Brainfluence

100 Ways to Persuade and Convince Consumers with Neuromarketing

Roger Dooley

• Publisher: Wiley
• Year: 2011
• Print ISBN: 9781118113363
• eBook ISBN: 9781118175941
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

Practical techniques for applying neuroscience and behavior research to attract new customers

Brainfluence explains how to practically apply neuroscience and behavior research to better market to consumers by understanding their decision patterns. This application, called neuromarketing, studies the way the brain responds to various cognitive and sensory marketing stimuli. Analysts use this to measure a consumer's preference, what a customer reacts to, and why consumers make certain decisions. With quick and easy takeaways offered in 60 short chapters, this book contains key strategies for targeting consumers through in-person sales, online and print ads, and other marketing mediums.

This scientific approach to marketing has helped many well-known brands and companies determine how to best market their products to different demographics and consumer groups. Brainfluence offers short, easy-to-digest ideas that can be accessed in any order.

• Discover ways for brands and products to form emotional bonds with customers
• Includes ideas for small businesses and non-profits
• Roger Dooley is the creator and publisher of Neuromarketing, the most popular blog on using brain and behavior research in marketing, advertising, and sales

Brainfluence delivers the latest insights and research, giving you an edge in your marketing, advertising, and sales efforts.

Chapter 1

Sell to 95 Percent of Your Customer’s Brain

Ninety-five percent of our thoughts, emotions, and learning occur without our conscious awareness, according to Harvard marketing professor and author Gerald Zaltman.1 And he’s not the only expert who thinks this way; the 95 percent rule is used by many neuroscientists to estimate subconscious brain activity. (NeuroFocus founder and chief executive officer [CEO], A. K. Pradeep, estimates it at 99.999 percent in his book, The Buying Brain.2) It’s doubtful we’ll ever be able to arrive at a precise number, but all neuroscientists agree there’s a lot going on under the surface in our brains. (There’s debate, too, over the terminology; many scientists prefer nonconscious or preconscious for greater precision. I’ll mostly use subconscious, simply because it’s the most familiar term.)

One indication of the power of our subconscious comes from a study that showed that subjects given a puzzle to solve actually solved it as much as eight seconds before they were consciously aware of having solved it. (The researchers determined this by monitoring brain activity with an electroencephalograph (EEG) and identifying the pattern that correlated with reaching a solution.3) Other research shows a lag in decision making—our brains seem to reach a decision before we are consciously aware of it.

The realization that the vast majority of our behaviors are determined subconsciously is a basic premise of most of the strategies in this book, and indeed, of the entire field of neuromarketing. Customers generally can’t understand or accurately explain why they make choices in the marketplace, and efforts to tease out that information by asking them questions are mostly doomed to failure. Furthermore, marketing efforts based mostly on customer statements and self-reports of their experiences, preferences, and intentions are equally doomed.

Brainfluence Takeaway: Stop Selling to 5 Percent of Your Customer’s Brain

The rest of the takeaways in this book are a lot more specific and actionable, but this one is the most important. Despite knowing that rational, conscious cognitive processes are a small influence in human decision making, we often focus most of our message on that narrow slice of our customer’s thinking. We provide statistics, feature lists, cost/benefit analyses, and so on, while ignoring the vast emotional and nonverbal subconscious share of brain activity.

Although there are conscious and rational parts in most decisions, marketers need to focus first on appealing to the buyer’s emotions and unconscious needs. It’s not always bad to include factual details, as they will help the customer’s logical brain justify the decision—just don’t expect them to make the sale!

Notes

1. Gerald Zaltman, How Customers Think (Boston: Harvard Business School Press, 2003).

2. A. K. Pradeep, The Buying Brain: Secrets for Selling to the Subconscious Mind (Hoboken, NJ: John Wiley & Sons, 2010), 4.

3. “Incognito: Evidence Mounts That Brains Decide Before Their Owners Know About It,” Economist 390, no. 8627 (April 18, 2009): 86–87, http://www.economist.com/node/13489722?story_id=13489722.

SECTION ONE

Price and Product Brainfluence

Every marketer wrestles with decisions about how to structure a product line and how to set prices. A small difference in pricing can make a big difference in profits, but the wrong price can kill sales, too. Fortunately, neuromarketing has plenty to tell us about these closely related areas!

Chapter 2

The “Ouch!” of Paying

One of the key insights neuroeconomics and neuromarketing research have provided us is that buying something can cause the pain center in our brain to light up. Researchers at Carnegie Mellon and Stanford universities presented subjects with cash, put them in a functional magnetic resonance imaging (fMRI) machine to record their brain activity, and then offered them items, each with a price. Some of the products were overpriced, and others were a good value. The subjects were able to choose to buy items with their money or keep the cash. The researchers compared self-reporting of purchase intentions by the subjects, brain scan data, and actual purchases.1

I spoke with Carnegie Mellon University professor George Loewenstein after that work was published, and he noted that one significant aspect of the findings is that the brain scans predicted buying behavior almost as well as the self-reported intentions of the subjects. In other words, absent any knowledge of what the subject intended to do, viewing the brain scan was just about as accurate as asking the subject what he or she would do.

