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27 May 2017

Neuroscience in Marketing

Tag(s): Marketing, Technology
The Museum of Brands, Packaging and Advertising has launched a programme of professional development and last week I attended its first seminar entitled ‘Neuroscience – Why People Buy’. This was delivered by Nikki Westoby, director of Neuroscience at Nielsen CNS. The room was packed out, mainly with younger marketers at the other end of their careers, but there were a few of us older dogs still trying to learn a few new tricks.

Nielsen is, of course, well-known for measuring things: sales, markets, market shares and audiences. Now it is in the business of measuring people’s responses. Neuroscience has been with us for a long time but its use in marketing is still relatively new.

Nikki warmed us up but involving all in a response test. We were shown in quick succession images of objects in different colours and we were just asked to identify the colour. ‘Simples’ you might think and yes it was when the object was a jar and the colour was red. But after a while the images became words and then the words were the names of colours. But now the word ‘green’ was shown in red and so our brains became confused. One part of the brain was still trying to play the game but another switched automatically into reading out the word and so most of us said ‘green’ rather than ‘red’. In just a few seconds we went from a unanimous group of over 100 people shouting out the correct answers to a few rather unsure people mainly getting it wrong.

The test is reputed to have been developed during the Cold War by the US security agencies keen to entrap Russian spies. Someone whose first language was Russian would read out the Russian word for ‘green’ while a native born American would not recognise the word and still say ‘red’.

Not all processing of information is conscious. Much, maybe the majority, is sub-conscious. The brain accounts for about 4% of one’s body mass but consumes over 25% of the energy used by the body. There are billions of nodes transmitting electrical impulses and so it tries to save energy by processing in a more automatic, less considered way. Neuroscience has known about such implicit processing for over 200 years.

So a conscious response is what the consumer can and will tell you while a non-conscious response is what the consumer can’t or won’t tell you. Nielsen would argue that the latter is more important as it is likely to dictate decisions such as purchasing.

To demonstrate this Nikki showed us what happens to people who have lost one half of their ability to process though injury or disease- a condition called hemispatial neglect. We were shown two pictures of identical houses – identical except that in the lower picture fire was coming out of a window on the left. People who can only see the right half of a picture, a scene, or a room said the houses were the same. But when asked which house they would prefer to live in they all chose the upper one. When asked which was the more dangerous house they all said the lower one. So they could not tell you there was a fire but their sub-conscious had registered the fact.

Nikki tricked us again. How many animals did Moses take on the Ark? While people were trying to compute this seemingly impossible question she reminded us that it was Noah who built the Ark, not Moses.

This has been explained by Nobel Prize winner Daniel Kahneman in his best-selling Thinking, Fast and Slow[i]. In this he describes the two systems that drive the way we think. System 1 is fast, intuitive, automatic and emotional; it is used for simple tasks like watching TV or driving home. System 2 is slower, more deliberative and more logical; it is used for taking tests or completing questionnaires. Kahneman reveals the extraordinary capabilities, but also the defects and biases, of fast thinking, and shows the pervasive influence of intuitive impressions on our thoughts and behaviours. The impact of loss aversion and overconfidence on corporate strategies, the difficulties of predicting what will make us happy in the future, the challenges of properly framing risks at work and at home, the profound effect of cognitive biases on everything from playing the stock market to planning the next vacation – each of these can be understood only by knowing how the two systems work together to shape our judgments and decisions.

Some of this ground was covered earlier by Dan Ariely in his book Predictably Irrational: The Hidden Forces that Shape Our Decisions.[ii] He explains “My goal, by the end of this book, is to help you fundamentally rethink what makes you and the people around you tick. I hope to lead you there by presenting a wide range of scientific experiments, findings, and anecdotes that are in many cases quite amusing. Once you see how systematic certain mistakes are – we repeat them again and again - I think you will begin to learn how to avoid some of them”.

Daniel Kahneman was also involved in the study of heuristics, or in the jargon, the rule of thumb. These are another way the brain tries to reduce the cognitive overload. Heuristics are strategies derived from previous experiences with similar problems. These strategies rely on using readily accessible, though loosely applicable, information to control problem solving. The most fundamental heuristic is trial and error. In general heuristics are simple efficient rules learned or hard-coded by evolutionary processes. They work well under most circumstances but in certain cases lead to systematic errors or cognitive biases.

So we can see that good decision making requires the effective use of both systems of thinking. Cognition takes place in the frontal lobe, and, by the way, this only stabilises when a person reached about 21 years of age. So the ancients were right to set 21 as the coming of age and today’s politicians were and are wrong to want to give the vote to firstly eighteen year olds and more recently sixteen year olds. Emotions are felt at the base of the brain.

 Nielsen claims that neuroscience can help marketers by measuring the sub-conscious reaction to brand and product signals. It can then help build brands though emotion. It can provide granular diagnostics. This will ensure efficient and timely decision making.  Specifically the following can all be measured: electrical energy, facial coding, biometrics, eye-tracking and self-report.

