Neuromarketing Science & Business Association (NMSBA)

Articles and Blogposts

  • October 07, 2013 10:21 | Carla Nagel (Administrator)

    A lot is known about two types of mental processes in the brain: System 1 and System 2. The former is concerned with subconscious, automatic reasoning, whereas the latter is concerned with conscious, intentional more deliberate type of reasoning.

    Just as these two systems can be regarded as ‘complementary opposites’ to each other, they can have very distinct applications in marketing.

    Because system 1 specializes in making fast (subconscious) judgments, the retail environment with its hundreds of same-category products requires that the emphasis should be on utilizing the skills of System 1. When a customer enters a retail store, the abundance of lights, colors, signage and sounds can distract the customer insofar as there are no unique stimuli that can draw the customer’s full, undivided attention that ultimately results in a purchase.

    A company’s products, therefore, needs to be sufficiently unique in terms of design, contrast (with competitive brands), readability etc. so that the impatient customer is ‘allowed’ to use the fast-thinking System 1 when crawling the isles in search of the right product and thereby making a quick decision.

    Werner is the founder of Neuromind Marketing in South Africa.
  • October 01, 2013 10:19 | Carla Nagel (Administrator)

    Serie: Quick Neuro Wins for Retailers.
    Neuro Retail Revolution speakers share their tips. Part 5: social media

    sarafay

    Attract recommendations.
    Showing the opinions of other people, even complete strangers, influences purchase decisions. Including recommendations in your online shop can increase the purchase volume by 20% or more. The inclusion of the fans profile photo can bolster this a further 10%. Free gifts trigger reciprocity: offer a free gift in exchange for recommendations and increase your sales turnover and loyal customers at the same time. Use social media to make it super easy for your customer to endorse your brand and share information at the same time.

    Sara Fay is founder of Whitematter Marketing in the United Kingdom.

    This tip appeared in an article about retailing in the quarterly Neuromarketing Theory & Practice.
  • September 24, 2013 10:17 | Carla Nagel (Administrator)
    Expectations can determine the perception of your product. Setting that expectation and spreading it is the next step, but beware of trickery.

    Consumers are constantly told that the latest Nike running shoes or Mercedes-Benz can offer higher performance. Consumers believe it, they make a purchase and they even experience it. From sportswear to cars, expectations of a product or service can actually create a resulting experience. But how?

    Even the savviest and most jaded consumers rarely approach a new product with complete objectivity. A multitude of factors tell us what to expect, including price, packaging and the product’s ad campaign, among others.

    But just how powerful are these expectations in shaping customers’ thoughts about what they consume? And how do they influence future behaviour and sales? Pre-consumption expectations about a product affect more than what we say, or even what we think, about that product. Our biases are reflected in our brain activity, affecting our perceptions of what we consume at a deeper and more direct level than psychologists can measure, says Hilke Plassmann, Assistant Professor of Marketing at INSEAD speaking about her recent paper How Expectancies Shape Consumption Experiences, co-authored by Tor D. Wager of the University of Colorado at Boulder.

    An MRI/Wine Tasting
    Plassmann’s conclusions stem from a study she co-conducted in 2008 measuring neural responses to drinking wine. Participants were instructed to sample various wines through a straw from inside an MRI machine. The rub? The researchers deliberately misled participants about the prices of the wines, claiming one cost US$45 when it actually cost US$5 and presenting another as costing US$10 when it really retailed for US$90.

    “This allowed us to observe their brain activity while they were consuming the wine,” Plassmann told INSEAD Knowledge in an interview. “Are they rationalising after the fact that it should be better because it’s more expensive, or does it really change their taste processing? What we found is that it really changes the neural activity in an area called the medial orbitofrontal cortex, which is an area that encodes our experience of pleasure.”

    These results came as a surprise to some of Plassmann’s collaborators on the study. “Some of us were thinking, ‘Oh, it’s more like rationalisation; it’s more like a cognitive process.’ At this point it was an open question. We had competing hypotheses.”

    For Plassmann, the findings highlight the speed with which humans form lasting impressions that synthesise all types of data. “The bias kicks in at a very early stage,” she says. “It really changes your taste perception, or your visual perception, or your pain perception. These are complex processes where you receive a lot of input, and such information that has nothing to do with the taste itself – they are so fast, and integrated more holistically into your experience that you can’t distinguish. You think it’s linked to the taste.”

    Read more at: http://knowledge.insead.edu/business-finance/marketing/turning-expectations-into-customer-satisfaction-2606#1sssRUjlGt3ehV7H.99


  • September 16, 2013 10:15 | Carla Nagel (Administrator)

    Serie: Quick Neuro Wins for Retailers. Neuro Retail Revolution speakers share their tips. Part 4: visual attention on websites


    stevegenco

    Check for bottom-up visual attention. Extensive eye-tracking research has documented that bottom-up attention is automatically activated, without conscious control, immediately when a person sees something new in his or her visual field. 

