Market forces set value independent of actual tangible worth. Therein lies the profit margin.

Occasionally the value bares such little correlation to the worth that it creates a case study for brand owners. How can we achieve this for our branding?

Take Beanie Babies for example. At the height of their popularity, they were seen as a “financial investment”.

How can a stuffed toy be seen as a financial investment? Just as a pair of running shoes, or a place marker on a blockchain can.

What’s the secret? Supply breeds demand.

Beanie Babies were sold according to a strategy of deliberate scarcity: producing each design in limited quantity, restricting individual store shipments to limited numbers of each design and regularly retiring designs, increasing their popularity and value as a collectible. People would flip Beanies at as much as ten-fold on eBay, and at one time Beanie Babies made up 10% of eBay’s total sales!

Yeezy Foam Runners were introduced in June 2020 and the $75 shoes sold out immediately after their release. Their resale value ranges from $250 to $800.

Bitcoin has a hard limit on supply of 21 million coins. Researchers estimate that the cost of creating a single Bitcoin is about $2500 (calculated by the cost of energy when mined by professional, energy-efficient mining rigs in China, increased due to account overhead, machine costs, and a 25% profit margin similar to the margins of the most profitable gold mining companies). Whereas a Bitcoin is sold for around $45,700.

This is encouraging news in the days where Covid-19 has limited access to business’ supply of packaging and materials. We have had clients reporting waits of up to 3 months to source the products that are central to their business model. It is a challenge. But, if we look for patterns across success stories, we can see a way through this and turn adversity into a strategy for our own success.

Come to Tarr Law if you are looking to leverage your branding in Covid times, turning scarcity into demand.