We were shown a case study of a TV advertisement. It was too complicated to go into here but through neuroscience we can gauge how consumers are engaging with your ad. We can see if your ad is working hard for your brand and see if it is communicating the right message. In practical terms it is mostly used to improve an ad. Nielsen would understandably prefer to be involved at the animatic stage rather than when the client has already spent half a million on the execution. At that stage cognitive bias will have set in and the client and/or the agency will resist the message that their ad isn’t working!

But I’m not completely convinced. Basically this comes down to the question of rational vs emotional. But in building a brand I think you must appeal to both sides of the brain. Here’s what I wrote on the subject in my book ‘The 20 Ps of Marketing’.[iii]

“Advertising works on two levels as with all human understanding - the rational and the emotional; the left and the right brain. Perhaps people who say it does not work on them are rational People; they are more left-brain and able to resist the emotional appeal of a particular advert. However, great advertising usually does both. One campaign that has always stuck in my mind was run by Abbott, Mead, Vickers for Sainsbury. It simply said, “Good food costs less at Sainsbury.” However, this simple statement has both emotional and rational elements. “Good food” is an emotional idea. It is difficult to prove in the rational sense but we all know what it means. “Costs less” is entirely rational and is capable of explicit demonstration. The really clever part was that they ran the campaign in two halves. “Good food” was demonstrated in magazine advertising with beautiful food, lovingly photographed in colour and rapturously described with some of David Abbott’s best copy.[iv]Costs less” was more prosaically explained in black and white in the daily newspapers with details of this week’s special offers. But the strapline "Good food costs less at Sainsbury" was the sign off on both.

 This question of emotional and rational aspects to advertising is also a question of timing, as one may need to precede the other. An example from my own experience (or lack of, in this case) was Bounty, the chocolate-enrobed coconut bar from Mars. Readers will no doubt recall the long running campaign, “Bounty, a taste of Paradise” where the Product was associated with images of South Sea Islands and dusky maidens. When I was in Chile considering which Products from the Mars range should be launched there I thought of Bounty. Back in London over lunch with a leading executive from Ted Bates, the agency involved, I explained my theory.

“The Chileans love the South Seas. Tahiti is one of the places they aspire to visit; I’m sure they’d love Bounty!”

My lunch companion asked dryly, "Do they know what it is? Long before we showed tropical beaches we spent ten years telling them about the coconut and the chocolate enrobing.”

 The point was that the rational explanation came first and the emotional values were added later. The rational gives you reasons to buy. The emotional makes you feel good that you bought. As Scott Bedbury, the branding expert and former top marketing guru at Nike & Starbucks, says "It's not enough to have a great Product or service anymore. The world is full of Products and services that work. You have to take stock of how your brand makes consumers feel." “

In the recent past this debate has been about whether Marketing is an Art or a Science. Byron Sharp put the cat among the proverbial with his book How Brands Grow: What Marketers Don’t Know.[v] Based on the seminal marketing research by Ehrenberg and Goodhart, it argues that building brands should be based on what works in scientific practice rather than what should work in marketing theory. It seeks to get rid of costly marketing myths concerned with segmentation, differentiation and how consumers perceive brands.

It has no time for concepts like brand loyalty, brand personality or brand positioning. Instead it says the brand manager should focus on making the brand easy to buy and maximise its physical presence through availability and mental presence through memorable designs and tag lines. It claims that successful growth brands have universal appeal and at this point my blood pressure starts to rise. There are many successful growth brands that do not have universal appeal; think of Marlboro, Guinness and Johnny Walker Black.

Marketing is both an Art and a Science. The outstanding marketer can do both. The good one should know where to harness both skills, either inside or outside his management team. Customer loyalty is not a myth but loyalty schemes may be misplaced. I recall when BA demoted me from a Gold to a Silver card owing to just one flight missed. I wrote to them pointing out I also had Gold Cards with Virgin Atlantic and BMI so my loyalty to them would now increase. Brand loyalty exists and it cuts both ways: the brand owner should remain loyal to his customers.

In another example I used to shop at Tesco and had a Club Card, a much worshipped marketing tool, I hear. I received some coupons including some money off the brand of dog food they must have noticed I had stopped buying. Their algorithms presumably calculated that it was six weeks since I had bought any Chum, so I must have started buying it elsewhere. What their algorithms did not tell them was that our dog Blackie had died at the age of 16 and we had buried him in the garden. I never went back to Tesco.

P.S. To finish on a sad note, The Museum was one of the many institutions that Sir Paul Judge chaired in his remarkable career. He died on Sunday 21st May of complications with septicaemia. I was proud to have known him for many years and will write an In Memoriam Blog in due course.

[i] Thinking, Fast and Slow Daniel Kahneman. Farrar, Strauss and Giroux 2011   
[ii] Predictably Irrational: The Hidden Forces that Shape Our Decisions. Dan Ariely. HarperCollins 2008      
[ii]  The 20 Ps of Marketing David Pearson. Kogan Page 2013   
[ii] I was a client of Abbot, Mead, Vickers at the time and have the happy memory of David Abbott explaining to me the thinking behind this campaign.
[ii] How Brands Grow: What Marketors Don’t Know. Byron Sharp. Oxford University Press 2011   Bottom of Form

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