Download Neuromarketing: how to understand consumer*s mind

Neuromarketing:
how to understand consumer’s mind
Customer satisfaction
• Customer satisfaction and business success
• “The key to customer retention is customer satisfaction”
(Kotler)
Consumer‘s mind
“Marketing and environmental stimuli enter the consumer’s
consciousness or subconsciousness. A set of psychological
processes combine with certain consumer characteristics to
result in decision processes and purchase decisions.
The marketer’s task is to understand what happens in the
customer’s consciousness between the arrival of the
marketing stimuli and the ultimate purchase decision.”
Kotler and Keller (2006)
• The main objective of marketing is to help match products
with people. Marketing serves the dual goals of (1) guiding
the design and presentation of products such that they are
more compatible with consumer preferences and (2)
facilitating the choice process for the consumer.
Neuromarketing
“By studying activity in the brain, neuromarketing combines
the techniques of neuroscience and clinical psychology to
obtain insights into how we respond to products, brands,
and advertisement.
From this, marketers hope to understand the subtle nuances
that distinguish a dud pitch from a successful campaign.”
- Mucha (2005)
• There are two main reasons for this trend. First, the
possibility that neuroimaging will become cheaper and faster
than other marketing methods; and second, the hope that
neuroimaging will provide marketers with information that is
not obtainable through conventional marketing methods.
• There is growing evidence that it may provide hidden
information about the consumer experience.
Neuromarketing - linking science and marketing
• Overconsumption and compulsive shopping can be traced
back to a dysfunction of the orbitofrontal cortex (ORF)
Leake (2006)
• Impulsive buying decisions are based on the emotional
state of the buyer (governed by the limbic system), rational
buying decisions are processed in the frontal cortex.
Mucha (2005)
• Memory retention is processed in the amygdale and
ventro-medial lobes (VFML)
Ambler, Ionnides and Rose (2000)
• Irrational buying is associated with the autonomic nervous
system
Peterson (2005)
What are the potential impacts
of neuromarketing?
Neuromarketingits potential impact on product development
• flavour
• smell
• colour
• health/fashion trends
• identifiying new target groups
Neuromarketingits potential impact on product packaging/design
• logo
• colour scheme
• packaging materials
• packaging size
• limited editions
• smell
Neuromarketingits potential impact on advertisement designs
Poster/billboards
Radio promotion
size
sports person
music
balance
information/entertainment
slogan/message
Colour arrangement
TV advertisement
balance information
voice
colour arrangement
length
product focus
length
image
13
voice/music
Neuromarketingits potential impact on promotion campaigns
Posters/billboards
Sponsoring
-location
-duration
-celebrities
-events
Web adverts
TV/ radio adverts
-duration
-contents
-channels/stations
-time slots
Freebies/promotion extras
-location
-product choice
Neuromarketingits potential impact on distribution
• shelving
• product grouping
• special offers
• smell
• music
• general atmosphere
• availability
Pepsi Challenge
• The Pepsi Challenge has been an ongoing marketing
promotion run by PepsiCo since 1975.
• The challenge takes the form of a taste test. At malls,
shopping centers and other public locations, a Pepsi
representative sets up a table with two blank cups: one
containing Pepsi and one with Coca-Cola.
• Shoppers are encouraged to taste both colas, and then
select which drink they prefer. Then the representative
reveals the two bottles so the taster can see whether they
preferred Coke or Pepsi.
• The results of the test leaned toward a consensus that Pepsi
was preferred by more Americans.
Competition between taste and brand power
Most people liked the taste of Pepsi, yet the majority bought coke.
This is the brand power.
Human Neuroimaging lab, Baylor College of Medicine
New York Times 10/26/03
Neural correlates of culturally familiar brands of car m
anufacturers (Schaefer et al., NeuroImage, 2006)
• The aim of this study was to examine the neural correlates of
culturally based brands. We confronted subjects with logos of car
manufactures during an fMRI session and instructed them to
imagine and use a car of these companies.
• As a control condition, we used graphically comparable logos of car
manufacturers that were unfamiliar to the culture of the subjects
participating in this study. If they did not know the logo of the brand,
they were told to imagine and use a generic car.
• Results showed activation of a single region in the ‘medial
prefrontal cortex’ related to the logos of the culturally familiar
brands.
Results showed activation of a single region in the medial prefrontal cortex
related to the logos of the culturally familiar brands. We discuss the results as
self-relevant processing induced by the imagined use of cars of familiar brands
and suggest that the prefrontal cortex plays a crucial role for processing
culturally based brands.
•
Michael Schaefer, Harald Berens, Hans-Jochen Heinze and Michael Rotte,
Neural correlates of culturally familiar brands of car manufacturers,
NeuroImage 31(2):861-865 (2006)
Thinking on luxury or pragmatic brand
products (Schaefer and Rotte, Brain Res, 2007)
• They aimed to examine whether socioeconomic information
conveyed by certain classes of brands (prestigious versus pragmatic
classes) differentially evoke brain response.
• We presented icons of brands while recording subject's brain activity
during a functional magnetic resonance imaging (fMRI) session.
After the experiment, we asked subjects to assess the brands
according to different characteristics.
•
Michael Schaefer and Michael, Rotte, Thinking on luxury or pragmatic brand
products: Brain responses to different categories of culturally based brands, Brain
Research, 1165(24):98-104 (2007)
Sports car is a social reinforcer!
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Using event-related fMRI, they investigated the rewarding properties of cultural
objects (cars) signaling wealth and social dominance.
It has been shown recently that reward mechanisms are involved in the
regulation of social relations like dominance and social rank.
Based on evolutionary considerations they hypothesized that sports cars in
contrast to other categories of cars, (e.g. limousines and small cars), are strong
social reinforcers and would modulate the dopaminergic reward circuitry.
Erk, Susanne; Spitzer, Manfred; Wunderlich, Arthur P.; Galley, Lars; Walter,
Henrik, Cultural objects modulate reward circuitry, NeuroReport, 13(18):
2499-2503 (2002)
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On the basis of the hypothesis that brands may function as reward stimuli, we
investigated brain responses to favorite brands.
Results revealed activity in the striatum for favorite brands that positively
correlated with sports and luxury characteristics, but negatively with
attributions to a brand of rational choice. Reduced activation of a single region
in the dorsolateral prefrontal cortex was demonstrated when viewing the most
beloved brand, possibly suggesting reduced strategic reasoning on the basis of
affect.
Michael Schaefer and Michael Rotte, Favorite brands as cultural objects
modulate reward circuit, NeuroReport 18(2):141-145 (2007)
Important issues in this lecture
1. What is the neuromarketing? What are the reasons for
the neuromarketing trends? What are the benefits and
advantages of the neuromarketing approach over
conventional market research methods?
2. What are the potential impacts
of neuromarketing? Name examples of success or failure
cases in real.
3. What are the Pepsi challenge and its fMRI experiment
version? What are the implications of the results in the
challenge?