Neuromarketing – The next big thing in market research

brain-scan

American marketing pioneer John Wanmaker once said that half the money he spends on advertising is wasted. Ironically he continued that the main problem was that he didn’t know on which half.

This is the common adage for senior managers, marketers, and creatives who constantly try to identify the most effective and efficient way to communicate to potential consumers. For many who have not worked in the industry, marketing can be fun but not as glorious as it might seem. For example only 30% of new products remain on the market after two years. While Bloomberg had estimated that 80% of new businesses fail within their first 18 months.

Therefore marketers are increasingly under pressure to make the right choices. While investing in advertising is an essential component of the marketing mix, doubts sink in whether the planned communication will capture the attention of consumers and most importantly trigger the desired action.

Understanding Customer Emotions

Early philosophers like Descartes believed that human beings were motivated by logic and all decisions made were based on rationality. Then came Freud in the last century and argued that emotions can override behaviour. While consumers make it a point that their purchase decisions are triggered through rational thinking, the truth is that 90% of purchase decisions come from the unconscious mind.

Research has confirmed time and again that emotion is a critical driver of our decision making process. Emotion guides what we pay attention to from our environment and whether we are motivated to approach it or avoid it.

Understanding consumer behaviour has become a necessary skill for marketers. Knowing what triggers consumer emotions has become an indispensable advantage. That advantage can be achieved through a scientific approach better known as neuromarketing.

Neuromarketing

Neuromarketing is an area of research started by Professor Ale Smidts. Neuromarketing is defined as the use of identification techniques of cerebral mechanisms to understand the consumer’s behaviour in order to improve marketing strategies. Smidt actually won a Nobel Prize in 2002 for his work related to neuromarketing.

Neuromarketing is a scientific approach to research and understand why consumers behave and react when interacting with the brand and making a purchase decision. Neuromarketing has become a new form of market research using neuroscience tools to measure the emotional impact of communication across all media, and translate the findings into actionable marketing recommendations.

Neuromarketing is simply the study of how the human brain responds to marketing stimuli. This helps marketers understand the underlying reasons as to why consumers make the decisions they do. It facilitates an understanding to the subconscious reasoning and behaviour of customers.

Application & Benefits

Consumer buying decisions are made in split seconds in the subconscious and emotional part of the brand. What we like, don’t like, fear, or love is stored in our brand and it is that stimuli which drives the impulse to make the actual purchase decision.

While neuromarketing research has not been around for very long, big and established brands have quickly embraced the methodology in their quest to establish a competitive advantage through the understanding of consumer needs. Science doesn’t lie. It is an interpretation of the facts, but results that can clearly explain why consumers behave as they do.

Realistically most opinions related to marketing are quite subjective. Like what is the best colour to use on the package? Where best to place the logo on the artwork? Do people really consume your brand even though they respond positively that they are aware of it? How positive was the consumer’s stimuli when actually consuming the brand?

Many questions like the above can be answered through neuroscience. Neuroscience does not brainwash consumers. It seeks answers while using scientific techniques to analyse and answer the several riddles of consumer behaviour.

Research Methods

While neuroscience is still in its infancy, there are already a considerable amount of research methods to carry out neuromarketing. A common method is electroencephalography (EEG). This technique is used to record electrical activity in the brain by attaching electrodes to the scalp. This approach is used to monitor brain activity when the subject is requested to carry out a task. For example the consumer might be asked to see a TV commercial and the brain activity can be recorded to measure how positive the brand encounter was.

Another method is magnetic resonance imaging (fMRI) which detects changes in blood flow in the brain. Once again by carrying out a pre-set exercise, the subject may have a brand encounter and the blood flow activity recorded can define a scientific outcome to the consumer’s experience with the brand.

Eye-tracking is another neuromarketing technique which measures eye positioning and eye movement. For example this technique can be used to identify where is the most looked at place on your website home page. Or the same for your visual advertising. The technique is also quite commonly used by big retailing brands to improve their visual merchandising. The same goes for FMCG brands who dictate supermarkets on which shelf they want their products to be placed.

Facial emotion coding and reaction time is also another technique to measure consumer behaviour. While consumers might hesitate in offering negative feedback about a brand, such research techniques record factual behaviour which does not lie.

One last neuromarketing technique is voice analysis. Through research in studying the tone and fluidity of one’s voice, researchers can detect patterns which can provide insight on the consumer’s real motivations.

In a nutshell, common metrics for neuromarketing research are the respondent’s attention level, their emotional engagement, and their memory storage. All or either metric can provide marketers with valuable insights on the consumer experience and ultimately affinity towards the brand.

Do you remember the Pepsi Challenge?

One of the greatest marketing case studies is the Pepsi Challenge. Executives at Coca-Cola went into panic mode that they even changed their recipe to appease consumer belief due to the Pepsi Challenge. Little did they know was that neuroscience could have been the tool to decipher what was really happening.

The reality of the marketing stunt was that many consumers chose Pepsi over Coca-Cola in a blind tasting test because Pepsi is tad sweeter. So by choosing Pepsi in a blind tasting exercise, will consumers still choose Pepsi as a brand? Not necessarily because even though Coca-Cola sales stuttered momentarily there was an even bigger shock when Coca-Cola conceded to defeat and changed their recipe.

The moral of the story is that at the time executives at Coca-Cola underestimated the cognitive power of the Coca-Cola brand. The power behind consumer emotions when choosing between the Coca-Cola red can from a Pepsi blue. Neuromarketing research could have been the tool to identify the gap between consumer perception and their cognitive. Scientifically this is referred to as the “old brain” also known as the reptilian brain versus the “new brain” known as the neo-cortex.

Concerns

Scepticism still exists in regards to neuromarketing research. For example consumer protection groups complain that neuromarketing is a practice to manipulate consumer attention and exaggeratingly state that is used to brainwash the target audience.

It all boils down to ethics and the core purpose neuromarketing is being used. What many don’t know is that neuromarketing researchers are regulated through international recognitions networks which encourage networking and collaboration of research.

Marketers always strive to create a more appealing product. Something that looks, feels, sounds, and smells better than the competition. This is the purpose of neuromarketing. To use technology to remove subjectivity and ambiguity. Gone are the days of shooting from the hip.