NEUROMARKETING, INGLES.pdf

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64 4Ps BUSINESS AND MARKETING 15 FEBRUARY - 14 MARCH 2013 15 FEBRUARY - 14 MARCH 2013 4Ps BUSINESS AND MARKET

USINESS & MARKETING

GETTING INSIDE THE CONSUMER’S MIND HAS BEEN THE BIGGEST CHALLENGE FOR MARKETERS. THE SECRE

THE HUMAN BRAIN AND ITS ABILITI ES HAVE CONFOUNDED THEM SINCE AGES. A TOTALLY DEDICATED STRE

NEUROSCIENCE NAMED “NEUROMARKETING” IS NOW ATTEMPTING TO U NDERSTAND THE CHEMICAL PATTE

THE HUMAN BRAIN TO PREDICT BUYING BEHAVIOUR. WHAT DOES THIS MEAN FOR MARKETERS, AND HOW

THEY LEVERAGE IT GOING FORWARD? ASHISH KUMAR OF 4PS B & M PRESENTS A SCINTILL ATING ANALYSIS

On a bright afternoon, on June 6, 2012, in a movethat was perhaps deliberately kept out of medialimelight, Robert Kaplan and Myron Gutmannrepresenting the Executive Office of the Presi-

dent of the United States quietly signed in a charterforming what is known in closed circles as the Intera-gency Working Group on Neuroscience, or IWGN. Thepurpose and scope of IWGN, as officially stated, was “tocoordinate activities in neuroscience research across theFederal government”. Cut to the 2013 State of the Unionaddress of the US President Barack Obama, and onecould clearly not miss the distinct statement he madeciting brain research as an example of how his govern-ment would “invest in the best ideas”. Was Obama’sstatement a deliberate forerunner to bigger news? Onedidn’t need to wait for long to get the answer. Cut againto February 17, 2013, and news breaks in global mediaof how the US government is probably now formally onthe cusp of announcing a decade-long never-before-seen mammoth effort to map the human brain. The NewYork Times reported on the same day, “Scientists in-

volved in the planning said they hoped that federal fi-nancing for the project would be more than$300 million a year, which if approved byCongress would amount to at least $3 bil-lion over the 10 years.” Comparisons of the

government’s brain mapping initiative arenow being made to the Human GenomeProject, which is considered the single mostimportant initiative to fully map the humanDNA.

In a furiously competitive world, as mar-keters continue to pour in billions of dollarsevery year in market research to understandconsumers’ needs, wants, demands and thetricky one, the latent demand, such hap-penings are ruthlessly followed and excru-ciatingly investigated. Today, with the hu-

man genome completely broken down and madoctors can easily pinpoint the exact genetic reaso

various parts of the human body behave the way tin any individual. Will the H uman Neuroscience P( so titled b y us) lead to similar results with respan individual’s mental faculties and responses? Ythe answer to this question, or rather, the power tinto the mind of an individual would be worth bof dollars, if not trillions, to the marketing powerglobal community, considering that a comprehunderstanding of the human brain and abil ity to foand influence consumer buying behaviour could reconomic equations like never seen before in thtory of mankind.

Astonishingly, Apple Inc.’s iconic founder, thSteve Jobs, was never in favour of market researoften said that the consumers didn’t know wha

wanted unless one was to build something and sthem. He reportedly told Fortuneonce that Apple market research when it came to developing newucts. Apple’s products, as if to support Jobs’ theoryaged to be more successful than any other produc

could be. Uniquely, Apple became thepole for the bunch of experts who opmarket research. Apple was glamoquoted as being proof enough of th

lessness of market research and of anaconsumer behaviour.The reality was far from that, an

cover on this supposed inhibition of towards market research was blown la

year. In August 2012, Apple’s VP of PMarketing, Greg Joswiak submitted laration to a US court explaining whcific documents relating to Apple’s mresearch and strategy should be sealeddeclaration clarified that every monthsurveys iPhone and iPad buyers and Jo

US maysooninitiate theworld’slargestbrainmappingproject

IS BRAIN MAPPING

THE NEXT FRONTIER

R O D U C T P R I C E P L A C E P R O M O T I O N



C O V E R S T O R Y B R A I N M A P P I N G


MARKETERS C

USE BRAIN MA

Can brain mapping ever bereplacement for judgemenanalyzing the needs, likes or

of a human being?I don’t believe that brain mappbecome a replacement. It is motool to help in analysis. Howevketers can use the brain maps tstand various activities going ospecific areas of the brain to undlikes or dislikes patterns.

If we someday completely get how or what neurological cotions make humans behave itain way, we may alter those nations. How distant does it sThis does not sound distant atare doing it now. My colleagues Rliams, Dr. Bruce Lipton, welauthor of The Biology of Belihave put together a program for

with leaders and balancing subcbelief patterns with the princnature to achieve sustainable Some of our research in the p years has invo lved subconsci oupatterns. Changing subconsciliefs will alter behaviour.