    People unconsciously divide web pages into areas of promise. Some features of viewed objects are naturally visually salient, which means they automatically attract bottom-up visual attention. Examples are: brightness relative to background, distinct borders, the center of the viewing area, tight groupings of visual objects, overlapping items, movement (especially around the edges), faces and locations where faces are looking. 

    These automatic attractions are so predictable that we can find good results without eye-tracking. The software can deliver up to 80% accuracy compared to a real eye-tracking study, which saves a lot of money.” 

    Steve Genco is a director at Intuitive Consumer Insights. He is co-author of Neuromarketing for Dummies.

    This tip appeared in an article about retailing in the quarterly Neuromarketing Theory & Practice.

    Serie: Quick Neuro Wins for Retailers. Neuro Retail Revolution speakers share their tips. Part 4: visual attention on websites

    Check for bottom-up visual attention. Extensive eye-tracking research has documented that bottom-up attention is automatically activated, without conscious control, immediately when a person sees something new in his or her visual field. 

    People unconsciously divide web pages into areas of promise. Some features of viewed objects are naturally visually salient, which means they automatically attract bottom-up visual attention. Examples are: brightness relative to background, distinct borders, the center of the viewing area, tight groupings of visual objects, overlapping items, movement (especially around the edges), faces and locations where faces are looking. 

    These automatic attractions are so predictable that we can find good results without eye-tracking. The software can deliver up to 80% accuracy compared to a real eye-tracking study, which saves a lot of money.” 

    Steve Genco is a director at Intuitive Consumer Insights. He is co-author of Neuromarketing for Dummies.

    This tip appeared in an article about retailing in the quarterly Neuromarketing Theory & Practice.

  • September 12, 2013 10:13 | Carla Nagel (Administrator)

    Serie: Quick Neuro Wins for Retailers. Neuro Retail Revolution speakers share their tips. Part 3: involve your employees.

    Karin Glattes: "Turn your employees into ambassadors"

    karinglattesInvolve your employees. Shopping is a human emotion. Your employees are the ones who can evoke this emotion on an everyday basis in your clients. Stop talking about the shopping experience that you want to offer, and let them feel, smell, touch and experience what you are talking about. Give them a feeling of what you are aiming at, in your own stores and those of others. Many workers will change their daily routines immediately when they actually experience the goal their boss is aiming to achieve.



    Karin Glattes is a director at Unternehmen Kunde

    This tip will appear in an article about retailing in the next edition of the quarterly Neuromarketing Theory & Practice.
  • September 09, 2013 10:09 | Carla Nagel (Administrator)

    Serie: Quick Neuro Wins for Retailers. Neuro Retail Revolution speakers share their tips. Part 2: brochures.

    Martin de Munnik: “Get more ROI on your brochures”

    Neuroresearch shows that 80% of all brochures fail to activate a buying intention. Most often retailers forget to make one or more promises that appeal to and activate the consumer.

    martin neurrroThey also often forget to envisage their target audience themselves, which means that the brain cannot activate its mirror function. To be more effective a retailer should do as follows.


    1. Offer a reward. The brain is very sensitive to rewards, so make a promise that shows what the consumer will gain.
    2. People always mirror themselves in others: show people visuals of happy consumers making successful use of the product.
    3. Justify your discounts: make them credible. Customers want to know why you are offering a discount, and why you are doing so now. Better brochures could save the retail industry a lot of money: looking at the Netherlands alone, retailers spend more than €7O0 million a year on brochures.


    Martin de Munnik is managing partner at Neurensics

    This tip will appear in an article about retailing in the next edition of the quarterly Neuromarketing Theory & Practice.
  • September 06, 2013 10:06 | Carla Nagel (Administrator)
    Serie: Quick Neuro Wins for Retailers. Neuro Retail Revolution speakers share their tips. Part 1: pricing

    Kai-Markus Mueller: “Involve the pricing story and environment”

    kai neurrro

    Humans rarely perceive things in absolute terms. Most things we see are influenced by their surroundings or by what we have seen in the past. Interestingly, even the way we perceive numbers is biased in this way. There is a category of numbers that is highly relevant for market success: prices. A product placed withing a plethora of higher priced products seems to be a good deal, while when placed among cheaper alternatives it will appear overpriced. A slice of basic chocolate cake at a price of €2.50 at a fancy pastry shop may seem cheap because it is surrounded by many expensive pastry creations. A slice of chocolate cake for the same price sold at the bakery next door, where a muffin or a brownie costs just €1, makes the cake appear overpriced.

