Scarcity refers to a real or perceived lack of certain resources that individuals use to meet their needs and desires (Hamilton et al., 2019). It may take a wide variety of forms, such as scarcity of money, time, food, and products (Cannon et al., 2019; Liang et al., 2021). Research has shown that scarcity attracts individuals’ attentional focus toward a certain resource that is lacking (Mullainathan and Shafir, 2013; de Bruijn and Antonides, 2022). In addition to shifting attentional focus, the experience of lacking sufficient recourses triggers a general sense of scarcity, which regulates people to accommodate the discrepancy between their current and desired states (Cannon et al., 2019).

Marketers may strategically create scarcity by limiting the quantity or the time availability of products (Cialdini, 2001). Such scarcity is often communicated to consumers through scarcity appeals, which entail the communication of the limited availability of advertised promotions (Shi et al., 2020). These strategies are often effective such that product scarcity increases perceived value and desire for the product (Gierl and Huettl, 2010). However, an important distinction should be made between two types of product scarcity: scarcity due to high demand (e.g., “nearly sold out”) and scarcity due to low supply (e.g., “limited editions”). Consumers tend to make different inferences about product scarcity due to excess demand versus restricted supply; consequently, consumers respond differently to demand versus supply scarcity appeal (Roy and Sharma, 2015).

Scarcity due to excessive demand leads consumers to infer that a product is popular because others have already bought the product (Roy and Sharma, 2015). Furthermore, inference about popularity may readily activate the scarcity-is-good heuristic, which can be described as “If everyone is trying it, it must be good” (Worchel et al., 1975). As a result, when product knowledge is limited, consumers adopt products that others acquire and are scarce for that reason. Thus, demand-based scarcity appeals may be used to signal popular consumption, especially for people who seek conformity (Roy and Sharma, 2015). Scarcity due to limited supply implies that the number of potential consumers of the product is restricted from the beginning because marketers control product distribution decisions (Aguirre-Rodriguez, 2013). Consequently, acquiring a scarce product of this type can express uniqueness and signal high social status (Gierl and Huettl, 2010). Thus, supply-based scarcity is especially suitable for luxury goods and may readily serve as status signals (Jang et al., 2015).

Previous work suggests that whether scarcity has positive effects on purchase intentions depends on consumption contexts and consumer characteristics. An evolutionary approach proposes and provides evidence that romantic desire drives scarcity appeals to be more persuasive and fear makes scarcity appeals less persuasive (Griskevicius et al., 2009). Developmental research found that scarcity preference only appears in an individualist society but not in a collectivist society (Diesendruck et al., 2019). Although these studies did not specify the concrete type of the scarcity, the source of scarcity is the low supply rather than the high demand. In the luxury market, supply-based scarcity (i.e., limited edition) advertising is effective only for socially visible (vs. invisible) luxury products and for consumers in emotional (vs. cognitive) consumption contexts (Tseng et al., 2021). In the food and beverage industry, limited edition packages lead to lower purchase intentions unless people have a high need for uniqueness (Dörnyei and Lunardo, 2021). However, the abovementioned studies did not compare the two types of scarcity.

A comparison of the effects of demand- versus supply-based scarcity demonstrates that consumers’ responses depend on product types, consumption target, and consumer characteristics. Supply scarcity appeals are more effective in creating positive consumer attitudes toward conspicuous products, while demand scarcity appeals are more effective for non-conspicuous products (Gierl and Huettl, 2010). In the online retailing context, when purchasing for oneself, supply-driven scarcity cues outperform popularity cues (which imply high demand) in eliciting purchase intentions; conversely, when purchasing for someone else, popularity cues are more effective (Wu and Lee, 2016). Prevention-focused consumers are more likely to purchase a scarce product due to demand than due to supply, whereas promotion-focused consumers are more likely to purchase a scarce product due to supply than due to demand (Ku et al., 2012). In an online booking context, demand scarcity appeal leads to higher purchase intention than supply scarcity appeal among consumers with a high sense of power; in contrast, such a difference is attenuated among consumers with a low sense of power (Huang et al., 2020). Most relevant to the current research, consumers with low levels of need for uniqueness prefer demand over supply scarcity appeal, whereas consumers with high levels of need for uniqueness prefer supply over demand scarcity appeal (Roy and Sharma, 2015).

