Limited-time offers: how to drive conversions with scarcity marketing

A time-limited offer is a promotion or campaign that takes place only for a certain period. It is an offer with a clearly defined end date and/or validity period. Usually, they take the form of sales, discount codes, free gifts, exclusive products, or anything else that is available only for a specified time. They are simple yet powerful tools that can turn undecided buyers into customers.

As someone professionally involved in online sales, you're probably well aware of how important it is for users to smoothly go through the entire purchase path until the final payment. To ensure the process is quick and efficient, you also realize that customers sometimes need a little push to make a purchase decision. Time-limited offers can be just those little nudges.

In this article, I will explain the concept of time-limited offers and show how they work. I'll provide some examples and tips on how to get started. A time-limited offer is one of the most effective tactics for driving conversions in your e-commerce. 

What is a time-limited offer? About scarcity marketing

Suppose you want to buy a new computer. You're in the store, in front of the model that perfectly meets all your needs. Moreover, it's available together with a set of Bluetooth headphones. The store is about to close, so you decide you'll come back tomorrow. At this moment, the salesperson informs you that this offer ends tonight. If you don't make the purchase now, the headphones will no longer be included in the set from tomorrow.

What do you do? Do you make a hasty purchase to save a few hundred on the headphones you've had your eye on for some time, or do you keep looking? There's a good chance that thanks to the time-limited promotion, you'll quickly become a buyer, not just a potential customer. After all, this is the computer you want; you're aware that the offer is exceptionally favorable. Why not decide to buy it today?

Like most people, you'll probably make the purchase and be pleased with yourself for making a bold decision and going home with a free gift. But that's only partially true. The electronics store motivated you to make a decision by creating a sense of urgency with a time-limited promotion.

Here are a few other examples of messages related to time-limited offers:

• The offer ends tonight at midnight
• Only a few items left in stock
• Offer limited to products in stock
• Offer valid while supplies last
• Order within one hour to receive delivery tomorrow

Time-limited offers are based on the principle of limited availability, which stems from behavioral economics. This concept was first used by Dr. Robert Cialdini. It is based on the concept of supply and demand. According to it, when a product or service becomes increasingly difficult to obtain, it becomes more valuable to potential buyers. Scarcity works in two dimensions: on one hand, it's related to limiting supply, and on the other, it builds increased demand. I think most of us know this firsthand when it was hard to get hand sanitizer or professional masks at the beginning of March.

Essentially, when something is limited, our brain tells us to acquire it (in this case, buy it) before it's too late. Every time you feel the fear of missing out (FOMO) and have the urge to buy something while it's available, you're feeling the impact of scarcity marketing.

Time-limited offers that drive conversions – examples

Before we talk about creating your own time-limited offers, let's look at a few proposals that have proven to be extremely effective.

To better understand how well time-limited offers work, consider one of the best examples: Black Friday. It's an excellent opportunity to introduce limited offers because the event lasts only one day. If customers want a discount, they simply have to go shopping on that specific day.

This concept worked so well that marketing specialists came up with another time-limited proposition: Cyber Monday. These two most popular days kick off a month-long shopping frenzy, which traditionally accounts for about one-third of annual retail sales. Everything is based on time-limited offers – December 26th is too late; all the gifts have already been opened, and stores are preparing for the return of unwanted presents 😉

Usually, a good Black Friday offer combines a unique promotion with a clearly defined time limit. Probably each of us encounters many such offers around the holidays. Attention-grabbing colors and countdown timers can further stimulate the sense of limited availability.

Let's look at the example below. In this commercial, the slogan "This is as cheap as we'll ever go" makes the customer's inner voice prompt: "You'll never save as much money as you do now!"

In the advertisement shown below, the phrase "limited time" is used, but no specific time frames are given. This approach can work in some cases. Because the end of the promotion is vaguely defined, the customer may feel under additional pressure, not knowing exactly when it will end.

What distinguishes this example is the free gift with the purchase of a specific brand's product. Instead of offering discounts or lowering the product price, the brand adds value to the buyer's purchase and additionally states its specific value.

The e-commerce platform Etsy largely relies on selling products using limited availability. The message in the style of "Only 1 available item, which is in X carts" creates a sense of urgency, thereby motivating new customers to make a purchase. If you often book hotels on booking.com, you probably know this well and have seen on the listing that the places you are interested in are already occupied or places in them may run out because one of the last places in that hotel has just been reserved.

Some offers have their own natural time limitations. Take, for example, this advertisement. If you want a product for the holidays, you must place an order by a specific date. Because these are organic offers, they have a strong impact. The time limit does not seem forced or artificial.

Best practices for time-limited offers

The concept of a time-limited offer seems to be quite simple, and it actually is. However, smart marketers use this tactic in many ways. Let's go through a few best practices that everyone can start with.

1. Use language indicating a time limitation

In copywriting, it's about using language that refers to limited time, for example, "one-day sale only," "sale ends at midnight," or "only for two days." Here are a few other tactics:

• Specify the duration: One-day sale at Macy’s
• Specify the duration and time: Today (June 17) is your last chance - the promotion ends at midnight
• Not just in relation to products: Free shipping - only this month
• Name things directly: Time-limited offer
• Emphasize that the offer is one-time: Only the last 5 items at this price 

Be very specific. Don't assume that recipients will understand that "Women's Day Promotion" means only Women's Day. Highlight the time limitation of the offer, for example, "One-day Women's Day Sale" 

2. Use time appropriately

Timing refers to the nature of the offer. Your campaign should be short enough for people to fear they won't be able to take advantage of it, but not so short that they can't reasonably make a purchase in time. For example, a one-day flash sale is a very good idea, but a sale lasting only one hour will likely go unnoticed by customers. Recipients need a bit of warning at the right time.

