How ‘Scarcity Thinking’ Impacts the Sales Effort

Scarcity thinking is a mindset. It’s when an individual believes there is not enough of something – money, opportunity, time, etc. Any of us can experience scarcity thinking, regardless of our circumstances – “I don’t have enough money” “I’m not making enough money” “The market opportunity is not large enough” “I don’t have enough customers” “I don’t have enough time”

The interesting thing about scarcity thinking is that it is most often an illusion – a belief in something that appears real in the moment, but may or may not actually be the reality. Scarcity thinking is merely a perception of reality.

Wealthy individuals, successful salespeople, proven sales leaders can all experience ‘scarcity thinking.’ In fact, the amount of success, money, or wealth an individual has accumulated rarely corresponds to how effective they are in avoiding ‘scarcity thinking’. Many of the wealthiest people in the world still feel they do not have enough money, and are desperately trying to earn more of it or cling to what they have.

The Impact of Scarcity Thinking

When salespeople start believing there is ‘not enough’, it can impact the way they think and act. Recent research cited in the book “Scarcity” by authors Sendhil Mullainathan and Eldar Shafir found that regardless of the actual condition, when we are experiencing the pinch of ‘scarcity thinking’, we make bad decisions. Their research indicates that our thinking becomes narrowly focused upon short-term challenges. Our capacity to make decisions that help us in the long term are more difficult to make. And, our capacity to think how our actions today can impact us long-term are limited.

Impact On Salespeople

Salespeople who are caught in ‘scarcity’ thinking get caught up in the immediate goal of making a sale. When this happens, they may no longer be able to demonstrate customer-focused behaviors such as being patient to learn about the customer, their needs, goals, and listening carefully and taking the time to fully understand the customer and what they want. They may not have the patience to ask in depth questions to fully qualify opportunities.

Instead, the scarcity minded salesperson’s focus get fixed on the customer expressing any type of interest in their product. At the first sign the customer states a challenge the salesperson feels they can ‘solve’, the scarcity minded salesperson stops listening and learning and starts talking – describing their product and prematurely shifting the focus away from the customer and onto their product/solution and their goal of making the sale. They may also rush past customer concerns and questions in their attempt to ‘get the sale.’ When this happens, the customer realizes the salesperson is not truly focused on them. Instead, the customer experiences the salesperson as focused on ‘getting the sale’ which is salesperson-focused.

Impact on Sales Teams

Employees under pressure, being told they are not making enough sales, start to operate with scarcity thinking. They make decisions that are short-term focused and it has the potential to cause big long-term problems. Wells Fargo Bank is a classic example of bad decisions being made to meet short-term goals. Sales employees opened new accounts to meet their own sales goals without customer’s consent. The short-term goal was met. New accounts were opened. The long-term consequences in damage to the company’s reputation and brand are still being felt.

Impact on Sales Leaders

The implications of the research by Mullainathan and Shafir for sales leaders are many. If you are creating conditions in your sales team where salespeople feel they cannot ever make ‘enough’ sales, or make ‘enough’ commissions, or their efforts are ‘never enough’ for management, they may start to make short-term decisions that could have negative long-term effects for your company and brand. They may do things that are unethical, illegal, manipulative, or less than ‘above board.’ Salespeople who need to make a sale while ‘not having enough’ or experiencing ‘scarcity thinking’ may become more self-focused, have less patience and stop spending time doing things that could result in big long-term payoffs. They may stop prospecting (requiring long-term focus) and focus only on sales they can land today.

Sales managers caught in scarcity thinking may think twice about using fear and threats to motivate. Sales managers trying to get salespeople to patiently listen to customers, use CRM, follow a sales process and use selling techniques that are customer focused and bring long-term results may want to consider taking a more positive motivational approach. ‘Trust the process’ requires foundational thinking that by ‘trusting’, there will be enough. Results will follow.

Cultivating ‘Sufficiency’ Thinking

Successful salespeople have mastered the ability to live in a mindset of ‘sufficiency’ regardless of the current circumstances. Generating a mindset of ‘sufficiency’ is the opposite of living in the ‘pinch’ of ‘scarcity thinking’. Sufficiency thinking means we believe we are enough, we have enough, and there is enough of everything we need. Cultivating sufficiency thinking is an important sales practice that provides a solid foundation so that we can remain customer-focused, patient, strategic, and make good decisions at every stage of the selling process. It also protects you, your company and brand from costly short-term actions that have potentially damaging long-term consequences.