Need for uniqueness is defined as the desire to pursue differentiation from others, thereby motivates consumers to prefer products that promote distinctiveness (Snyder, 1992). Limited supply conveys the information that few people can acquire the product, irrespective of the number of consumers who are craving for it. Thus, scarce products due to limited supply can convey one’s distinctiveness, which is especially appealing to consumers’ need for uniqueness (Gierl and Huettl, 2010). As mentioned above, Roy and Sharma (2015) found that need for uniqueness moderates the relative effectiveness of demand versus supply scarcity. Thus, we aim to conceptually replicate the findings of Roy and Sharma (2015). Specifically, we hypothesize that:

Need for uniqueness moderates the effect of such that supply scarcity is more effective than demand scarcity for people with high need for uniqueness whereas demand scarcity is more effective than supply scarcity for people with low need for uniqueness (H1).

We extended the previous research in three ways. First, we matched both the objective and subjective scarcity level between the two types of scarcity appeals. Second, we manipulated need for uniqueness in addition to measuring it as a personality trait. Third, we further examined the mechanism of perceived product uniqueness.

Scarcity preference seems inconsistent with the premise of economic rationality because consumers act on the perception of irrelevant context cues (scarcity) and not of fundamental cues (objective attributes of the product, such as quality; Mittone and Savadori, 2009). In addition, a robust preference for scarce resources can be observed as early as age 5 years old (Ferera et al., 2020). Researchers propose several mechanisms through which scarcity is expected to exert a positive effect on consumers. For instance, commodity theory suggests that people value a commodity more when it is difficult to obtain or is even unavailable (Lynn, 1991). Meanwhile, signaling theory suggests that limited availability can signal high quality (Stock and Balachander, 2005) and/or high status (Gierl and Huettl, 2010) to potential consumers. However, commodity theory and signaling theory may not fully explain scarcity preference because it emerges at an age when individuals are incapable of understanding how market dynamics affect object value (Ferera et al., 2020) and even when scarcity is detached from any status symbol effect (Mittone and Savadori, 2009).

Another account links scarcity preference to self-related motivations, in particular, people’s need for some degree of uniqueness (He et al., 2010). When acquiring a scarce product, consumers perceive themselves as distinct from the mass. However, the uniqueness explanation may apply to supply-based scarcity better than demand-based scarcity (Diesendruck et al., 2019). Demand scarcity occurs when, even though the supply is abundant, the demand is so great that few of the products are left. Thus, demand scarcity implies that the product is highly popular and is less likely to satisfy the need for uniqueness (Roy and Sharma, 2015). In contrast, supply scarcity implies that the number of potential consumers of a product is restricted from the beginning of the market process (Gierl and Huettl, 2010). Thus, possessing such exclusive products can achieve and express uniqueness. Empirical research suggests that scarcity cues lead to higher level of perceived product uniqueness compared to popularity cues (Wu and Lee, 2016). In the previous research, popularity cues implied high demand, though whether the product is scarce was not clearly pointed out. Based on these propositions and findings, we hypothesize that:

People perceive greater uniqueness for supply-based scarcity than for demand-based scarcity (H2).

We extended the previous work (Wu and Lee, 2016) by holding the scarcity level constant such that the observed differences between conditions could only be attributed to scarcity type rather than the extent of scarcity.

Although people have a need to differentiate themselves from others, they also need to maintain a certain level of similarities (He et al., 2010). In addition, some consumers value exclusivity or uniqueness (i.e., snobs), whereas others value conformity (i.e., followers; Amaldoss and Jain, 2005). Consequently, supply scarcity and the proposed higher uniqueness perception may not always increase purchase intention. High uniqueness perception may increase or decrease purchase intention, which depends on consumers’ need for uniqueness (Roy and Sharma, 2015). Thus, we propose the following hypothesis:

The effect of scarcity type on purchase intention will be mediated by perceived uniqueness and then moderated by need for uniqueness (H3).

