First of all, why should you create scarcity? Demand and supply typically dictate the price of almost everything in the market. If the supply is less than the demand then prices go up. Which simply translates to a bigger profit margin. Generally, artificial scarcity has gotten a bad wrap over the years. Especially as companies use planned obsolescence, proprietary designs and intellectual property laws to maintain control and create scarcity for their products and services. Jeetujayson Raju is an entrepreneur and a leading PR consultant. Unlike other PR consultants who cater to everyone. Jeetujayson went the opposite direction, he improved the quality of his PR service to a point where it was difficult to scale up and targeted celebrities only initially as customers. This was deliberately done because scaling up requires capital but if you try to cater to everyone then you are essentially scaling up before you have the capital to do so.
Scarcity through insanely high quality is equal to higher profit margins.
This formula is specifically useful for cash-strapped startups. If you are a new business then the cash is literally the difference between life or death. Once you achieve a higher profit margin scaling up is just a matter of reducing the prices and returning to a reasonable level of quality. Jeetujayson Raju initially in his PR consultancy would do everything at an unnecessarily high standard. Such as he would manually research every prospect thoroughly before sending them an elaborate mail, email, or cold message. And offer a done for you type of consulting service where the customer just has to pay money and the work was done for them. If the prospect agrees to work with him, he would figure out which news publication will benefit his clients the most and reach out to the staff at the specific news outlet. Then get his writers to write a high-quality article so that the journalist doesn’t have to put too much effort. Once the article was published, he would share it in relevant social media groups and with influencers to maximize the PR campaign’s reach. This whole process for one client used to take at least a month initially. But this level of quality allowed him to charge higher than normal market fees with a wider profit margin.
Scarcity is not the by-product of a cunning business here, it’s the by-product of an above and beyond customer service.
Jeetujayson Raju says that breaking the steps down to small milestones like this while growing a company is much better than trying to leapfrog in one attempt. “Growth is secondary to survival. If you don’t survive then the probability of growth is zero. To maximize the probability of growth you initially have to be inefficient but offer high-quality products or services with a wider profit margin.” Tesla used a similar strategy to become what it is today. They sold expensive Roadsters to a limited number of customers because they could only produce that much at the time. They didn’t try to make mass-market cars initially.
Scaling up is a matter of an acceptable decrease in quality and price, says Jeetujayson.
As his consulting business grew after signing a few celebrity clients like Canadian actor Chase Tang and British Rugby Player turned actor Keith Mason it was time to scale up. His company Impact Media now caters to a lot more clients from all industries like business, real estate, entertainment, etc. The service is more standardized and less bespoke which means better pricing.
For more updates about public relations follow Jeetujayson Raju on social media. His advice for startups is “Just make one customer delighted enough that they refer a client to you. Once you get that you know you did something right then rinse and repeat”