it will boost customers to make a purchase immediately. They have no choice, as there are only 3 remaining tickets and they can’t wait any longer, or they would be unable to fly back to their own hometown.

#2 Countdown timer

When we see that there is only 1 hour left for an 80% discount offer in an online store, we’ll start to think fast to make a decision, whether we will purchase that item or not. And in most cases, with that interesting offer in a limited time, we can’t resist not buying that item.

These 2 opposing traits are just two out of hundreds of customer centered marketing approaches that you can implement to your business. Whatever marketing strategy that you will implement later, just make sure that you refer back to the key for marketing success, which is How we understand our customers is the key for the success of our marketing.