On the first episode of our three part neuromarketing series on B2B Growth, we start off by helping you understand what neuromarketing is and why you should care.
I'm joined by Dr. Michael Platt, Professor of Neuroscience Psychology and Marketing at the University of Pennsylvania. Dr. Platt's work has been featured in the New York Times, Washington Post, Wall Street Journal, Newsweek, National Geographic, and other different television stations and shows.
About Dr. Platt and What Got Him Into Neuromarketing
Dr. Platt's undergraduate degree was in anthropology because he was interested in human nature. His PhD was in anthropology as well, and on that path, he ended up moving into psychology... so basically what makes us tick differently from others, or what makes us tick in ways that sometimes make animals tick. For him, anthropology brought a lense to analyze human beings through from the perspective of culture and biology.
Ultimately, he wanted to have a basic understanding of how we make decisions and how that plays into economic value. Neuromarketing came into play later by applying some of this knowledge and using it to generate a higher ROI and create better advertisements.
He spent 15 years at Duke where he started the Center for Neuroeconomic Studies, which was one of the first few in the world. His final position at Duke was the Director of the Institute for Brain Sciences.
This put him on his path to where he is today at Wharton. Neuroscience connects to other areas such as business, arts, humanity, language sciences, etc. Being able to build these bridges institutionally at Penn created the Wharton Neuroscience Initiative. This community helps people of a variety of professions on campus partner with neuromarketing experts.
Some of his students have gone off to work for Google, Facebook, Nielson, and other renowned companies for their neuroscience expertise.
Why is Neuromarketing Important?
According to Dr. Platt, neuromarketing is important because it can provide a foundation for choosing one way of doing something versus another. Neuromarketing uses data to understand an impact on customers. What people's brain tells them dictates how they interact with organizations, brands, and companies.
Neuromarketing Study Example
People humanize brands and develop relationships with them. Dr. Platt took this one step further and wanted to see if people's brains reacted the same way as they do with loved ones as they do with loved brands.
They got dedicated Apple or Samsung users and brought them to the lab and scanned their brains when reading news headlines about their brand or the other one. For instance, "Apple profits soared!" or "A Samsung Battery Blew up on a Plane!" They were looking for responses in the brain within reward-related areas when their respective brand was successful, and visa versa when the headlines were negative.
Samsung users experienced reverse empathy when there was good or bad news about Apple. But only Apple customers expressed empathy for their own brand. Strangely enough, Samsung users didn't have any positive or negative response when good or bad news was released on their brand. The only evidence the Samsung users showed was their reverse empathy for Apple news. Meaning if the Apple headline was negative, their brain reflected a positive response.
The social brain network of Apple users were very lit up when they saw something. The takeaways from this has to do with what Apple has been doing over the years to build a sense of community. Samsung, on the other hand, has not built a strong sense of community. This is a great example of why neuromarketing is so important, as it can prove customer loyalty and community associated with a brand.
Applying Neuromarketing Data to B2B
While neuromarketing is a young discipline, it's gained more traction in the last three or four years and has become more refined. There was a lot of research and development that led into actionable marketing insights.
For instance, if you take a group into a lab to gather data on them, and develop a behavioral algorithm to predict the response of millions of people, you can predict things such as future sales, viewership, etc. This is an example of what can be applied to B2B.
Product Category Study
One creative study that Dr. Platt worked on with an MBA student analyzed people's brains as they looked at different brands of a particular product category. For instance, Ford, BMW, or different car brands within the car category. They found that when you ask someone to write their favorite car brands down, it generally correlates with market share. The same goes for different brands of beer and other product categories.
They also found that brands that were associated and overlapped with the word "car" would be more aligned with what a customer thought of that brand. Therefore, this predicts market share and lends itself towards brand extension. For example, the car brands that look more like a computer in your brain are going to be the ones that show a greater fit for that idea.
BMW was one of the brands that was associated with computer in the study, while Ford and Chryster were brands that weren't. Would you buy a Ford computer over BMW computer? The BMW computer has a more positively perceived association.
This sparked an idea where they could use this same approach for mergers and acquisitions. Instead they used a proxy based on personality metrics and how real people felt about different companies that were involved in acquiring another company/. They again found that companies with better personality association performed better in terms of revenue and sales following an acquisition or merger.
If you could use this neuroscience approach, you could use correlations of existing research for future opportunities. Based on this, you can predict something like a merger paying off in the long-run.
What Happens to The Power of Choice?
One thing that neuromarketing brings into question is how it plays into ethics and choice.
However, at the end of the day, even after maximizing everything, there's still statistical deviations that will never remove people's agency of choice. While building empathy and loyalty are important, if a product or service is bad, people will still always choose to avoid it.
Tactile Marketing verus Digital Marketing?
While there hasn't been much work done on this, MRIs and FMRIs are moreso equipped for putting a screen in front of someone. EEG and heartbeat measuring devices, on the other hand, can be measured through wearable devices in a physical retail environment where movement is more free.
These are the devices that would ideally be used in future studies involving digital and tactile marketing.
The one study that has looked at this, to Dr. Platt's knowledge, was conducted by Angelica Dimoka and her group at Temple Fox Business School for the US Postal Service. They found the physical advertisements activates more sensory channels, stimulating more of the brain and higher engagement.
Leveraging tactile marketing strategies also have to do a lot with messaging and timing within a sales cycle. For instance, a bottle of wine with a handwritten note out of nowhere wouldn't be near as effective as the same gift following multiple interactions with the organization.
We Are Just Scratching the Surface
Because it is such a new field of relevance, neuromarketing could be the missing component that takes AI to a whole new level. Behavioral algorithms that predict buyer behavior can even go as far as predicting future success of a business.
Neuromarketing is a truly amazing field, and that's why this is just the first installment of this three part series.
I can't thank Dr. Platt enough for joining me in this conversation and hopefully you gained some actionable neuromarketing ideas to test at your organization!
You can learn more at the Wharton Neuroscience Initiative's homepage.