Wednesday, June 22, 2016

Netflix Titles and the Illusion of Scarcity

Every month, I receive a similar email - a list of all the titles leaving Netflix in the next month. Here's the July list. And of course, what this list does is illicit a "Damn, I better go home and watch that movie RIGHT NOW!" reaction. Sometimes, there's a legitimate reason to immediately want to watch that movie - for instance, I started watching at one point, had to pause and walk away for some reason, and never got back to it. But much of the time, the reason I haven't watched that movie on Netflix yet is because I wasn't interested. So why does this list influence my behavior?

What the list is probably doing is creating an illusion of scarcity, which makes an object appear more attractive. In fact, in psychology, we call this the scarcity heuristic - where the value of an object is based on how easily it could be lost. This is why infomercials have timers on their ads and tell you to "Call in the next 10 minutes to get this great deal." Spoiler alert: My husband used to work in broadcasting and informed me (which I suspected) that those ads are often squeezed in during the local ad time on stations; the time at which the ad is shown is irrelevant and there really is no timer on that deal.

But those timers work. And the reason they work is because they force you to make a decision in an arbitrarily shortened amount of time, which means you're more likely to make decisions using heuristics and knee-jerk reactions, as opposed to systematic thought. In fact, there are surprising number of psychological principles going on in infomercials that I won't go into. They're just applied in a really over-the-top way:

Of course, the difference with Netflix (as opposed to infomercials) is that the cost of streaming is fixed, regardless of how many movies you watch, so urging you to "watch this movie now!" is not really costing you anything (besides time). But I would imagine this approach generates revenue for Netflix somehow - perhaps by encouraging people who don't already subscribe to sign up, or people with the live streaming plan to add access to the DVD/Bluray library so they can continue to access those movies.

Still, I have a feeling I'll be watching Best in Show tonight.

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