Ten Practical Neuromarketing Insights You Can Use Right Now

In 1999, researchers did a simple wine purchase experiment inside a supermarket.

Music

Near a display of French wines and German wines, the researchers played French music one day, and German music on the alternate days. They did this for two weeks. Guess what happened?

You’re right! On the days French music was played, the store sold three times more French wine than German. On the days German music was played, the store sold three times more German wine.

No surprises there, I guess. Except that—

They also asked every shopper who bought a bottle of French or German wine this survey question:

“What factors influenced you to buy the French / German wine?”

Only one person in 44 chose the music as having any effect!

The study just goes to show two things.

Key Learning 1: Obviously, music can influence purchase decisions and mood, so you should start using it in your servicescape. I don’t mean tune the room into commercial radio or some garbage, be selective and set the tone. Good music can vivify and enhance purchase spend, but bad music can make you feel angry or annoyed. In fact, every time Fleetwood Mac comes on the radio station of my local Vinnies, it’s time to leave. Likewise, my favourite cafe at the moment (Esca in Glebe Point Rd) often plays St Germain in the mornings when I grab my takeaway soy flat white. It’s music I play at home and it makes me feel relaxed and happy. Want a cookie with that? Sure.

Key Learning 2: There is a big difference between people’s behaviour and their understanding of that behaviour. From this, we can even postulate that asking people questions, even in depth interviews, will give you flawed data every time. There is a whole world that exists in the brain that is below our awareness levels. Talking about why we do things just doesn’t cut it. People cannot tell you what they think. Not that they don’t want to, they can’t. So with that in mind, if you think something could work, try it. Forget asking customers. Just introduce it and judge from the results.

Happy Faces

Although subliminal advertising is not legal in Australia, research has shown that flashes of happy faces can generate up to triple the price for a mystery drink. The real-world self-service vending machine study also showed that people changed their consumption behaviour after the happy flashes (drinking more). Those who saw the unhappy faces, even though they could not consciously detect them, drank less.

Key Learning 3: Positive, genuinely happy staff is gold dust. Happy staff equals happy customers equals higher profits.

Key Learning 4: Both the music study and the subliminal faces study both go to show that a positive environment and positive feelings, no matter how small, have an impact on consumers sense of value. Want to be perceived as offering more value? Be more positive. Smile and set a happy scene.

Eye Tracking

Although big businesses spend big money on eye tracking, we can learn from their research.

Eye movements are a reliable indicator of attention. If you have the budget, it’s a useful measure for things like:

  • advertising design
  • web design
  • store design
  • packaging design

Some companies seek permission to get into your webcam so they can track your eyes on a beta website, for example.

Observe Closely

Key Learning 5: Watch people. Watch what they look at. Observe. Did you notice that customers often find trouble locating the pasta sauce? Move it. You can quite easily and inexpensively do observational research to see if your store design is working well, or simply use (and watch) people testing your website or looking at mockups of different window, poster, or newspaper ad designs. Do your A/B split tests.

Logo Positions

By the way, eye tracking reveals that if a logo is used on the bottom of the ad, many people won’t see it. You may want to watermark it right through the centre instead, or incorporate the branding more creatively within the body of the ad. If there’s a big Helena Christensen flashing cleavage in the centre of the ad, people will remember the model, but they won’t necessarily connect her with the brand name at the bottom right hand corner. Same can be said for calls to action. Why do they have to be at the bottom?

Use Faces

Key Learning 6: The most compelling thing a human being can look at is the face of another human being. Especially the eyes. Both genders will also look at things like cleavage, however. People are curious. Use people in your marketing material wherever you can. Faces capture attention.

Arousal Methods

When people are emotionally aroused (in whatever capacity), changes in the sympathetic nervous system are automatic.

This can include pupil dilation, increased heart rate, breath, sweat glands.

The emotional arousal is primitive. We are either attracted or want to withdraw from the stimulus.

Physiological tests of pupils, sweat glands, heart rate, and breathing can indicate arousal, but can’t indicate whether the arousal is positive or negative.

Key Learning 7: A simple skin conductor test on the palm of a hand can reveal any arousal to a stimulus such as a picture of a food product, or an advertisement, but it won’t tell you if they like it or not. So is that information in itself something you can act on? All marketing research needs to yield information upon which you can base a decision. In my opinion, physiological tests of heart, pupils, sweat, and breath are unlikely to be of benefit most of the time.

Facial Recognition

There is software that detects whether a person, even with a somewhat neutral expression, is happy or sad.

Companies have used this in doing user experience (UX) tests for websites.

Key Learning 8: What the face reveals can be accurately decoded by software, but it can also be understood by any curious and perceptive human being. Look at the expressions on their faces. Sure you can video record your store, but why would you. Plus, it’s a privacy thing. Just get in there and mingle. Try looking at clients and customers when you are explaining that technical process or the different packages you offer.  Do they fade away in boredom at certain points? Do there eyes go into deep focus? Do they look scared when you start talking fees and charges and scales of member benefits? Do they outright tell you they didn’t understand? Dumb it down then, folks. If you can’t explain something in simple terms, then you don’t understand it well enough.Or, if your customers don’t understand it easily, it’s too complicated.

Confusion is death. It’s a copywriting mantra, but same goes for a web design. If the user can’t get to what they’re seeking quickly, they will usually leave your website within a matter of seconds. Forever.

Do your customers look happy? Do they express delight? If you have a physical presence, there are so many ways you can setup people to have a positive emotion. Christmas tree with donated presents? A train set? Mood lighting? Classic TV programming? Scent? Comfortable chairs?