Specifically, supply-based (vs. demand-based) scarcity messages increase uniqueness perception, while perceived uniqueness increases purchase intention for consumers with high need for uniqueness. However, this uniqueness perception reduces purchase intention for consumers with low need for uniqueness. Prior work provides indirect evidence for our hypothesis. However, no study has tested the whole model directly.

Three studies tested the hypotheses. We piloted the two types of scarcity appeals to ensure they led to the same level of scarcity perception. Study 1 manipulated the need for uniqueness via a sentence unscrambling task and examined the interactive effects of supply- versus demand-based scarcity messages and need for uniqueness on purchase intention (H1). Study 2 compared the effects of supply- and demand-based scarcity messages on perceived uniqueness (H2). Study 3 examined the effect of scarcity type on purchase intention via perceived uniqueness while using measured need for uniqueness as the moderator of the effect of perceived uniqueness on purchase intention (H3). We used the PROCESS macro for SPSS to allow for mediation testing with bootstrapping; Model 15 is used for moderation and second-stage moderated mediation (Hayes, 2013).

The results from Study 1 confirmed the moderating role of need for uniqueness in the effect of the scarcity appeal on purchase intention. When consumers’ need for uniqueness was primed by sentence-unscrambling manipulation (vs. control), their purchase intentions for the supply-based scarcity product were higher than the demand-based scarcity product. These results supported H1.

Study 2 tested the effect of scarcity appeal type on peoples’ perceived uniqueness. Consumers perceived the product as more unique when the scarce product was supposed to be supply based than demand based, thus supporting H2.

The results confirmed that the need for uniqueness moderated the effectiveness of different types of scarcity appeals. Supply-based (vs. demand-based) scarcity increased consumers’ perception of uniqueness. Perceived uniqueness increased the purchase intention of consumers with high need for uniqueness. Hence, H3 was supported.

The current research offers several theoretical contributions. First, this research contributes to the literature on scarcity by highlighting the distinct impacts of supply scarcity and demand scarcity on purchase intentions. Prior research has examined the effects of product scarcity on consumer preferences (Jang et al., 2015), the origins of scarcity preferences (John et al., 2018), and the negative effects of scarcity promotions (Kristofferson et al., 2017). Researchers also examined the differential effects of limited-time scarcity (LTS) and limited-quantity scarcity (LQS) messages on conspicuous and non-conspicuous products (Jang et al., 2015). Complementing this line of research, our research makes a distinction between different sources of scarcity, namely supply induced and demand induced. This research found that consumers do differentiate between the two types of scarcity, even when the extent of scarcity is actually the same.

Second, the current research contributes to recent findings on limited-edition promotions (Tseng et al., 2021) by suggesting that supply-driven scarcity is not always effective for promoting sales. We identify need for uniqueness as a moderator of the effectiveness of supply- (vs. demand-) driven scarcity on consumers’ purchase intentions and provide process support to the mechanism. Previous works have largely focused on positive outcomes (e.g., desirability) of limited-supply scarcity appeals (e.g., Aguirre-Rodriguez, 2013). Meanwhile, recent research has identified boundary conditions under which consumers react positively to supply scarcity appeals, such as the social visibility of the product (Tseng et al., 2021) or consumers’ sense of power (Huang et al., 2020). In addition, Roy and Sharma (2015) found that consumers high in need for uniqueness trait prefer supply over demand scarcity appeal. The current research replicated the moderating role of need for uniqueness and extended the previous work by ruling out different level of scarcity as an alternative explanation. Moreover, the research suggests that supply scarcity increases purchase intentions when consumers are dispositionally and/or situationally high in need for uniqueness.