    It is fascinating that this effects remains even if the perceptual distortion is well-known. In one study subjects were explicitly informed about such biases. The participants' number estimates were still influenced by previously shown numbers. Because prices are somewhat arbitrary numbers associated with a product, they are especially susceptible to their surrounding and to surrounding prices.

    Kai-Markus Mueller is MD of The Neuromarketing Labs in Germany one of the speakers on the Neuro Retail Revolution

    This tip will appear in an article about retailing in the next edition of the quarterly Neuromarketing Theory & Practice.
    Via Radboud University Nijmegen


  • August 26, 2013 10:04 | Carla Nagel (Administrator)

    A new method of analyzing MRI brain images enables researchers to determine which letter a test subject was looking at.

    brain scan letters
    Image courtesy of Radboud University Nijmegen

    By analyzing MRI images of the brain with an elegant mathematical model, it is possible to reconstruct thoughts more accurately than ever before. In this way, researchers from Radboud University Nijmegen have succeeded in determining which letter a test subject was looking at.

    The journal Neuroimage has accepted the article, which will be published soon.

    Functional MRI scanners have been used in cognition research primarily to determine which brain areas are active while test subjects perform a specific task. The question is simple: is a particular brain region on or off? A research group at the Donders Institute for Brain, Cognition and Behaviour at Radboud University has gone a step further: they have used data from the scanner to determine what a test subject is looking at.

    The researchers ‘taught’ a model how small volumes of 2x2x2 mm from the brain scans undefined known as voxels undefined respond to individual pixels. By combining all the information about the pixels from the voxels, it became possible to reconstruct the image viewed by the subject. The result was not a clear image, but a somewhat fuzzy speckle pattern. In this study, the researchers used hand-written letters.

    Prior knowledge improves model performance

    “After this we did something new’, says lead researcher Marcel van Gerven. ‘We gave the model prior knowledge: we taught it what letters look like. This improved the recognition of the letters enormously. The model compares the letters to determine which one corresponds most exactly with the speckle image, and then pushes the results of the image towards that letter. The result was the actual letter, a true reconstruction.”

    “Our approach is similar to how we believe the brain itself combines prior knowledge with sensory information. For example, you can recognise the lines and curves in this article as letters only after you have learned to read. And this is exactly what we are looking for: models that show what is happening in the brain in a realistic fashion. We hope to improve the models to such an extent that we can also apply them to the working memory or to subjective experiences such as dreams or visualisations. Reconstructions indicate whether the model you have created approaches reality.”

    Improved resolution; more possibilities

    “In our further research we will be working with a more powerful MRI scanner,” explains Sanne Schoenmakers, who is working on a thesis about decoding thoughts. “Due to the higher resolution of the scanner, we hope to be able to link the model to more detailed images. We are currently linking images of letters to 1200 voxels in the brain; with the more powerful scanner we will link images of faces to 15,000 voxels.”
  • August 14, 2013 10:02 | Carla Nagel (Administrator)

    What does a bookstore smell like? If you frequent used or antiquarian book sellers, you probably think of musty paper, perhaps with an occasional mildew note. In big box bookstores like Barnes & Noble, the predominant aroma is often a pleasant espresso smell from the coffee bar. But, all of these retailers need to rethink their scent environment – a new study to appear in the Journal of Environmental Psychology shows that infusing a chocolate scent into a bookstore kept shoppers browsing longer and inspecting more merchandise.

    ChocolateResearchers in Belgium monitored customers in a bookstore both with and without a subtle chocolate aroma. They found a significant effect on shopper behavior. When the scent was present, shoppers were:


    More than twice as likely to examine multiple items
    More than twice as likely to read synopses for multiple books
    Nearly three times as likely to interact with store staff
    Less than half as likely to seek out one item and go directly to the register

    The scientists also found that items “congruent” with the aroma of chocolate, food-related books and romance novels, saw an uptick in interest from female shoppers. There was an indication of a positive effect on sales, but the data was insufficient to draw a conclusion.

    They did note that customers browsed non-congruent categories less when the scent was present, so chocolate scent isn’t a panacea for every retail sales environment.
    Still, this study offers more evidence that subtle changes in environment can affect customer behavior. Music, too, can have an impact. In Audio Branding: ‘Tis the Season, I describe how a wine shop sold four times as much French wine when French music was playing in the background.

    What should retail stores do? While chocolate scent might be a good choice for a generally pleasant smell, dispersing an aroma that relates to the products for sale would likely be better. Selling hunting gear? Perhaps a woodsy pine scent. Similarly, a seaside aroma might work for a swim shop.

    Chocolate scent may not be enough to reverse the decline in bookstore sales, but this study points the way to keep customers in any retail environment shopping longer and looking at the merchandise more closely.

