Hurry Up and Enjoy It

Good article in The Atlantic entitled The Gift-Card Economy. It address how people react differently to behaviors depending on the timing. It's a good example of the Power of Scarcity.

Here are some quotes:

“While individuals given a longer time frame are more positive about and expect to be more likely to complete an enjoyable task, they are actually less likely to do so,” the behavioral economists Suzanne B. Shu and Ayelet Gneezy write in an article under review at the Journal of Marketing Research.

Shu and Gneezy then ran the experiment in real life, with a different group of 64 undergraduates. Half the participants got certificates good for three weeks and half for two months. Both groups were far less likely to cash in their cake coupons than predicted. And contrary to predictions, the shorter deadline encouraged more indulgence. Ten out of 32 people redeemed the three-week certificate; only two of 32 used the two-month pass. Those who redeemed their certificates said they’d enjoyed themselves, while those who didn’t said they regretted letting the deadline slip. They gave reasons like “I was too busy and ran out of time” or “I kept thinking I could do it later.” The pressure of a shorter deadline encouraged people to stop procrastinating and enjoy themselves.

To lure customers, Shu says businesses need to provide “a justification and a deadline,” citing Disneyland as an example. The park promotes a visit as “a special occasion” for creating lasting memories—exactly the sort of experience that Kivetz’s work suggests people value in retrospect—and it also gives visitors a free pass on their birthday. “They’ve convinced people to take advantage of that special occasion, and bring other people along,” notes Shu.

Like Disneyland, luxury retailers have long had to figure out how to overcome customers’ natural inertia. Unlike less pricey stores, they tend not to attract idle browsers who make impulse purchases. “You may only see customers a couple of times a season,” says Michael Calman, a luxury-retailing consultant and former senior vice president for marketing at Bergdorf Goodman. “You’re looking for ways to increase that visit rate.”