What have been your most su

experiences with brain mappThe process of brain mappinceases to amaze me even afterfor over 15 years. I have workchildren having trouble in schoadolescents that were able to tulife around due to brain traininseen amazing things happen witleaders and non-leaders alike. only scratched the surface as farmapping, brain tuning and achigher levels of consciousness.

Jeffrey FanFounderCenter forCognitiveEnhanceme

90% of the de-cisions we takeare at a subcon-scious level

explained what Apple was able tomake out of these surveys. Apple

wanted all of these tracking studiessealed so that rival companies couldnever find out what drove an iPhoneand iPad purchase or which set ofdemographics got the maximumloyal Apple consumers. After thisdeclaration, various estimates cameout that said that Apple might havespent anything between $300-500million a year in conducting suchmarketing research. Evidently, themarket research supporters had losttheir best argument with that onerevelation of Apple.

But where does neuroscience andneuromarketing fit into all of this?Perhaps better than we ever imag-ined. So what exactly does neuromar-

keting involve? We’ll start with a seatof the pants’ reply. Neuromarketingtakes the help of various brain map-ping techniques like Functional mag-netic resonance imaging ( fMRI ),Electrocardiography ( ECG), Electro-Encephalography ( EEG) and similartechniques to reach out and under-stand the parts of the brain that de-cide the buying behaviour of a con-sumer. Think about it. If marketerscould understand why a consumer

would prefer a certain product overanother, product specifications couldbe changed significantly based oncustomer wants.

But there’s a deeper inference inall this. Apparently, all we thought weknew about consumer research was

wrong. And what do we mean by that?Over the past many decades, and es-pecially over the past few years, re-search after research is popping upto prove that responses that humansgive verbally – and responses thatthey themselves believe to be true –may not exactly be what they in real-ity are thinking. Breaking it down, itmeans that if you were to ask a pro-spective consumer which colour of acar would he like, and if he choosesthe colour red because he truly be-

lieves that to be his first choice, neu-roscience allows researchers to de-termine whether the consumer re-ally likes the colour red or whetherthere’s some other colour that hemight like better without knowingabout it.

From the times of Nash equilibri-um to the times of Prospect theory,Nobel prize winning concepts haveproven that consumers do not neces-sarily take logical decisions and use

the vague space of intuition to basetheir less than optimal purchasechoices. The premise of these theo-ries lies in the fact that around 90%of the decisions we make are takenat a subconscious level. Hence, if abrand can speak directly to our ‘gutinstinct’, bypassing our logic andreasoning, they will sell more prod-ucts.

A March 2012 Harvard researchauthored by Carmen Nobel givesthe example of junk-food giantFrito-Lay, which hired a neuro-mar-keting firm in 2008 to look into howconsumers respond to images orother stimuli related to Cheetos, thetop-selling brand of cheese puffs inthe United States. Using EEG tech-nology on a group of consentingsubjects, the firm determined thatconsumers respond strongly to thefact that eating Cheetos turns theirfingers orange with residual cheesedust. With this information in hand,Frito-Lay moved ahead with an adcampaign in the US themed ‘The

Orange Underground’, featuring aseries of 30-second TV spots, in which the Cheetos mascot ChesterCheetah encourages consumers tocommit subversive acts with Chee-tos. During one such commercial,an airline passenger quietly sticksCheetos up into the nostrils of asnoring seat-mate. The campaignbecame a grand success, and evenhelped Frito-Lay grab a 2009 GrandOgilvy Award from the Advertising

Research Foundation.This is not a one of its kind exam-

ple. Companies are increasinglyleveraging such neuro-studies intotheir market research and productdevelopment research projects.Daimler-Chrysler conducted a sim-ilar study to understand the effectof their cars on the consumer’smind. The study revealed that im-ages of sports cars generated signalsfrom the reward center of the brain;the same area, which gets hyperac-tive during the consumption of al-chohol or drugs or during sex. Also,

when respondents saw the front ofthe car, the portion of the brain thatresponded to face-recognition lit up,suggesting some association with aperson they knew. These are tre-mendous insights for a future cardesign.

In the mid part of the last decade,in one of the notable neuromarket-ing tests, an American researchgroup headed by Samuel McClureused functional Magnetic Reso-

nance Imaging (fMRI) to examinethe correlation between brandnames and consumer preferences.

The research offered Coca Cola,Pepsi and another cola drink to theparticipants, without telling them

which drink it was. When consum-ers did not know what they weredrinking, researchers could see thesensory aspect of the brain gettingactive. But once they were againgiven the same cola drinks and were

From top (clockwise)(1) Brainmapping revealed that while watching the Gangnam Style video, most viewers experienced happiness, sadness and surprise, while dis gust, anger andfear were insignificant (2) Researchers have observed that people associate the frontof the BMW MiniCooper with a human face (3) Since 2008, Frito-Lay has utilised brainmapping as a very important tool in desiging its advertisements

Source:Entrepreneur magazine (At November 2011 prices in the US)

Unit cost of various marketing survey toolsBrain mapping techniques score over most other means

EEG fMRI Focus Phone Mail Email Analyst0

2

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14in $ U.S.