It's also a good idea to set a specific deadline so buyers know exactly when the offer ends. If you simply say: "Sale ends today," people may wonder what exactly that means. End of the workday? Midnight? In which time zone?

Office Depot provides specifics (down to the second) regarding a time-limited coupon for Black Friday. It's an unobtrusive way to advertise a discount without being obnoxious and scaring customers away.

Moreover, a time-limited offer doesn't mean you have to impose it on customers at the last minute. Your customers know you'll be offering something on Black Friday, so build anticipation and tension by informing them well in advance and often. Especially if you have a loyalty program and can use the sale period as a trigger for customers to finally have a concrete reason to join.

In reality, when the duration of the campaign is too short, people may actually be dissatisfied with the time-limited offer. Researchers from the University of East Anglia conducted an experiment intending to check and indicate what leads people to accept or reject such offers. Time-based offers were more often accepted when study participants had 12 seconds to make a decision compared to 4 seconds.

Essentially, if you urge people to make a decision right now, they will surely reject such an opportunity. But if you give them just a little time to think, they will be more inclined to finalize the transaction. 

3. Promote your ad everywhere

In ideal conditions, the best solution would be to tell as many people as possible, definitely the target group. This involves sending multiple emails, posting on social media, implementing retargeting campaigns, spreading the word among influencers, and every other marketing channel that, according to you, can attract the attention of your target group. 

4. Be creative in creating your offers

Time-limited offers are often used as part of larger discount strategies, but they don't necessarily have to take the form of price reductions. For a certain time, you can offer a free gift, free upgrade, special service, or access to a new product. For example: "All orders placed today qualify to participate in the draw for exclusive vacations in Spain."

RIPT Apparel is a clothing brand with a unique approach to time-limited offers. On their homepage, there's a section dedicated to "Daily Deals," which includes three limited designs at a reduced price every day. The designs change at midnight. Such an approach strengthens the sense of urgency. If customers don't make a purchase on a given day, they lose the chance to own specific designs. 

5. Focus on the benefits of the offer

A time-limited offer is simply the stimulus your potential customers need to make a purchase decision. However, remember that you still need an attractive offer that recipients will find valuable. The benefit should be the most prominent element of every offer.

For example, the offer in the example below from Sephora is available only during the holiday period. Sephora also highlights a free gift with the purchase of a product of the appropriate size. The customer may feel encouraged to buy a larger product than they originally planned to get something extra.

6. Do not rerun offers after they end

One of the things that can have the biggest negative impact on your reputation is misleading customers about the duration of "time-limited" offers. If a promotion is available often or, worse, all the time, your customers will not feel any "incentive" to take advantage of it. In fact, such misleading can turn against you.

Time-limited offers give a lot of room for creativity, but always remember one basic rule: If you say something, do it. If you ignore this rule, you may completely waste the chance to establish a long-term relationship with the customer. We all know the story of "closing sale" that never ends. Soon they become just a source of jokes. If your offers and promotions are dishonest or inaccurate, you risk losing the trust you've built among customers, which in turn may motivate them to visit the competition. 

7. Increase effectiveness through personalization

Time-limited offers are not limited to landing pages. They also work great in emails, especially if you combine them with personalization. Look how Barnes & Noble combines time-limited offers with products specially selected for the recipient.

8. Do not offer too many discounts

When you want to increase revenue, a tempting option is to introduce a sale. Sales are an easy way to significantly improve charts in the sales report, but it's hard to break away from them later. Too many sales can actually harm the business by drastically reducing the margin. Additionally, customers may expect even more sales, which in turn means they decide not to buy when there is no promotion.

Experiences show that many well-known brands implement such strategies for years, lowering their margin because they do not have an idea for an interesting and engaging loyalty program that customers would actually want to use regularly.

This does not mean, however, that discounts are always bad. Two or three a year will certainly not hurt.

One of the brands in the Polish market that uses this strategy, that discounts are only available in a specific time window, is the Kazar footwear brand.

They are also a useful tool for securing a high customer lifetime value (CLV) when selling at the profitability threshold.

If you do not know exactly how to calculate the profitability of customers using available data, contact Persooa.

9. Do not overdo it with pop-up windows

Once you've prepared a time-limited offer, you definitely want to inform all customers who visit your site about it. What's the point of organizing a promotion if no one knows about it, right?

Using pop-up windows to inform visitors about a great offer is fine. However, do not attack buyers with a pop-up window immediately upon entering your site. Give them a chance to at least familiarize themselves with your logo. The most effective pop-up windows do not appear immediately. They give visitors some time to view the site and strengthen interest in the offer.

How long should you wait before a window informing about a special offer appears on the screen? There is no one universal answer. The best solution is to conduct tests to determine the effectiveness of specific actions.

If you are unsure about the timing of presenting the pop-up with the promotion, you can always use the "exit intent" solution, which will show the appropriate discount to the customer when leaving the cart. A great placement for presenting is also bars on the site navigation, which you can show to the customer after entering a specific category. One of the latest ideas is also adding a special highlighter on the product category page.

Marketing using time-limited offers works

The best thing about time-limited offers is that they work. If you use scarcity marketing correctly, a time-limited offer will generate higher sales. It's just that simple. Few marketing tactics are as reliable as time-limited offers. That's why you encounter them all the time.