It’s quite possible that we live in the golden age of something called “neuromarketing.” That’s why it’s sad that only big companies and the initiated few are taking advantage of it. But we’re about to change that.
A brief story. As an economist, I was always taught that people are rational. They approach each decision in a very methodical, rational way. And, if I’m honest, we all like to think we’re rational. That we have excellent, logical reasons for the decisions we make.
But real-world observations tell a different story. People don’t behave rationally all the time. Not me, not you, not Dr. House. Yep. Our subconscious mind plays an outsized role in our decision-making processes.
As it turns out, my master’s thesis focused on one of these subconscious quirks called “odd pricing.” People will buy much more of a product priced at $1.99 than they will at $2.00. Way more than a natural demand curve would predict. In fact, that price change can lead to sales increases as high as 30% for low-priced items!
This isn’t rational behavior. Yet, it is measurable and predictable.
Studying this phenomenon led me deep into a world known as Behavioral Economics.
Dan Ariely, Behavioral Economist at Duke University, brought to the mainstream. His book Predictably Irrational challenged us to rethink how we make economic decisions.
This book and my later research led me down the rabbit hole of neuromarketing.
I’ll be honest. Behavioral Economics and “neuromarketing” will change how you think about marketing. In particular, it’ll turn what you think you know about how people make decisions on its head.
Neuromarketing will be your new, exciting, secret advantage!
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With that in mind, let’s dive right in!
What is Neuromarketing?
It sounds complex, this… neuromarketing. What is it, exactly? People who practiced neuromarketing early on used tools to measure brain activity. This included tools like EEG and fMRI.
Some people have broadened the scope to eye tracking and facial coding. And more have included heart rate and galvanic skin response.
These definitions are far from perfect. And the tools are far from practical for the average marketer.
That’s why some of the tools used in neuromarketing studies today are behavioral. This data does not directly measure brain or neural activity.
But, at the end of the day, I’m a direct marketer. Yes, I’m an entrepreneur. I’m a philosopher. And a Parrothead. And yes, I’m an economist. But at my core, all those things form into one thing: a direct marketer.
And as direct marketers, we want to understand (and predict) the behavior of our customers.
So what is neuromarketing? It’s understanding how our brains work and make decisions. And then using that information to improve our marketing decisions. That’s neuromarketing.
We need to understand our potential customer’s non-conscious thinking. We can do this by looking at fMRI images. Or we can study lab experiments. And we should analyze real-world data. Or we can use a combination of methods.
It doesn’t make sense to limit ourselves to one single approach. Not when we have so many options at our disposal.
Neuromarketing, when done this way, is your killer advantage. You see, direct marketing done the right way is very scientific and data-centric. But that’s not how most people do it. Even today, in a world flooded with data, most marketers are flying by the seat of their pants.
Just today, I had a call with a potential client. He indicated to me that he needed robust reporting and tracking. He was into numbers and data.
Ok, cool. That’s what I do better than anyone on earth.
“What do you mean by robust reporting and tracking?” I asked with anticipation. I love it when people want to understand their data and their customers better.
The reply shocked me back to reality.
“I need to know the total number of opt-ins and sales by the affiliate.”
That’s not robust. It’s the very least you need to know. That’s a capstone metric at best. It’s not going to tell you what’s driving behavior.
It won’t give you any real marketing information, much less neuromarketing information.
This potential client was winging it. But these are the people we help. And we’ll be able to get him to a place where he understands his buyer’s behavior better than anyone in his space.
That’s because we’ll set up tests and collect data. Through these tests, we’ll see how his customers actually behave. And this will give us a better sense of how to optimize his marketing framework. That’s neuromarketing.
Feelings, Not Facts, Shape Consumer Behavior. That’s the Backbone of Neuromarketing.
There’s an old saying that consumers buy with emotion and justify with logic.
Feelings, not facts, shape consumer decisions. And that’s the foundation of neuromarketing. Neuromarketing allows marketers to manipulate these feelings and emotions in subtle ways.
(Whether that’s ethical or not is a debate for another day.)
What are the most effective neuromarketing techniques? The ones that are so subtle that you never realized they are being used.
To give you a better sense of what neuromarketing is and how to use it, it’s best to start, well, in the brain.
Inside of our noggin is a big, wrinkly mass of grey matter that we call a brain. But, when it comes to processing information, there are three distinct areas.