    Roger Dooley is the author of Brainfluence: 100 Ways to Persuade and Convince Consumers with Neuromarketing (Wiley, 2011) and one of the speakers of last year's edition of the Neuromarketing World Forum in São Paulo. Find Roger on Twitter as @rogerdooley and at his website,Neuromarketing.

    This article originally appeared at Forbes.com: Keep Your Customers Shopping... With Chocolate!
  • August 08, 2013 09:58 | Carla Nagel (Administrator)

    The role of marketers is to influence consumer behaviour, both short- and long-term, in favour of the brands they manage. We need to retain our customer base, increase purchase frequency and turn non-users into users. Therefore the question of why consumers buy what they buy, and the search for what it is that determines their choices, are at the core of marketing.

    In a ground-breaking experiment (see figure 1), neuroscientist Brian Knutson, Professor at Stanford University, and his colleagues (2007) wanted to find out if it was possible to predict purchase behaviour by analyzing neural activity. His research began with images of products and brands undefined for example a box of chocolates undefined shown for a few seconds. Then, additionally, the price appeared on the screen, and finally the respondents had to state, by pushing a button, whether they would buy the chocolates or not.

    figure 1

    Figure 1 Illustration of the classic neuro- economics study ‘Neural predictors of purchases’ by Knutson and his colleagues from Stanford University

    Brain activities were measured the entire time using brain imaging (fMRI). This showed that the picture of the product or brand increases the activation of the so-called ‘reward system’, which is known to be triggered when we value something. It’s as if the brain says, ‘I want to have this.’ This wanting is based upon the value that we expect the product to deliver. In our associative memory we have experiences with the brand undefined from using it directly or indirectly, from processing its advertising or from seeing other people using it. Based on this associative learning we have an expected value delivered by the brand. If this expected value is high, then the reward system shows a high level of activation. If the value is low, then the level of activation will also be low.

    Now what happened when the price was also shown? When the price was exposed to the respondents, an entirely different area of the brain was activated, namely the insula. This area is normally activated when we experience pain undefined for example, when we cut our finger (physical pain) or if we are excluded from a group (social pain). In other words, when looking at price, the brain experiences pain undefined so that means that price isn't anything rational. Price is hot! Price is pain. To explain this we have to be aware that there is no ‘shopping’ module in the brain, nor is there a ‘buy button’ or a brand module. Rather, the brain has to ‘decide’ which of its existing neural modules, all developed for reasons totally different than shopping, should deal with products, brands and prices. The result makes intuitive sense. Products and brands reward us because they help us to achieve our goals. Prices imply giving away something we already own, and which is of significant value to us: money. That this is coded as a painful experience seems reasonable.

    The scientists then uncovered the underlying principle that determines whether the brand or product will be bought or not. The principle they found is strikingly straightforward: if the relation between reward and pain exceeds a certain value, the respondents are willing to purchase this item for this price. Our brain calculates a kind of ‘net value’ and if this is high enough, if the difference between reward and pain is great enough, then we buy. Based on this principle the scientists were able to accurately predict whether the respondents would buy these products or not, hence the title of their paper, ‘Neural predictors of purchases’.

    Knutson's results show that purchase decisions are based on a reward-pain relationship. This means that in marketing we have to levers to influence consumer decision making - reward and pain - and that they can be independently addressed. In order to make consumers buy, we can increase reward and at the same time decrease pain. It’s not uncommon, though, for marketers to adopt a dualistic mindset. For us, the question is whether to focus on the brand or, for example, on a special price offer, as if there were a dilemma in doing both. There isn't. The goal is to increase the ‘net value’ the brain calculates based on the expected reward of the product and the price. This enables the same piece of advertising to focus on the value that the brand or service offers but also to include a ‘hard sell’ price message (such as ‘for a limited period 30% off’). The first message increases the expected reward, the second reduces the pain, and the unity of both increases the net value.

    This simple but fundamental basis of decision making explains why Starbucks can command a premium price for its coffee, or why some people will pay three-figure sums for designer sunglasses. The reward triggered by the brand increases the perceived value, which makes us less resistant to the higher price. The price is higher but, correspondingly, the reward is too, so that, subjectively, a better value - cost relationship exists than that for cheap sunglasses.

    Source: Few pages from Decoded, The Science Behind Why We Buy

    phil bardenPhil Barden (Managing Director, Decode marketing ltd) is a proven marketer with over 25 years' experience including senior and international roles at high profile companies such as Unilever, Diageo and T-Mobile. He is the local NMSBA representative in the UK, speaker at the Neuro Retail Revolution on 3-4 October 2013 in Amsterdam and the author of Decoded, The Science Behind Why we Buy.
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