Sell More By Setting Limits....

Want to sell more of your product or service? Set a limit on what your customers can buy. Really! I know it sounds counterintuitive, but research indicates that setting limits actually makes consumers buy more than they otherwise would.

For instance, in a field study by the University of Illinois, shoppers grabbed 3 or 4 cans of soup when it was advertised on sale with no limit. When the the ad read "limit 9" people bought twice as many -- an average of 7 cans each!

Why is that? Much the same way a deadline creates a sense of urgency and gets consumers to "buy now", setting limits creates a sense of scarcity and gets consumers to "stock up". Also, by setting a limit, you create a sense that this discount is really a great deal and that you must set limits to avoid being overwhelmed with demand. But you'll notice in the field study, the price never actually changed.

Although sales doubled for the researchers, this won't always happen. Obviously the limit you set has to be realistic and stretch the customer, without seeming overly generous. I suggest you begin by determining the average quantity historically purchased at a sale price and then set a limit at 50% more than that.

The same limit-setting technique that works in consumer marketing, works in business-to-business marketing. I once used this technique with a slight twist to market an entrepreneur course in partnership with University of Illinois at Chicago. The postscript on the direct mail letter read: "For the best learning environment, class size is limited. So, contact us immediately..."

What can you do to set limits and encourage customers to act quickly?

- Phil Sasso