Online – increase the size of your web font. Make it easy to read, not gimmicky. Follow my mantra; if in doubt, Open Sans. Make buttons bigger and colourful. Make a change and watch your customers faces before and after. You might want to check out the Designing Servicescapes article for good ideas.

Brain Signals

The marketing concept of value lives in the brain. When people make decisions, brand memories serve as neural connections. Strong connections are better for the brand. An unknown brand will have few memories and be able to generate only the weakest neural connections.

Based on brand memories, value signals will be sent to the front of the brain where decisions are made. The strongest value signal wins.

Electroencephalography (EEG) scans have been able to reveal a more accurate price point for university students’ on-campus cups of latte macchiato than questionnaire results found.

Key Learning 9: If you can’t afford EEG to set a price point for maximum demand and profitability, consider using a real world test of different price points and look at the elasticity of your demand. Then use regression techniques with Excel or similar software to make forecasts.

A study that used functional magnetic resonance imaging machine (fMRI) has revealed that the brain activity processing value signals can often be different to what a person says, even when they aren’t lying. Brain chemistry doesn’t lie. Read about this classic neuromarketing experiment that used MRI and the startling power of brand effects.

Key Learning 10: The cultural power of a strong brand is not contested. Brands insinuate into the nervous system. Cultural information and memories impact our perceived value and our decision-making. Only the ignorant would say that a brand has no value because it’s intangible.

So the last key learning is this: make good memories. It doesn’t matter what your budget is, provide clear branding images that are consistent with style, typeface and colour schemes. Good brands tell a good story. They create good experiences. It’s all pretty common sense, I guess. But common sense is not common practice. Make every customer experience a good new memory and you’re on your way to building some good cultural capital. If it’s an emotional experience, like the arts can deliver, that memory may just may serve you well in someone’s decision-making process twenty years from now.

Sources:

Phil Harris, “Neuromarketing” Presentation at Australian Marketing Institute, Sydney, April 2014. Check out Nurobrand’s website if you are looking to introduce neuromarketing metrics into your organistion.
North, Adrian C.; Hargreaves, David J.; McKendrick, Jennifer “The influence of in-store music on wine selections.”Journal of Applied Psychology, Vol 84(2), Apr 1999, 271-276
Neuropricing http://www.neuromarketing-labs.com/services/neuropricing/the-latte-macchiato-experiment/

May 26, 2005Face Value: Hidden Smiles Influence Consumption And Judgment: Psychology Studies Confirm Unfelt Emotion Can Alter Consequential Behavior”

 

 

 

How to Add Value to your E-Business

If marketing is the interface between an organization and the marketplace, the value exchange is the driver of business.

‘Value’. You hear it time and again. Value proposition, value creation, adding value…let me take a moment to just repeat a key point–

Value exchange is the driver of business.

Value can be roughly defined as the advantage that a buyer (or user if there is no transaction) perceives that they gain from you. This could be the perception of worth that a user feels they get from your product (or service or information) minus the price and effort.

In order to create, communicate and deliver value to customers, we need to locate where value can be added or unlocked all the way along the supply chain to the customer and then into after-sales support and customer service.

In this sense, Marketing Departments are, and should be, disappearing because marketing is located in each of its parts: logistics, inputs, business development, operations, communications and customer service, and is the sum of the whole.

Regis McKenna famously wrote that “Marketing is everything and everything is marketing.”

Understand what ‘Value’ means to your customers

In order to deliver value, we must first understand what Value means to your customers. It may not be the price alone. Other factors to research when developing a Customer Persona could include:

  • time
  • ease
  • convenience
  • speed
  • access
  • customization
  • physical contact with a person
  • sense of trust and security

In fact, looking at this list, where do the four Ps of marketing fit? What happened to Product, Price, Place and Promotion? Is this redundant now?

Not really. We just have a broader variety of things to think about.

Products

Products can include information, or a service, anything we can provide in exchange for something of value to us (money, information, an audience).

Pricing

Pricing now far more flexible and complicated than in years past. Products and services may be free (Dropbox, Gmail), or scaled in some way(personal, professional, enterprise), or even time-based (variable pricing for booking of tickets due to demand).

Placement / Distribution

Considerations for E-Business are much broader now. Do we have one central fulfillment centre or a network of regional centres?

Promotion

It is far less acceptable to consumers to be bombarded with email marketing than it is to deluge them with television commercials. This is in part because the media are different. Television is a passive medium, the Internet is an active one. The emphasis is on ‘inbound marketing’ rather than outbound.

Authors Kalyanam and McIntyre believe that a better formula consists of 11 factors to consider.

11 Ingredients to Add a Unique Recipe Value

Product – in all of their guises mentioned above including information, music, audio, eBooks, services, and so on.

Placement- consider affiliates, other supply chain partners

Pricing – free, tiered, subscriber model, micro-payments

Promotion – online ads, sponsor links, email, public relations

Personalisation – customization, individualization, collaborative filtering

Privacy – e.g. state your policy and conformity to the relevant SPAM Act.

Customer Service – FAQ, help desks, Email, Chat rooms.

Community – chat rooms, user ratings, reviews

Website – navigation, ease of use and usefulness, user experience (UX), user interface (UI).

Security – SET, SSL

Sales Promotion – e-coupons, offers, bundling.

Do you find this helpful as an E-Marketer or is the 4 or 7Ps just as effective?

 

Sources:

Kalyanam, K & McIntyre, S. (2002) “The e-marketing mix: A contribution to the e-tailing wars”,

Journal of the Academy of Marketing Science, Vol. 30, No. 4, pp. 487-499.

McKenna, R (1991), “Marketing is Everything,” Harvard Business Review, January, 1991.