THIS IS THE

GOLD STANDA

What is the authenticity of vbrain mapping technologies lRI, EEG or EP etcetera?fMRI and MEG brain mappicompared to intraoperative m whenever possible. Intraoperatping is when a patient who unbrain surgery receives direct estimulation of their exposed bra which brain functioning served. Historically, surgeons hthis technique to roughly verify t were not dam aging tissue critpatient’s post-operative qualitsuch as a motor or language funregion. It is considered the golard of functional brain mappinever, this technique requires remore skull than is typically nececomplete a surgery, and also iperformed in clinical settingmedically necessary. Clinical comparing fMRI, MEG, and erative mapping have shown conresults ranging from 85% to 10pendent upon the neuroimagingity used and the type of brain fbeing tested.

While technology may generabrain maps, can these maps bpreted correctly?The best neuroimaging practitito great lengths to tightly contexperiments and analysis procgiving the best possible chancerect interpretation. There are sand weaknesses associated witype of neuroimaging, and a thunderstanding of these traits isary for optimal interpretiveTherefore, it is critical to emplotrained individuals in the task.

Erika LaingClinical AssUPMC Brainping CenterPennsylvan

whether or not they appe ar withinan appropriate or congruent pro-gramming context, the client want-ed to use brain mapping technologyto be sure about whether an advertis processed differently by the hu-man brain just because it is placed

in a different program slot.Neurosense conducted thestudy using fMRI to meas-ure the extent to which adsare encoded, understoodand liked if placed in a con-gruent versus incongruentprogramming context. Theresult said that the adsplaced in an appropriateprogramming context wereshown to be encoded, liked,attended to and processedin an emotionally positive

way to a far g reater degreethan when in an incongru-ent context. Using thesefindings, Viacom made keystrategic changes to its advertising pricing strategyand since then, Viacom andits partner MTV Networkshave managed to doubletheir global advertising

told the brand names too, the emo-tional part got active as well ( and thepreference shifted to Coca Cola, irre-spective of the taste). Look at howinsightful such information can be tothe marketing president arguing withhis CEO for more money to build thebrand.

In his book Buyology, Martin Lind-strom, the bestselling writer listed asone of the 100 most infulential peoplearound the world by TIME magazine,says that traditional advertising is oneof the reasons why 8 out of 10 newproduct releases fail. To prove hispoint, in one of the most extensiveneuromarketing studies, Martinscanned the brains of over 2,000 vol-unteers over 3 years at a cost ofaround $7 million. The study threwup mind-boggling findings. One ofthese findings was that warninglabels on cigarette packages stim-ulate activity in a brain area as-sociated with craving. This resultcame out despite the fact that sub-jects often said that they thought thewarnings were effective.

In other words, while the consum-ers believed that warning signs woulddissuade them from consuming cig-arettes, the actual result was aston-ishingly the opposite. It was easy toconclude that having these signs oncigarette packs actually couldpush the sales up as comparedto the popular belief that it willdiscourage the smokers. An-other observation said that theimages of dominant brands,such as the iPod, stimulatedthe same part of the brain ac-tivated by religious symbols.Hence, the consumers tend tohave a strong loyalty for thesebrand as they may have fortheir religion.

It is the result of these find-ings that neuromarketing hasbecome a huge industry in it-self. According to a January2012 estimate by the Advertis-ing Research Foundation, theneuromarketing industry maystart generating over a billiondollar plus in revenues by theend of the year 2013. This isreally serious money, consider-

ing that the industry is not even adecade old. While none of the com-panies in the neuromarketing busi-ness shared their financial figures

with 4Ps B&M , their client list is atestimony that the world’s most pop-ular brands have started roping inthese neuromarketing agencies. Forinstance, Nielsen-owned NeuroFo-cus has investigated over 50,000brains so far for its clients like Micro-soft, Citi, Starcom MediaVest, Cali-fornia Olive Ranch and of course forthe parent company, which we love to

vex, Nielsen.Similarly, London based Neuro-

sense boasts a wide array of clientsincluding Intel, GlaxoSmithKline,P& G, Johnson & Johnson, BBC,

Viacom, Coca-Cola and Unilever et.al. The company shares many suc-cessful case studies where neuro-marketing helped the clients tounderstand the consumer require-ments better and the results weremeasurable. One such brief thatthey received from Viac om in late2008 was that the company wantedto redefine their advertising pricingstrategy. Unlike the ongoing ap-proach of pricing TV advertising onaudience figures, which assumedthat the ads were processed simi-larly by a viewer regardless of

sales to over 8 billion pounds a year. That’s the same reason Goog-le Adwords works, as it uses itsanalytics about various sites to un-derstand which sites would be themost congruent to a particular ad-

vertisement.In a similar way, brands like Mc-

donald’s and Proctor & Gamblefound out through brain mappingthat certain smells can give birth tostrong associations. Using thesefindings, McDonald’s developeda perfume which was subtly dif-fused in restaurants to increasebrand association and boostsales. Proctor & Gamble followedthe way with a similar trick. Sales of Ariel washing powder increasedby 70% after an artificial per-fume was placed under the lid.

