Scarcity Frenzy

Sales of the new PlayStation 3 start today. In fact, the front page photo on the Rocky Mountain News shows a group of guys who've been camping out in front of a Best Buy store since Wednesday evening.

On the front page of the Business section, there's a photo of a guy who's been camping out since Tuesday evening.

Why all the fuss? Of course, there's the excitement about how fun the PS3 will be to play, but the greater factor is the scarcity.

Apparently, most stores across the country have fewer than 20 units. In California, a Wal-Mart had to shut down when fights broke out.

Also of note: many of the people in line aren't gamers at all. They're profiteers. "Scalpers," for lack of a better word. They hope to "flip" their PS3's for profit on eBay. (Hey, wait a minute, I could sell an info product called "PS3 flipping." :-)

Anyway, I point all this out because scarcity is a powerful pyschological motivator. The more you can use genuine scarcity in your sales letters, the better.

The key is to make it genuine. Be specific and be real. One of the best promotions I ever did (in terms of total units sold) was for a puzzle. The reason it did so well was because I used real, specific numbers to demonstrate the scarcity.

And I didn't stop by telling subscribers how many units we had in stock. I also told them how many people were being notified. And which stores were already out of stock. Most folks don't know what typical response rates are, so the people on the list automatically assumed there would be a fast blow-out.

The Rocky Mountain News reports, "Low supply and high demand cooked up a powder-keg of interest in the PlayStation 3 this week as gamers and profiteers packed the front of stores across the country for a chance to buy the new console."

Low supply + High demand = Record sales

It's a simple formula, but it works beautifully every single time.

UPDATE 10:09 A.M.: I'm not the only one blogging about the PS3 as a great scarcity play. Christopher Knight of Ezine Articles just wrote a blog post about the very same thing. Read Mr. Knight's PS3 comments here.