Harnessing Customer FOMO

“Nothing haunts us like the things we didn’t buy” – fashionchick.nl

With rising competition, shrinking markets, low customer attention span, and limited resources, every company is trying every ‘trick in the book’ to attract and retain the largest number of customers possible. One of the top ‘tricks’ is customer FOMO – fear of missing out – sneaky but necessary for survival. FOMO is a very potent form of social proof – everyone wants to have access to the most exclusive offers, be the first to buy things that are for a limited period, and possess those things that make us look and feel good. Marketers use customer FOMO to add urgency and excitement to their offers, making every offer seem irresistible and appealing such that customers buy significantly more.

Harnessing customer FOMO is necessary today – it captures and uses the value of perceived paucity of whatever customers want most. The fact is that customers have so many choices today, which often results in them being either overwhelmed and thus not buying, or taking their time to evaluate before buying. Both these scenarios are ‘torturous’ for businesses struggling as it is to sell in an overcrowded market. Using customer FOMO, businesses coerce customers into making a decision to buy – the online flash sales are great examples of companies harnessing customer FOMO. As mentioned, in today’s cutthroat environment of business, companies must resort to means that will get customers to buy, repeat their purchases, and encourage others to buy as well.

With the rise in technology and social media usage, customer FOMO seems more pronounced. This is because everyone is increasingly connected and aware of the many options, offers, and choices in the market – research shows that at least 56% of those who use social media have the fear of missing out. Research further proves that at least 70% of all grownups ‘suffer’ from customer FOMO – in varying degrees of course. In the younger generation, FOMO seems to spread akin to an epidemic! They show up at events and other outdoor social activities simply because they are worried that everyone else – friends, peer group, and others would be engaging in fun activities and would have bragging rights over them. This is what customer FOMO makes people do – much to the delight of companies and businesses. There are times when customer FOMO is heightened because there is no talk about anything – even on social media – and hence people are unable to figure out what is ‘happening’ in their city and what their friends and peer groups are doing – they just continue to feel that they are missing out. This feeling propels them to buy something ‘cool’ just so that they are not left out.

Harnessing customer FOMO is a powerful method for marketers, and a company that has good control over it, is able to mould customer buying decisions and behavior in its favor, and even influence prospective customers to start buying. Smart companies know exactly how to use the power of persuasion intertwined in customer FOMO, thereby inducing people to buy more and even those things that they might not normally buy. Is it a surprise then, that people line up outside a store, hours before their ‘loved brand’ puts a new product on sale. The FOMO is too great.

Harnessing customer FOMO is all about companies using ‘the fear’ to sell more and to be perceived as special and unique. While this method is not new, it has taken on significant proportions as people needs, expectations, and aspirations have grown, the need to stand out has become more pronounced, and each one trying to get more out of life and money. By using all the ‘necessities’ that customers so vehemently profess, marketers are successfully harnessing customer FOMO to sell products, services, and even ideas. As mentioned, FOMO is not a new phenomenon but with the advancement in technology, people are more amenable to ‘sharing’ their social lives with others, in the bid to look good and feel superior, FOMO has become a raging flame. Real time updates on what others are doing and constant awareness of cool events and activities, has only added fuel to the FOMO flame.

Customer FOMO has both ephemeral and status related qualities. The ‘live’ status of being somewhere awesome or buying something trendy makes for the ephemeral portion, while exclusive access, or limited seats, preferred entry and other such enticers are all about the status. People want both – hence the instant updates, or posting of pictures and real time accounts of presence at dos, and other such ‘posts’ make others want to be part of such activities and purchases – eventually leading to more buying by customers, translating to more profits for companies. The fact is that people value experiences more – experiences that would enrich their lives, allow them to form and deepen relationships with like-minded people, and become a ‘worthy’ part of the social scene. This also has a direct relation with customer FOMO, and marketers are not wasting a single opportunity. The new age customers, especially the younger generation, seem to prefer being at social events much more than buying actual products, as these events satisfy their emotional needs, especially that of a great social standing.

While experiences are critical, people are also spending a lot more to buy products too – research shows that in the U.S. alone spending has increased by almost 70% – that is a whopping figure and it would seem that marketers are finding success while harnessing customer FOMO. Marketers know that since people, especially the younger generation of today – who will become the largest spenders soon, want better experiences as opposed to products, must do something to ‘convert’ physical products to experiences. This is where customer service comes in – customers would rave about the top class experience and service they received at a store before they even mention the ‘article’ they bought. Hence, they would not only repeatedly go back to the store, but also take their friends and families too in a bid to keep all the ‘good stuff’ for them – harnessing customer FOMO at its best since it leads to enthusiastic positive word of mouth.

Smart marketers will not stop at designing strategies only for the currently available social and other online channels – they will continue to innovate and design strategies to leverage the strengths on possible channels too. Is your company successful at harnessing customer FOMO? What are some of the strategies involved? The most obvious, it would seem, would be to portray something as exclusive and unique. Something that everyone wants, but cannot have – barriers to entry or buying exclude people, creating a rush amongst the ‘selected’ to buy before anyone else does.

Positive word of mouth happens through delighted customers. The more a company is able to please its customers by way of top class service and products, the more likely customers would be to speak well about it. This in turn fans customer FOMO since people want the best and are prone to accept the ‘verdict’ of current users to buy things that they may not have otherwise bought. However, it is up to the company to create experiences around products and services such that customer FOMO is justified and proved relevant. People do not want to buy something because everyone seemingly would be, and then have buyer’s remorse because either the experience or the product itself, turn out to be a ‘damp squib’. In addition, creating hype around time is essential to fire customer FOMO – obviously, if something is available only for a short time or in limited quantities, people would want to be among the ‘first’ to buy or be part of.

Customer FOMO is real, powerful, and an extremely potent tool – smart marketers of today know this and are completely aware of how they should use it for long lasting benefits.

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