Remember the recent success ofPSY’s music video Gangnam Style?The song was released in July 2012and on December 21, 2012, Gang- nam Style, became the first online video to record a billion hits on theInternet and is still the most watched

video on the net. Marcelo Peruzzo,Chief Brain Officer of Brazil basedneuromarketing company ipdoisneurobusiness , decided to conducta neuromarketing research andmeasure the viewers’ reactions while

watching this video, in order to gainmore insights on what exactly madethis video so popular. He asked 20

women and 20 men to watch Gang-

nam Style while researchers fromipdois neuro-business measuredtheir reactions. They used eye track-ing of viewers’ eye movements, gal-

vanic skin responses to measure themuscular excitement level and facialcoding to understand the emotionsof those seeing the video. Using fa-cial recognition software, it wasproven that most viewers experi-enced happiness, sadness and sur-prise while watching the video, whiledisgust, anger and fear were insig-nificant – proving the power of at-traction of the video. Peruzzo alsofound that many of the scenes stim-ulate the limbic system.

On another front, neuromarket-ing is relatively cheap too. In a No-

vember 2011 study done by Entre- preneur magazine, it was found thatthe per head cost of doing an EEGor fMRI based study in the US wascheaper than using a focus group( see the comparative chart; previous

flap). However, despite all the suc-cess that neuromarketing has gainedaround the world, there are not manytakers for the concept in India. Whilemany top companies and executivesthat 4Ps B&M contacted had no ideaof this concept, there were a few sur-prising exceptions. Vishal Vyas, Sr.Marketing Manager, TTK-Protec-tive Devices Ltd. which has recentlycome up with its latest condombrand, Skore, is very positive on em-bedding neuromarketing in the mar-keting campaign when he says, “Ifthere is any scientific aid which canhelp marketers to capture consumerinsights, it is definitely welcome. Insensitive categories like condoms

where consumers are not very com-fortable talking about their experi-ences or views, neuromarketing isreally a boon.” Similar views are ex-pressed by K.V. Sridhar, NationalCreative Director, Leo Burnett India

when he says that the concept looksexciting if it can really offer a way tosupport the findings of a primaryresearch done by a human. However,he does not feel that neuromarketinghas reached that stage where it canact as a replacement to the conven-tional market research. Noted ADGuru, Prahlad Kakkar also has his

(L-R) (1) McDonald’s uses a special perfumeinside its outlets to stimulate the portionsof brain which handle things like brandassociation. (2) Images of dominant brands,such as the iPod, stimulated the same partof the brain activated by religious symbols

K.V. SRIDHAR,NCD, LEOBURNETT,SOUTH ASIA

“I do not thinkthat the field ofneuromarketinghas reached astage whereit can act as areplacement toconventionalmarketingresearch tools;yet, it holdsmuch promiseand potential”

PRAHLAD KAKKAR.CEO, GENESISCREATIONS

“I am notmuch awareof any suchtechnology; buteven if thereis anything assuch, it has tostand the test oftime and marketbefore it getsacceptance;after handlingethical issues”

VISHAL VYAS,SR. MARKETINGMANAGER, TTK-PROTECTIVE DEVICES

“Especiallyin sensitivecategorieslike condoms,whereconsumersare not verycomfortabletalking abouthis experienceor views,neuromarketingis a boon”





PRIVACY MAY BECOMPROMISED!

Can neuromarketing work?uch scientific methods can give a goodorensic insight and to an extent cut outhe ‘human’ biases. The subconscious

mind stores everything that one sees,ears, feels, and any other informationhat he or she comes across. Neuro-

marketing tests, measures and analyzeshese intents and desires. It is a great

way to understand how consumers makeecisions and what draws them to makehose decisions. However, technologyself is not entirely reliable. So am noture how accurate the results would be,part from giving broad level views ononsumer preferences.

What about intrusions into an indi-idual’s privacy? Is that worrisome?

Definitely yes. Technology is power andower lends itself to an amazing level oforruption. Using such methods some-

where has an effect on the indivi duals,hat they do not know about. Neuro-

marketing brain-scans an individual,nd manipulates subconscious motives.

Also, confidential information is ex-remely private and such information

would not be preferred to be shared byhe individual himself. Therefore, it isquivalent to going against the individ-al’s will. Moreover, advertising is al-eady considered to be a form of ma-ipulation. Neuro-marketing definitelyushes this thought to a new level ofebates and criticism.

