The Scarcity Principle in Action: Understanding the Psychology of UX Design
UX Design
April 27, 2023
4 mins read
The Scarcity Principle in Action: Understanding the Psychology of UX Design

How does the scarcity principle work?

How often have you scrolled through Amazon and landed on today’s deals?

ux scarcity principle by amazon
amazon deals page

Source: Amazon

How often have you clicked on it?

The designers at Amazon and hundreds of other brands are using the scarcity principle. The scarcity principle is one of the most effective ways to convert users into customers. This article will discuss:

What is the scarcity principle?

The scarcity principle refers to the idea that people will buy more when something is promoted as being in short supply. If a product is promoted as being scarce in terms of time, availability, or quantity, then the desire to obtain it increases. Users will often buy the product on impulse, thus leading to faster conversion rates.

This is often used in marketing campaigns and advertisements. A recent real-life example includes people buying a lot of toilet paper during COVID-19. This can be understood with simple economics too. That is, when the supply of a product decreases, the demand increases.

It is most commonly used in eCommerce or booking websites where a "sale ends in 2 hours" or "2 items left in stock."

How scarcity principle works infographic
how does scarcity principle work

The scarcity principle works on three important cognitive biases:

Loss aversion

People buy a product if it is scarce to avoid losses. The pain that follows a loss is perceived to be greater than the pleasure that follows a gain. For example, special occasion deals like Black Friday Sale or Independence Day Sale lead more users to buy a product to avoid loss of getting the product at a cheaper price.

loss aversion in website design to buy in myntra website
myntra deals page

Source: Myntra

Anticipated regret

Otherwise known as FOMO, people anticipate regret if they miss out on something or make the wrong decision. According to a study by Eventbrite, 69% of millennials (who also have purchasing power)  experience FOMO. Regret often follows after we have missed out on an opportunity or taken the wrong decision.

Users predict that they will regret not buying a limited-stock item if the item goes out of stock in the future. This urges them to buy the product. For example: WhiteHat Jr shows copy “Limited Spots Left” for their coding classes.

FOMO experience user behaviour in scarcity principle
whitehat jr enrollment page

Source: White Hat Jr

Social proof

This refers to the phenomenon when people who don't know what to do would turn towards others to guide their next action. A tourist will look at a queue and stand there to buy a ticket or teenagers will copy the next trendy outfit promoted by social media influencers.

In websites and apps, messages like testimonials, positive reviews, or how many people bought a product and similar products are all examples of social proof. One of these websites is Udemy that showcases testimonials of learners.

social proof like testimonials, positive reviews in buying psychology

Source: Udemy

How ethical is the scarcity principle?

The scarcity principle is one of the many principles of persuasive design practices. The persuasive design uses these cognitive biases and behavioural science to influence decision-making.

It meets the goals of users and businesses by giving cues for a faster decision-making process. The question of ethics comes into the picture when persuasive design becomes deceptive design where information is deliberately hidden like hidden costs, shaming users to buy a product, or use of false testimonials. 

Overdoing the use of the scarcity principle can also be dangerous. For example: If a sale deadline was today, but it continues tomorrow and the day after, users can feel betrayed.  They will lose their trust. If they felt pressured to buy the product, they will seek a return, refund, or write negative reviews. All of this can make them never buy the product again.

How can I use the scarcity principle in UX design?

1. Give honest, limited-time offers

scarcity principle nykaa offers and discounts
nykaa offers page

Source: Nykaa

2. Create a sense of urgency in copies through words like instant, hurry, now, soon, close, fast, and today

creating urgency hack in buying
bigbasket offers page

Source: Bigbasket

3. Use a countdown timer for temporary discounts

countdown or timer for limited deals
countdown timer on courses

Source: Interaction Design Foundation

4. Use scarcity of quantity to show real-time stock shortages

scarcity of quantity to show real time stock
limited stock warnning

Source: Tata Cliq

Remember to always conduct A/B tests and usability tests to find out how users feel about these messages.

Conclusion

The scarcity principle makes us place a higher value on items perceived as scarce. This explains why luxury items like bags and cars get sold at higher prices even if they appear ordinary.

It is a powerful psychological principle that plays on cognitive biases and can be leveraged in UX design to increase conversion rates. Be it signing up, purchasing a product, or completing a task, it can urge users to take action. But it is essential to use this tool ethically and not deceive users.

In the end, the goal of UX design is to create useful, usable, and pleasant products for users and this principle can help in achieving these goals

Read More:

5 Key Factors to Consider When Choosing a UX Design Agency: Visual Design Expertise

6 Step Guide to Master Dashboard UX Design

Best UX Strategies for User Retention that Actually Works

A solution-driven person with a keen interest in solving problems in digital products through designing. I have worked with 15+ clients in successfully delivering digital products such as Saint-Gobain, HDFC, elgi Ultra, LuLu Group, IIFL, Stockal etc.. worked in 10+ digital products across domains such as Network security, Fin-tech, E-commerce, Healthcare, Recruitment, Real estate etc.. Research, Ideation, Wireframing, Designing, Prototyping, testing and delivery are my bread and butter.

Subscribe for Industry insights

Get cutting-edge design insights + Free pro
resources just for subscribing!

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.

FAQ

How does psychology play a role in UX design?

Psychology plays a role in UX design by helping designers understand user behaviour, motivations, and cognitive processes, allowing them to create interfaces and experiences that are intuitive, engaging, and satisfying.

What is the scarcity principle in UX?

The scarcity principle in UX refers to leveraging limited availability or time constraints to create a sense of urgency, motivating users to take desired actions or make decisions quickly.

What is the scarcity principle in UX?

The scarcity principle in UX refers to leveraging limited availability or time constraints to create a sense of urgency, motivating users to take desired actions or make decisions quickly.

Is it ethical to manipulate users by creating artificial scarcity?

Creating artificial scarcity to manipulate users is generally considered unethical as it deceives and exploits their psychological biases, undermining trust and fairness in the user experience.

What is risk vs loss aversion?

Risk aversion refers to the tendency of individuals to prefer avoiding or minimizing potential risks or uncertainties in decision-making. Loss aversion, on the other hand, is the cognitive bias where individuals tend to feel the pain of losses more intensely than the pleasure of equivalent gains, leading to a preference for avoiding losses over seeking gains