Let’s get some terminology out of the way. I’ll use the terms that Patrick Renovise and Christophe Morin use. In their book Neuromarketing, they talk about the three brains: new, middle, and old.
The new brain is a rational processor. It’s the part of the brain where our logic, language, and conscious thoughts live. It is able to evaluate the features and price of a product.
The middle brain is where you store your feeling, hormones, and moods. This part of your brain processes your emotions during the decision-making process.
The old brain has a critical role in your decision-making process. It considers inputs from the new brain and middle brain. But it’s the ultimate decider. And that decision is almost exclusively based on fear. The function of the old brain is to keep us safe.
Now, from a marketing standpoint, we’re not talking about life or death here. We’re talking about the ‘what if this won’t work for me and I waste my time and money?’ type of fear.
Neuromarketing, then, seeks to influence the old brain.
Now, the old brain has developed a set of programs it uses to help it make decisions. We can take advantage of these programs. We can use them to nudge our customers toward the buying decision.
The nerds call these programs cognitive biases.
These cognitive biases kick in based on six basic triggers.
Self-Centered. It responds to anything that has to do with itself. It has no empathy for anything other than its own survival.
If it saw someone hurt, it wouldn’t care. It wouldn’t feel bad. It would be happy that it wasn’t the one that is suffering. But, the old brain gets jealous if someone else has something it doesn’t.
Contrast. The old brain likes black-and-white decisions. Safe/Risky. Before/After. Fast/Slow. The larger the contrast, the quicker it can make risk-free decisions.
It also reacts to changes in the environment. A light suddenly turns on or off? Boom. Something is up. A new person walks into the room; better make a note of that potential threat.
Tangible Inputs. When we use complex words and terminology, the old brain shuts down and punts to the new brain. That means that you’re using your new brain to process this blog post. To trigger the old brain, we need tangible inputs. It wants a concrete concept. It wants tangible benefits. You’ll lose weight with this product? No. You’ll lose 10 pounds in 10 days? Yes!
The Beginning and End. The old brain is about survival. It’ll pay attention to the beginning to see if you’re a threat. And it will remember the end so that it can prepare for the next potential threat. Be clear at the beginning, capture attention, and create anticipation. Repeat all the important stuff once again at the end.
Visual. The old brain relies on visual cues. It makes decisions based on the visual input faster than the new brain can recognize it. Think about seeing a stick that looks like a snake out of the corner of your eye. Your fight or flight has usually kicked in before you even realize it was only a stick.
Emotion. Emotions impact the way we process, react to, and commit information to memory. Emotions drive you to take action. You seek happiness. You want to avoid pain and sadness. You’re motivated by shock and anger.
So, if someone asks you what neuromarketing is… it’s any marketing tactic that data has shown influences one of those six triggers.
Need some Examples?
Let’s say you want to increase the conversion rate on your website.
You’ve done all the standard things. You’ve got a clear value proposition. The design is clean and easy to navigate. The copy is persuasive. The offer is great. But people are still bouncing.
So, you decide to run a test.
On one version of the page, you include a photo of a person making a purchase. On the other version, you don’t.
The version with the photo of the person making a purchase converts at a higher rate. Why? Because it’s triggering the old brain’s self-centeredness trigger. The prospect sees someone like them making a purchase and thinks, “I’m missing out.” Yes, FOMO hits the self-centered part of the old brain.
Want another example?
You’re selling a $497 online course. You have a long sales page with all the details of what’s included, plus testimonials, bonuses, and social proof. But the conversion rate is low.
Again, you decide to run a test.
On one version of the page, you include a buy now button after each section. On the other version, you don’t.
The version with the buy now buttons converts at a higher rate. Why? Because it’s triggering the old brain’s need for contrast. It wants a black-and-white decision. Yes or no. Buy now or keep scrolling.
Okay, okay, you got me. I’ll give you one more killer example.
You’re a B2B company selling enterprise software. Your product is expensive and complex. You have a long, detailed website with all the features and specs of the product. But people just aren’t getting it.
Once more, you decide to run a test. (Are you sensing a theme?)
On one version of the site, you include a video of the software in action. On the other version, you don’t.
The version with the video converts at a higher rate. Why? Because it’s triggering the old brain’s need for concrete input. A video is much more concrete than a list of features. It helps the prospect understand what the software will do for them.
Neuromarketing. What is it? As you can see, when used intelligently, neuromarketing is your exciting, secret advantage. Use it wisely.
Last Updated on September 28, 2022 by Benjamin Teal
