Our brains, our wallets – the field of neuromarketing

How do we choose? Consumers imagine themselves as rational decision-makers, able to weigh up the relative costs and benefits of decisions to arrive at reasoned choices.

Yet a growing body of research in psychology and the neurosciences suggests that learning and decision-making is mediated by thought processes that occur “below-the-surface”.

Indeed, increasing evidence suggests that our decision-making is heavily biased via mechanisms that are inaccessible to deliberative thought processes.

The role of emotions

Marketing theory and practice has long-understood that emotions play an important role in consumer decisions, particularly those decisions that are impulsive, low in cost or risk.

Now there is mounting evidence suggesting that hidden, emotionally biased thought processes underpin decision-making in general, including those made by consumers.

This evidence of hidden decision mechanisms provides a major challenge for marketing researchers and the industries they supply with consumer insights.

Historically, marketing research has judged consumer attitudes and likely behaviour towards products, services and ideas based largely on what consumers say.

Yet organisations have long observed a gap between consumers’ stated intentions and actual behaviour, and understood that consumer behaviour towards products can be biased by decision factors that simply can’t be articulated.

Looking to science

Over the past decade, researchers and commercial organisations alike have increasingly looked to the use of research methods from the neurosciences as a means to better understand decision-making processes.

The nascent field of “neuromarketing” draws on theory and tools from the neurosciences to examine these processes in the context of market exchanges.

In an early example of neuromarketing research, a US team led by Samuel McClure in 2004 used functional Magnetic Resonance Imaging (fMRI) to examine the effects of brand exposure on consumer preferences.

Participants preferred the taste of a cola drink more when it was linked with the market leading brand than when it was tasted anonymously.

Critically, the shift in branded preference was accompanied by greater activation of brain regions involved in information processing and long-term memory encoding. Brand knowledge stored in memory appeared to shift taste preferences.

In a more recent neuromarketing study, Hilke Plassmann and other researchers from the California Institute of Technology used fMRI to examine the influence of pricing changes on taste preferences.

In a cleverly designed study, research participants sipped and rated red wines while in the fMRI scanner.

What the participants did not know was that two wines offered at different price points – the “value” $10 wine and the “premium” $90 wine were actually the same.

Participants rated the higher priced wine as tasting better – yet fMRI responses in brain regions associated with taste sensation did not change.

Instead, fMRI responses in brain regions associated with the overall pleasantness of the experience were more strongly activated when prices were higher.

Brands do influence choice

Together these studies show that brands and pricing information shift expectations of a tasting experience, and can bias (even dominate) the influence of actual taste information on shaping preferences.

Commercial organisations seeking to capitalise on these novel consumer insights have drawn on a variety of research techniques from the neurosciences to better understand consumer preferences and decisions.

Some commercial organisations have used fMRI research to examine consumer responses to product designs.

Daimler-Chrysler, for example, sponsored an fMRI study in which males rated the attractiveness of car designs.

Sports cars were rated as more attractive than other car categories, and were associated with greater activation of reward-related brain regions.

Commercial uses

However, the high cost, low scalability and limited temporal resolution of fMRI data has acted as a barrier to its more widespread commercial use.

More commonly, commercial marketing research studies have examined brain electrical activity responses (electroencephalography, or EEG) and other biophysical measures that reflect attention and arousal while viewers are exposed to marketing stimuli, such as TV advertisements.

Using this approach, responses gained during exposure to products and advertisements can be used to diagnose the effectiveness of specific elements of the stimulus.

For example, TV commercials that fail to communicate effectively during key moments such as the presentation of a brand can then be revised before launching.

In a recent example, Nestlé used EEG techniques as an adjunct to more traditional research measures when designing a television commercial.

The EEG responses identified key moments in a confectionery ad for Allens that required additional viewing time to communicate effectively. The ad was revised and launched, resulting in a sales increase for the advertised brand.

Controversy

Use of neuromarketing techniques is not without its critics. Although debate has progressed beyond initial concerns over undue power of marketing stimuli developed through the use of these techniques, ethicists rightly express concern over ownership and use of private medical data gained through neuromarketing techniques.

Resolving this debate will be an important step in the progression of this fledgling field.

Other questions concern the extent that biophysical measures can be captured in commercially viable settings and still provide reliable and useful marketing research constructs.

Peer-reviewed articles supporting the utility of these measures for marketing research are scarce, but increasing.

Neuromarketing organisations have also responded with an industry-wide project that will formulate industry standards. Not all neuromarketing organisations have played ball, however.

Still, the use of neuromarketing techniques is on the rise and we should expect to see more informed policy development regarding how it is used in marketing.

Importantly, knowledge gained through the use of these scientific methods will provide both consumers and marketers alike with a better understanding of the role played by ubiquitous commercial stimuli in our everyday decision-making.

Philip Harris is a lecturer in Marketing at University of Melbourne.

This article first appeared at The Conversation.

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