Finally, this work provides evidence for the process driving the differential effects of supply versus demand scarcity. Specifically, an important inference that consumers draw from supply- versus demand-based scarcity is the uniqueness of the product, which sequentially increases or decreases purchase intentions depending on consumers’ need for uniqueness. Previous research has shown that supply-driven scarcity messages influence consumer competition (Kristofferson et al., 2017), perceived quality (Gierl and Huettl, 2010), and risk perception (Huang et al., 2020). Another research found that supply-side scarcity appeals lead to higher perceived uniqueness than popularity (i.e., high demand) appeals (Wu and Lee, 2016). Our research further matched scarcity level and showed that scarcity type (supply versus demand) itself is enough to elicit different levels of uniqueness perception, which positively or negatively influence purchase intention. Thus, the current research adds to the scarcity appeal literature by highlighting uniqueness perception as a mechanism that encourage or discourage consumers to purchase supply scarce products.

The current research provides a hint for marketers on how to select the suitable scarcity appeal. Specifically, our findings alert marketers that the effectiveness of different scarcity appeals varies as a function of consumers’ need for uniqueness. The results reveal that a supply-based scarcity appeal is more effective than a demand-based scarcity appeal for consumers with high need for uniqueness, whereas a demand-based scarcity appeal is more effective than a supply-based scarcity appeal for consumers with low need for uniqueness. Therefore, marketers need to segment and target consumers with different levels of need for uniqueness using different types of scarcity appeals. On the one hand, marketers may attempt to capture consumers’ behavior patterns and segment consumers on the basis of the predictors of need for uniqueness. On the other hand, marketers may also activate consumers’ uniqueness desire through situational primes (e.g., advertising slogans). Thus, increased need for uniqueness combined with supply-based scarcity appeals can effectively boost purchase intentions. In contrast, when consumers’ need for uniqueness cannot be identified or primed, a safe strategy is to implement demand-based scarcity appeal.

Our research has limitations that may open avenues for future studies. First, to make the situation familiar to most consumers, we used a common product (i.e., shoes). However, the findings may not be generalizable to the wide variety of products and services. In addition, we refrained from designating specific brands for the product. This endeavor had the advantage of avoiding the confounding effects of preexisting brand knowledge and preferences. However, it also deterred us from exploring whether the current findings differed in terms of brand concepts, such as conspicuous versus non-conspicuous products, symbolic versus functional products, and hedonic versus utilitarian products (for a review, see Shi et al., 2020). Research has suggested that limited-quantity (vs. limited-time) scarcity messages affect purchase intentions more for a symbolic brand than for a functional brand (Aggarwal et al., 2011). Furthermore, we used hypothetical scenarios and measured purchase intentions, which are not equitable to actual purchasing in real situations. Future studies are needed to enhance the generalizability of our research.

Second, our work focused on examining the moderating role of need for uniqueness in the effectiveness of supply (vs. demand) scarcity appeals on purchase intentions. Future studies need to explore other potential moderators. For example, the three dimensions of need for uniqueness (i.e., creative choice, unpopular choice, and avoidance of similarity) were found to influence bandwagon and snob luxury consumption differently (Das et al., 2021). Desire for exclusivity, which emphasizes consumers’ desire to express superiority over others via consumption (Kim, 2018), may drive preference for limited-edition status consumption. Clues about other consumers’ behaviors (e.g., demand scarcity) appeal to consumers from a collectivist culture, whereas clues about uniqueness (e.g., supply scarcity) appeal to consumers from an individualist culture (Huang et al., 2020). Hence, these factors are likely to moderate the effects of different scarcity appeals.

Third, our research mainly focuses on perceived product uniqueness as the mechanism underlying the effects of supply (vs. demand) scarcity and need for uniqueness on purchase intentions. Prior work has found that supply scarcity appeal and demand scarcity appeal engender distinct inferences, such as differences in product quality (Gierl and Huettl, 2010) or perceived competitions among consumers (Aggarwal et al., 2011). In addition, consumers might perceive supply scarcity as artificial if they believe that a company deliberately limits the supply (Hamilton et al., 2019). Future research may examine these additional potential mechanisms, which drive the interactive effects of scarcity type and need for uniqueness.

To conclude, the current research showed the distinct impacts of supply scarcity and demand scarcity on purchase intention. The current findings provide theoretical implications on how scarcity shapes consumer responses and practical implications on how to target consumers with different levels of need for uniqueness.