Do you think neuromarketing caneplace human judgment?

No, I don’t think so. Besides the massiveosts, neuromarketing cannot be af-orded by all brands or by any brand atll times.

Ravikant BankaCEO,EggfirstAdvertising

reservations when he says, “I am notmuch aware of any such technologybut even if anything exists as such, ithas to stand the test of time and mar-ket before it gets full acceptance.”

Despite the general positive lightin which neuromarketing is seen, onecan not ignore the critics. Slate mag-azine’s science writer Daniel Engberraised some serious doubts about theaccuracy of the results obtained bybrain mapping and its relevance formarketers. He writes, “Scanning oneindividual’s brain and drawing shakyconclusions proves nothing. A fewpeer-reviewed studies correlatingfMRI predictions of ad effectiveness with actual consumer purchases would mute the critics and do a lotmore for industry credibility than anynumber of glossy articles that end upmaking neuromarketing look likehigh-tech phrenology.” There areother ethical and legal issues sur-rounding the area as well. As the re-searchers around the world are strug-gling to attain a go-ahead on issueslike stem cell research and cloningetc, it is very tough that attachingbrain mapping devices to someone’sbrain for a purely commercial pur-pose will find acceptance.

A recent research paper titled Onthe Feasibility of Side-Channel At-tacks with Brain Computer Interfaces uncovers potential security risks inthe use of the consumer-grade EEGheadsets. In this paper, a team of

security researchers from Oxford,UC Berkeley and the Universityof Geneva have claimed that they were able to deduce digits of PINnumbers, birth months, areas ofresidence and other personal in-formation from 30 subjects who were wearing consumer-gradeEEG headsets and who were ex-posed to images of ATM machines,debit cards, maps, people and ran-dom numbers in a series of experi-ments. Critics and researchers areeven concerned about a scenario

where a potential malicious attackercould write a brain spyware program,

which could extract private informa-tion from the user. As imaging tech-nologies progress and get coupled

with powerful and futuristic software,threats will be bigger.

Having said all this, the field of neu-romarketing is still relatively new andthere is a lot more to happen in this inthe coming times. As big brands havestarted opting for neuromarketing re-lated services, the future looks brightfor the industry. But the marketershave to come clean on issues like pri-

vacy policy, medical safety of the subjects. At the same time, more indus-try-academia collaborations are re-quired to create positive awareness onthe subject. Only then we can see thishighly potent technology going for-

ward. And as far as Indian corpora-tions are concerned, they need to startby reading this article. 4Ps

(L-R) 1. Researchers at the University of South California proved that high calorie foodstimulates the reward center of the brain, making us crave for fast food 2. A representativeimage of a subject undergoing a neuromapping experiment

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To what extent do you think neu-romarketing can find out the con-sumer intent, desires and latentdemand for a product?

Finding out what products, brands ormarketing messages consumers willrespond positively to or recall and actupon is a key part of market researchand the rapidly expanding field of neu-romarketing has a similar purpose. Butin contrast to traditional explicit mar-ket methods that capture consumersexplicit responses via, for example, fo-cus groups or explicit surveys, neuro-marketing tools are able to tap intocustomers’ subconscious responsesand reveal deep-seated emotions andimplicit biases that are not always ac-cessible through introspection.

The reason why this is important isbecause often consumers do not knowhow they feel, or say what they thinkand neither do they do what theysay. The result is that 80% or more ofall new products fail within their first year to market and often despite mil-lions of dollars spent on explicit mar-ket research. The ramifications for theindustrial economy are massive andany tools which can help better predict what people will or will not buy mustbe beneficial to both companies and

consumers.Over the past 15 years, we’ve under-taken an extensive number of commer-cial market research projects usingfunctional MRI scanners to literally“see inside” consumers’ brains as theyare exposed to different marketingmessages, across different platforms,at different times of the day; as well asto new product prototypes, new fla-

vours, fragrances and even fab-rics. The results of these studies have

“Neuromarketingtools are ableto tap intocustomers’subconsciousresponses andreveal deep-

seated emotionsand implicitbiases that arenot alwaysevident on theface of it”

consistently shown that in many cir-cumstances, people say one thing, butthe brain tells a different story – andone which is more accurate at predict-

ing how products will fare in the mar-ket. This is a significant gain over thetypical market research methods.

The reason for this is that consumersoften don’t know how they feel aboutnew products, or brands which theyhave bought for many years and whichhave become part of their everydaypurchasing habits. Other times, re-spondents want to provide positivefeedback irrespective of what they re-ally think, in order not to seem nega-tive. Neuromarketing tools bypassthese social biases and attempt to getat people’s true underlying desires andpreferences.

In some researches related to neu-romarketing, it has been observedthat the researchers were able tofind out even the confidential in-formation like ATM pins, accountpasswords etcetera from the subjects using brain mapping. Do youthink that frequent use of suchtechnology can be unethical andcan be an intrusion to an individ-ual’s privacy?

