Scarcity Makes the (Digital) World Beautiful

Matcha (green tea) and wagashi (traditional Japanese sweet) in Ritsurin Koen

I sat down to a traditional Japanese tea service in Ritsurin Koen, and I received:

  1. One chestnut-filled sweet little wider than a quarter.
  2. Less than an inch of green tea.

No refills. No second helpings. No nosy “How are you doing?” service. I ordered, it was delivered without comment, and I sat back to enjoy it. If the daimyo of Sanuki enjoyed the same tea service almost four hundred years ago, then I could too. The view wasn’t half bad:

View from the Ritsurin Koen teahouse. And a koto.

To prolong the experience, I sipped my tea slowly and nibbled at the corners of that chestnut until both were gone.

And I was more than happy. Much happier than if I had been given a dozen sweets or a series of green teas served endlessly. I appreciated every bite, every sip, and the unobtrusive quiet that did not need to proclaim how good everything was. It was just good.

Making Digital Products Valuable

“We live in a world where there is more and more information, and less and less meaning.” — Jean Baudrillard, Simulacra and Simulation(1)

Because I make digital products, I’m all-too aware of how easy digital goods are to consume. To download an app for free and forget about it. To play a show on Netflix, pause it, and never start it again. To read a hundred tweets, none of which you will ever reconsider.

Digital goods without perceived cost often end up lacking perceived value. Scarcity puts the meaning back in a digital world that could otherwise become a copy of a copy of a copy.

There are many ways to create value, but let’s consider two complimentary methods to make digital products unique and, by extension, valuable: product-side scarcity and user-side scarcity.

To capture Pokémon, you have to physically move to them.

Product-Side Scarcity: Pokémon Go

The makers of Pokémon Go could have given you every Pokémon ever created from the start. And they could have given you an almost infinite number of copies of each at just about zero cost. But those Pokémon would have had little value because they didn’t cost you anything.

“Water, water, everywhere,
And all the boards did shrink;
Water, water, everywhere,
Nor any drop to drink.”
— Samuel Taylor Coleridge, Rime of the Ancient Mariner(2)

The core mechanism of Pokémon Go is that each Poké Ball or cuddly creature costs something. A walk down the street. A drive downtown. Or a relatively steep financial commitment (compared to the baseline of free).

Uniqueness in the game is related to cost, measured in terms of time or money. Very often the more unique a (digital) good is, the more it costs. And the converse is also true—the more it costs, the more unique it is because you’re less likely to pay the price. This creates a feedback loop that produces value.

Success Means Being Both Scarce and Widely Available

While this isn’t true of all successful apps, success with the “freemium” model can involve bridging an apparent contradiction: the need to be both scarce and free. The app must be scarce in that it costs significant amounts of either money or attention (that is turned, through the magic of advertising, into money).

But the app must also be free in the sense that customers can try it without cost, improve their day-to-day, and then face the sting of the app being suddenly gone from their lives. If losing dollars stings less than losing the app, then the hope is that people will pay to keep using it.

The freemium model allows games like Pokémon Go to become overnight sensations. 14 days after its initial release, it had been downloaded 30 million times with $35 million in revenue(3). The digital goods within the game are scarce, and thus they have value—enough value for players to pay actual dollars despite the fact that the game is free.

Very Goods

User-Side Scarcity: Very Goods

Very Goods is a small community of taste-makers whose collections influence the world of designy goods. It competes with the likes of Amazon(4), despite its stated goal of keeping its membership small.

Very Goods champions the 1%. From A Note on Smallness.

As opposed to Pokémon’s product-side scarcity, Very Goods creates user-side scarcity by limiting the number of users. The result is a thriving community of just over 1,000 members that produces content for over 18,000 monthly viewers and climbing.

In most cases, scarcity is required to produce valuable—and dare I say beautiful—digital goods in a world that is all too often without either quality.

Teahouse in Ritsurin Koen

Scarcity Creates Beauty

With global competition and unsurpassed availability, digital products can find themselves in a race to the bottom: “OK, I guess I’ll buy it” lowest prices, “I want it now” fastest delivery, and all of it encapsulated in a “More is always better” philosophy that can end up diluting the value and beauty of our digital goods as well as our experience of the world around us.

I am not proposing that we raise prices, limit distribution, and cut production across the board. Instead, I am just saying that we—as both consumers and creators of digital goods—might do well to consider the tea service in Ritsurin Koen: one small tea, and one small sweet. That might just be all we need.