FOMO: (Fear Of Missing Out): meaning & uses in marketing

Introduction

When ChatGPT suddenly went viral worldwide in late 2022, there was an immediate urge among entrepreneurs to "do something with AI. From large multinationals to smaller startups, suddenly investing in artificial intelligence was at the top of virtually every business agenda. But why really? Was there really a rational strategic consideration at play here, or was it mainly the fear of being left behind?

This phenomenon - better known as FOMO (Fear of Missing Out) - influences our behavior more strongly than we think. In this article, we dive into the science behind FOMO and discuss how you, as an entrepreneur, can harness it in a smart and responsible way.

What does FOMO mean?

Fear of Missing Out (FOMO) is the feeling of fear or anxiety that arises when a person thinks they are missing out on important opportunities, experiences or benefits, especially when others are clearly benefiting.

The term became popular through the work of social psychologist Andrew Przybylski and colleagues (2013), who determined that FOMO stems from the natural human need for social connectedness and constant comparison to others.

This fear manifests strongly in our modern digital society, where social media makes it easier to follow others' accomplishments and experiences. The result? People - and certainly entrepreneurs - are more quickly pushed to make decisions because they are afraid of falling behind otherwise. Research shows that FOMO can lead to impulsive behavior, increased stress and decreased satisfaction with choices made (Przybylski et al., 2013).

It is essential for business owners to understand this mechanism well because it affects not only their own decisions, but also their customers' choices and buying behavior.

Examples in practice

• The bitcoin hype
  Everyone suddenly seemed to be investing in cryptocurrency. The fear of missing out on the next big financial hit was palpable, even among entrepreneurs who had never dealt with crypto before.
• Clubhouse-invites
  When the audio app Clubhouse operated exclusively by invitation, entrepreneurs rushed to attend purely because they were afraid of missing out on important conversations or networking opportunities.
• Black Friday deals
  "Only 4 hours left!" - consumers feel pressure to buy something or they will miss out on a unique offer.
• Exclusive events
  The fear of missing out on important networking opportunities often causes business owners to purchase expensive tickets, even without clear goals in advance.
• Limited Edition Products.
  From sneakers to smartphones, limited editions cause people to spend hours in online queues or storm physical stores.
• New technology such as AI
  The fear of falling behind has prompted many entrepreneurs to quickly integrate AI solutions, sometimes without knowing exactly what it will bring in concrete terms.

These are just a few examples of how FOMO affects both personal and business choices on a daily basis.

Why do entrepreneurs experience more FOMO?

Many entrepreneurs feel the need to react quickly to developments for fear of losing competitive advantage. This fear can be explained from social comparison theory (Festinger, 1954). Entrepreneurs constantly compare themselves to competitors and fellow entrepreneurs. If a competitor suddenly achieves success with a new technology, for example, as is now the case with artificial intelligence, a strong sense of urgency immediately arises: "If I don't react now, I'll definitely miss the mark later."

The phenomenon of loss aversion (Kahneman & Tversky, 1979) also plays a role. Entrepreneurs experience potential loss as much more painful than the joy that profit gives and want to avoid it at all costs. This reinforces the urge to take quick action, even if it means making decisions less thoughtful.

In addition, today's digital environment further amplifies this phenomenon. Social media, business networks such as LinkedIn, and constant news reports of others' successes increase the sense of urgency and the perception that quick action is necessary.

Use of FOMO in marketing

Fear of Missing Out (FOMO) is a common trigger that marketers use to get consumers to buy faster and more often. Using the principle of scarcity and urgency, they encourage consumers to make quick decisions for fear of missing out on a unique opportunity.

The following are some common FOMO marketing techniques:

1. Temporary offers and deadlines.

These are actions of limited duration, for example:

• "Only 24 more hours 30% off!"
• "Order before midnight and get free shipping!"

2. Limited supply (scarcity).

Marketers emphasize limited availability to create haste:

• "Only 5 rooms available at this price!"
• "Only 3 products left in stock!"

3. Exclusive access and VIP treatment

Consumers want to belong to a select group:

• "Exclusive invitation to the first 50 registrants."
• "Become a member and receive unique benefits only for our premium members."