Any new technology may be open toabuse. It is up to humans how do theyuse it. However, the recently estab-lished Neuromarketing Science andBusiness Association (NMSBA), anorganisation that represents the neu-romarketing industry, has made thepublication of a Code of Ethics one ofits primary activities. The NMSBACode of Ethics was published at theend of 2012 and it is a requirement ofmembership that all neuromarketing

practitioners abide by this code. Keycomponents of this include assuranceof experimental transparency, subjectconfidentiality and respect for individuals’ privacy. In practice, neuromar-keting studies aim to find out not howa single individual responds but howgroups of consumers’ brains react to anew or existing product or serv-ice. This is partly because knowing what a single individual believes is notparticularly useful to companies mar-keting to large populations and alsobecause neuromarketing methodstypically require ( as with any other

market research) a sufficient numberof individuals’ data to ensure statisti-cally significant results.

Do you think that neuromarketingcan become a replacement of mar-ket research and human judgment, when it comes to finding out con-sumer needs and desire patterns?I do not believe that any neuromarket-ing practitioner honestly believes thatsolely capturing consumers’ subcon-scious responses is ever going to tellthe whole story about what may workand what may not, any more than rely-ing only on people’s explicit feedbackcan do. Neuroscience has made rapidprogress over the past few decades atfinding out more about how we makedecisions, what influences our think-ing, what the role of emotions are indetermining how we behave.

The consensus that is emerging isthat while complex choices and behav-iours are often driven initially by sub-conscious emotional brain processes,these can also be substantially modu-lated by the conscious brain which al-lows us to eschew short term gains inorder to achieve longer term goals. Sohuman decision-making is the out-

come of both implicit and explicit brainprocesses – only by being able to meas-ure both will marketers be able t o gainat 360 degree perspective on what liesbehind our behaviour.

In times when subjects such asstem cell research, cloning et. al.have not been able to get a go-ahead in many countries, do youthink that neuromarketing prac-tices can get through legal and po-

litical hurdles?In contrast to areas such as stem cellresearch and cloning, neuromarketingper se does not set out to alter the hu-man condition, but to better under-stand it. Naturally, appropriate regula-tion to protect respondents’ well-be-ing, privacy and to ensure transpar-ency at all stages is a prerequisite if theindustry is to survive and benefit con-sumers. Good market research is aboutfinding out what the consumers needand want so providers can deliver prod-ucts and services which match thesedesires and needs; neuromarketingcan greatly help to achieve this, whichbenefits all of us.

But the important point is that no

matter what neuroscientists learnabout the brain, or how we make deci-sions, or how our choices are influ-enced by certain cues, at the end of theday, if the product purchased does notdeliver on expectations or generate anexperience that is superior to what hasalready gone before, then our brains will ultimately reject it. In this way, ourbrains act as gatekeepers of marketingpractices.

Apart from the sci-fi loaded brainmapping techniques, what con-ventional ways have marketersbeen using to find out consumerdemands? How accurate havethese ways proved for them?Focus group, surveys and question-naires online have all proved useful at

being able to extract a partial pof how consumers think – asome of the time. On the otherneuromarketing has typicallybrain scanners, eye trackers antrodes to monitor consumers’ iit brain responses to the sametions or concepts. The formproach suffers to some extent frfact that it only captures the tipiceberg of consumers thoughfeelings, most of which occur the level of conscious awarenestherefore, often fail to predict iour. Traditional neuromarketthe other hand has been criticirequiring the use of costly brainners or unwieldy electrode caps

have negative implications in tepracticality and sc alability. A recent hybrid approach, wh

believe allows marketers to bfrom the best of both approacthe evolution of online neuroming techniques. These methodshave been developed and validater years of piloting and commtesting alongside brain scamethods, have now reached thof sophistication required to be capture people’s subconsciosponses online and with considspeed without the need for scand electrodes. These methods measuring people’s response titimescales ( milliseconds) too fthe conscious brain to kick in afluence the subconscious ( or “

stinct”) reaction.The approach involves pres

words ( eg. brand attributes, log gans) and/or images ( products, rity endorsers, new pro totypescomputer screen ( or tablet, or

phone) and requires respondereact in less than a second. Th

comes of these mini-tests provsight into consumers’ implicit and preferences across a hugeof marketing stimuli. We thebelieve that, far from the sci-fi brain mapping, the future of nmarketing lies in the integratthese easily implementable, cfective and scalable online neurketing tools with traditional quaand quantitative market remethods. 4Ps

“The NMSBACode of Ethicswas publishedin the year2012 and allneuromarketingpractitionersglobally shouldnecessarily abideby this code”

PROF. GEMMA CALVERT

MANAGING DIRECTORNEUROSENSE GROUP




C O V E R S T O R Y I N T E R N A T I O N A L C O L U M N

How do we choose? Consum-ers imagine themselves asrational decision-makers,able to weigh up the relative

costs and benefits of decisions to arrive

at reasoned choices. Yet, a growing bodyof research in psychology and the neu-rosciences suggests that learning anddecision-making are mediated bythought processes that occur “below-the-surface”.