Loewenstein pointed out that, in this experiment, the questions about the intentions of the subject were quite straightforward and one would expect the answers to be good predictors of actual behavior.

The “negative” activation produced by cost is relative, according to Loewenstein. That is, it isn’t just the dollar amount; it’s the context of the transaction. Thus, people can spend hundreds of dollars on accessories when buying a car with little pain, but a vending machine that takes 75 cents and produces nothing is very aggravating.

Bundling Minimizes Pain

Auto luxury bundles minimize negative activation because their price tag covers multiple items. The consumer can’t relate a specific price to each component in the bundle (leather seats, sunroof, etc.) and hence can’t easily evaluate the fairness of the deal or whether the utility of the accessory is worth the price.

Fairness Counts

Cost isn’t the only variable that causes “pain.” It’s really the perceived fairness or unfairness of the deal that creates the reaction. Other parts of an offer that caused it to appear unfair would presumably cause a similar reaction as a price that was too high.

There’s not always a single “fair” price for an item. For most people, a fair price for a cup of coffee at Starbucks would likely be higher than a cup from a street corner coffee cart. A famous study by economist Richard Thaler showed that thirsty beachgoers would pay nearly twice as much for a beer from a resort hotel than for the same brew from a small, rundown grocery store.2

Credit as Painkiller

Overall, Loewenstein wasn’t enthused about using his work for neuromarketing purposes. He pointed out that, for many years, credit card companies have prospered while encouraging consumers to spend too much by exploiting the principles he’s now uncovering in his research.

The problem is that, for many consumers, the credit card takes the pain (quite literally, from the standpoint of the customer’s brain) out of purchasing. Pulling cash out of one’s wallet causes one to evaluate the purchase more carefully.

We think this makes a lot of sense and is entirely consistent with real-world behavior. A credit card reduces the pain level by transferring the cost to a future period where it can be paid in small increments. Hence, not only does a credit card enable a consumer to buy something without actually having the cash, but it also tips the scale as one’s brain weighs the pain versus the benefit of the purchase. This can be a bad combination for individuals lacking financial discipline.

Brainfluence Takeaway: Minimum Pain, Maximum Sales

Pricing and the product itself need to be optimized to minimize the pain of paying. First, the price must be seen as fair. If your product is more expensive than others, take the time to explain why it is a premium product.

If you find yourself in a situation where, for cost or other reasons, the price of a product is likely to produce an “ouch!” reaction from your customers, see if some kind of a bundle with complementary items will dull the pain.

Payment terms and credit options can also reduce the pain of paying. Don’t push your customers into buying products they can’t afford, but even affluent customers will feel less pain if they don’t have to make immediate payment in cash.

Notes

1. Brian Knutson et al., “Neural Predictors of Purchases,” Neuron 53, no.1 (January 4, 2007): 147–156, http://www.neuron.org/content/article/abstract?uid=PIIS0896627306009044.

2. Richard Thaler, “Transaction Utility Theory,” Advances in Consumer Research 10 (1983): 229–232.

Chapter 3

Don’t Sell Like a Sushi Chef

I love sushi. But I hate the way most sushi restaurants sell it, with a separate price for each tiny piece. Every bite I take seems to have a price tag on it. “Mmm . . . not bad. But was that mouthful worth five bucks? Do I really want another one?”

It turns out my brain is normal, at least in relation to my aversion to the typical sushi pricing scheme. In the last chapter, we met Carnegie Mellon University economics and psychology professor George Loewenstein. Another insight from his work is that selling products in a way that the consumer sees the price increase with every bit of consumption causes the most pain. This isn’t physical pain, of course, but rather activation of the same brain areas associated with physical pain. In an interview with SmartMoney, Loewenstein noted3:

[Consumers are] not weighing the current gratification vs. future gratifications. They experience an immediate pang of pain [when they think of how much they have to pay for something] . . .

It also explains why AOL switched from pay-per-hour Internet service to pay-per-month. When they did that, they got a flood of subscribers . . . Why do people love to prepay for things or pay a flat rate for things? Again, it mutes the pang of pain. The worst-case alternative is when you pay for sushi and you’re paying per piece. Or watching the taxi meter; you know how much every inch of the way ...

Table of contents

• Cover
• Contents
• Title
• Copyright
• Dedication
• Preface: Why Brainfluence?
• Acknowledgments
• About the Author
• Chapter 1: Sell to 95 Percent of Your Customer’s Brain
• Section One: Price and Product Brainfluence
• Section Two: Sensory Brainfluence
• Section Three: Brainfluence Branding
• Section Four: Brainfluence in Print
• Section Five: Picture Brainfluence
• Section Six: Loyalty and Trust Brainfluence
• Section Seven: Brainfluence in Person
• Section Eight: Brainfluence for a Cause
• Section Nine: Brainfluence Copywriting
• Section Ten: Consumer Brainfluence
• Section Eleven: Gender Brainfluence
• Section Twelve: Shopper Brainfluence
• Section Thirteen: Video, TV, and Film Brainfluence
• Section Fourteen: Brainfluence on the Web
• Afterword: What’s Next?
• Index