4. Social Proof

Show that others also participate to reinforce FOMO:

• "250 entrepreneurs went before you!"
• "Already sold more than 1,000 times in the past 24 hours!"

5. Countdown timers

Visualize urgency with countdown timers on websites or in emails:

• "Only 10 minutes left to take advantage of this offer!"

These techniques cause consumers to act less rationally, make decisions faster, and purchase sooner to avoid the feeling of potential loss or missed opportunity.

Why this works.

According to Cialdini (2016), scarcity plays directly into our natural tendency to value more something that is hard to obtain. As a result, consumers feel additional urgency and are more willing to take action.

Risks of applying FOMO

While it can be highly effective to employ FOMO in your marketing communications, there are also significant risks associated with its overuse or improper use. It is good to be aware of these potential pitfalls:

1. Reduced customer satisfaction

When customers feel pressured to make quick decisions, they may experience regret afterwards. This can lead to negative reviews and long-term dissatisfaction.

2. Damage to trustworthiness and reputation

Businesses that repeatedly create false urgency (for example, fake stock notifications or always 'temporary' discounts) risk losing credibility and customer trust permanently.

3. Short-term gains at the expense of long-term customer relationships

Constant pressure and urgency causes customers to experience stress, which can lead to dropping out, losing you valuable, loyal customers.

4. FOMO Fatigue

Consumers can become "FOMO tired," meaning they become immune to your marketing tactics. This leads to future actions becoming less effective.

Examples of negative impacts:

• Online stores that constantly display fake discounts ("normally €100, now €30") are often publicly criticized these days.
• Companies that artificially create scarcity, such as limited editions that are later re-available anyway, quickly lose credibility.

Advice to entrepreneurs:

Deploy FOMO strategically and in doses. Transparency and authenticity are important here. In the long run, trust creates more value than temporary sales incentives.

Ethical and effective use

Applying FOMO successfully and responsibly in marketing requires a careful approach. Below you will find concrete guidelines on how we believe entrepreneurs can make optimal use of FOMO, without the potentially negative consequences:

1. Transparent communication

• Be clear and honest about actions. Make sure scarcity, urgency or exclusivity actually exists.
• Example: If you advertise "Only 5 tickets left available," make sure that's really the case.

2. Authentic urgency

• Create urgency around real events, such as temporary promotions tied to seasons, holidays, or specific company anniversaries.
• Example: "This special anniversary discount is only valid on July 1, our birthday."

3. Balanced deployment

• Deploy FOMO selectively. Overuse reduces the effect and can lead to irritation.
• Example: Use scarcity in a targeted way, for example at a product launch, but not constantly.

4. Prioritize long-term relationships

• Combine FOMO with valuable content and excellent customer service. Build trust so customers feel good about their decision.
• Example: After purchase, confirm the customer's choice by providing valuable aftercare.

5. Evaluate regularly

• Measure the effect of your marketing campaigns and stay sharp on customer feedback. If you get negative responses to your marketing statements and your results are declining, adjust your strategy.

Conclusion

Fear of Missing Out (FOMO) is a powerful psychological mechanism you can use to get customers to take action. But as always, use with caution. Using it too often or incorrectly can lead to irritation, customer loss and reputational damage.

Want to use FOMO responsibly and effectively to grow your business? Then engage an experienced marketing agency that knows exactly how it works. Choose an agency that has proven experience in the smart use of psychological principles so that your business achieves sustainable results without compromising your brand or customer loyalty.

Don't wait too long, your competitors have probably already started. Get in touch today ;)!

Resources

Cialdini, R. B. (2016). Influence: The Psychology of Persuasion (Rev. ed.). Harper Business.

Festinger, L. (1954). A theory of social comparison processes. Human Relations, 7(2), 117-140.

Kahneman, D., & Tversky, A. (1979). Prospect theory: An analysis of decision under risk. Econometrica, 47(2), 263-291.

Przybylski, A. K., Murayama, K., DeHaan, C. R., & Gladwell, V. (2013). Motivational, emotional, and behavioral correlates of fear of missing out. Computers in Human Behavior, 29(4), 1841-1848.

Shapiro, G. K., & Burchell, B. J. (2012). Measuring financial anxiety. Journal of Neuroscience, Psychology, and Economics, 5(2), 92-103.