Indeed, increasing evidence suggeststhat our decision-making is heavily bi-ased via mechanisms that are inacces-sible to deliberative thought processes.

THE ROLE OF EMOTIONS

Marketing theory and practice has longunderstood that emotions play an im-portant role in consumer decision; par-ticularly those decisions that are impul-sive, and low in cost or risk.

Now there is mounting evidence sug-gesting that hidden, emotionally biasedthought processes underpin decision-making in general, including those madeby consumers. This evidence of hiddendecision mechanisms provides a majorchallenge for marketing researchers andthe industries they supply with con-sumer insights. Historically, marketingresearch has judged consumer attitudesand likely behaviour towards products,

services and ideas based largely on whatconsumers say. Yet, organisations have long observed

a gap between consumers’ stated inten-tions and actual behaviour, and under-stood that consumer behaviour towardsproducts can be biased by decision fac-tors that simply can’t be articulated.

LOOKING TO SCIENCE

Over the past decade, researchers andcommercial organisations alike have in-

“A growingbody ofresearch inneurosciencessuggests thatlearning and

decision-making aremediated bybelow-the-surface thoughtprocesses”

creasingly looked to the use of researchmethods from the neurosciences as ameans to better understand decision-making processes.

The nascent field of “neuromarket-

ing” draws on theory and tools from theneurosciences to examine these proc-esses in the context of market exchang-es. In an early example of neuromarket-ing research, a US team led by SamuelMcClure in 2004 used functional Mag-netic Resonance Imaging ( fMRI ) to ex-amine the effects of brand exposure onconsumer preferences.

Participants preferred the taste of acola drink more when it was linked withthe market-leading brand than when it was tasted anonymously. Critically, theshift in branded preference was accom-panied by greater activation of brainregions involved in information process-ing and long-term memory encoding.Brand knowledge stored in memory ap-peared to shift taste preferences.

In a more recent neuromarketingstudy, Hilke Plassmann and other re-searchers from the California Instituteof Technology used fMRI to examine theinfluence of pricing changes on tastepreferences. In a cleverly designed study,research participants sipped and ratedred wines while in the fMRI scanner.

What the participants did not know

was that two wines offered – the “value”$10 wine and the “premium” $90 wine– were actually the same. Participantsrated the higher priced wine as tastingbetter – yet, fMRI responses in brainregions associated with taste sensationdid not change. Instead, fMRI respons-es in brain regions associated with theoverall pleasantness of the tested expe-rience were more strongly activated when prices were higher than when they were lower.

BRANDS DO INFLUENCE CHOICE

Together, these studies show thatbrands and pricing information shiftexpectations of a tasting experience, andcan bias ( even dominate) the influenceof actual taste information on shapingpreferences. Commercial organisationsseeking to capitalise on these novel con-sumer insights have drawn on a varietyof research techniques from the neuro-sciences to better understand consum-er preferences and decisions.

Some commercial organisations haveused fMRI research to examine con-sumer responses to product designs.Daimler-Chrysler, for example, spon-sored an fMRI study in which malesrated the attractiveness of car designs.Sports cars were rated as more attractivethan other car categories, and were as-sociated with greater activation of reward-related brain regions.

COMMERCIAL USES

However, the high cost, low scalability

and limited temporal resolution of fMRIdata has acted as a barrier to its more widespread commercial use.

More commonly, commercial market-ing research studies have examinedbrain electrical activity responses ( elec-troencephalography, or EEG) and otherbiophysical measures that reflect atten-tion and arousal while viewers are ex-posed to marketing stimuli, such as TVadvertisements.

Using this approach, responses

gained during exposure to products andadvertisements can be used to diagnosethe effectiveness of specific elements ofthe stimulus. For example, TV commer-cials that fail to communicate effective-ly during key moments such as the pres-entation of a brand can then be revisedbefore launching. In a recent exam-ple, Nestlé used EEG techniques as anadjunct to more traditional researchmeasures when designing a televisioncommercial.

The EEG responses identified keymoments in a confectionery ad for Al-lens that required additional viewingtime to communicate effectively. The ad was revised and launched, resulting in asales increase for the advertised brand.

CONTROVERSY

Use of neuromarketinng techis not without its critics. Althoubate has progressed beyond initicerns over undue power of marstimuli developed through thethese techniques, ethicists righpress concern over ownership aof private medical data gained thneuromarketing techniques.

Resolving this debate will be portant step in the progression fledgling field. Other questions cthe extent that biophysical measube captured in commercially viabtings and still provide reliable andmarketing research constructs.

