Imagine that you are on a weekend break in San Sebastián, a glorious city on the northern Atlantic coastline of Spain, famed for its wonderful restaurants and bars. In the heart of the old quarter of the city, there’s a bar that many people claim serves the best tortilla in the world.
Naturally, you’d like to try a slice for lunch. But there’s a twist. The bar only makes one tortilla each lunchtime, which is cut into exactly 12 slices. And to try some, you need to add your name to a list an hour before lunch. Which means joining a queue before then.
In the picture above, taken 20 minutes before names are written onto the list (and therefore 80 minutes before lunch is served), there are already more than 12 people in this queue. Which means that some of these people are going to miss out.
If you’re capable of making the world’s greatest tortilla, why would you adopt this strategy? As the presenters of a BBC documentary on remarkable meals in cities around the world asked, why don’t they just make - and sell - more tortilla? The economists in our ranks might suggest another way of balancing supply and demand: just increase the price of the tortilla.
But what, at first glance, looks like a strange approach starts to look more interesting when you understand how we respond to scarcity. Studies of consumer behaviour consistently show that we are most likely to purchase products when we think there is a limitation in supply.
And though limiting the amount of time something is available is effective (‘2 day sale’), it is even more effective to limit the quantity (‘only 100 available’). Studies have also shown that, not only are we more likely to purchase items in limited supply, we consider them to be more attractive, more expensive, and more valuable.
So in other words, making very few slices of tortilla available might be an important factor in enabling us to perceive this to be the best tortilla in the world. The fact that it is in such short supply makes us want it even more. Seeing a big queue of people reinforces our belief that the tortilla must be good. And this - in turn - creates a restaurant equivalent of the halo effect, which encourages everyone, including the author of this blog, to visit the bar for food and drink other than tortilla, which it turns out are available.
What works for a small bar in a Spanish city is being used by companies and brands around the world in increasingly sophisticated ways. Amazon now uses ‘Black Friday’ and ‘Prime Day’ to limit the time and supply of goods for sale. Booking.com encourages you to book now by telling you how few rooms are available. McDonalds introduces specific versions of burgers (like the McRib) for only a limited period of time. And Cadbury’s famously reversed its decision to sell Creme Eggs throughout the year, when executives surmised that doing so stopped making them feel ‘special’.
So the next time you find yourself really wanting a slice of tortilla, McRib or a Creme Egg, ask yourself if you’d still want it if it were always available. And if the answer is ‘no’, have a think about the alternatives available.