Peer-reviewed articles supportutility of these measures for marresearch are scarce, but increasi

Neuromarketing organisationalso responded with an industrproject that will formulate instandards. Not all neuromarketganisations have played ball, how

Still, the use of neuromarketinniques is on the rise and we shopect to see more informed policyopment regarding how it is umarketing.

Importantly, knowledge through the use of these scientificods will provide both consumemarketers alike with a better ustanding of the role played by ubiqcommercial stimuli in our evdecision-making.4Ps

“The high cost,low scalabilityand limitedtemporalresolution of fMRIdata has actedas a barrier to itsmore widespreadcommercuse use”

In an early example of neuromarketing research, a U S team led by Samuel McClure in 2004 used functional Magnetic ResonancImaging (fMRI) to examine the effects of brand exposure on consumer preferences. Participants preferred the taste of a cola drinwhen it was linked with the market-leading brand than when it was tasted anonymously.

DR PHIL HARRIS

LECTURER, FACULTY OF BUSINESSAND ECONOMICS,UNIVERSITY OF MELBOURNE

IF YOU THINK YOU KNOW WHAT YOUARE THINKING, YOU’RE WRONG!NEUROSCIENCE IS AN AREA THAT HAS ONLY BEEN TOUCHED TRIVIALLY BY

RESEARCHERS GLOBALLY. DR. PHIL HARRIS ARGUES WHY THIS MAY BE ONE OF THE

MOST CRITICAL TOOLS TO UNDERSTAND MERCURIAL HUMAN BEHAVIOUR



C O V E R S T O R Y I N T E R N A T I O N A L P E R S P E C T I V E S

76 4Ps BUSINESS AND MARKETING 15 FEBRUARY - 14 MARCH 2013

They say that neuromarketing canone day even find out what the con-sumer desires and wishes for, bet-ter than what the consumer himself

would be able to do. Do you thinksuch a scenario is realistic?Neuromarketing is a relatively youngfield. In the last decade or so, peer reviewed experiments have provided keyinsights that have helped us under-stand the neural mechanisms of atten-tion, self-relevance of an offer, how thebrain assesses the value or utility of adecision and ultimately chooses to en-gage or ignore an offer. However, moreresearch is needed to confirm some ofthe early conclusions.

There has always been some or theother debate on the ethics of allthis. In some researches related toneuromarketing, researchers wereapparently able to elicit private in-formation ( passwords, pins etcetera ) from the subjects using brainmapping. That’s raised some hack-les and some quarters are ques-tioning the unsolicited intrusion ofprivacy that may occur in this field.How do you feel this would pan outin the future?I am not aware of the research you arequoting nor do I think it is possible toretrieve such information via neuro-marketing methods. I do think thatneuromarketing professionals have tofollow a code of ethics and I am one ofthe main authors of the code of ethicsadopted by the Neuromarketing Sci-ence and Business Association. Hence,I believe that the neuromarketing prac-tices cannot be threatening to that ex-tent as described by you.

But do we see this field as being thefuture of today’s market research?

And does this have the potential tocompletely replace market re-search to determine human behav-iour more precisely than tradition-al techniques?I think neuromarketing research provides critical insights that are not pos-sible to generate using conventionalmethods. Therefore, I recommend thatmarketers include neuromarketingmethods and mix them with other re-search protocols to the extent that theycan afford to do so.

Every new area that has a radicalnature (aka stem cell research ) hasrun foul of powers that be. How doyou believe the legal and politicalramifications would be?

As long as research is conducted ac-cording to the highest ethical standardsby competent researchers, I don’t seeany reason why neuromarketing re-search should face legal and politicalresistance. However, we need a con-tinuous endeavour to ensure that thesehighest standards are never compro-mised in any situation.

Leaving aside brain mapping, arethere other nouveau methods todetermine consumer buying be-haviour accurately?I believe that learning how consumersmake decisions can in fact help us tocreate a society in which we are moremindful of the risk and excesses ofconsumerism. For instance, I am cur-rently investigating the neurophysio-logical effect of advertising messageson adolescents because I believe thatregulation does not protect youngconsumers adequately from stealthmarketing techniques, especially forproducts like tobacco, alcohol and

junk food. 4Ps

"I believe thatlearning howconsumersmake deci-sions can help

us to create asociety whichis mindful ofthe risk andexcesses ofconsumerism.”

MORIN, WHO HAS BEEN ONE OF THE MAIN AUTHORS OF THE NSBA CODE OF ETHICS FORNEUROMARKETING PROFESSIONALS, PRESENTS HIS VIEWS TO 4PS B&M

“WE NEED TO ENSURE STANDARDS

ARE NEVER COMPROMISED WITH”

CHRISTOPHE MORIN

CEO, SALESBRAIN

ADJUNCT FACULTY,

SCHOOL OF PSYCHOLOGYFIELDING GRADUATE UNIVERSITY

NEUROMARKETING, INGLES.pdf

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