Marketing & Sales technique : Neuromarketing The new science of consumer decisions by Terry Wu
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About 20 years ago a group of
researchers did a study at a wine store
they want to find out if source
background music could influence
shoppers wine selections here's what
they found on a days when they played
German music German wines also French
wines by 3 to 1
and on the bass when they play French
music French wines also German ones by 3
to 1 but here's a kicker
they asked shoppers if the background
music influenced their wine selections
your profit could guess over 90 percent
of shoppers say no this study shows that
our buying decisions can be influenced
by something so subtle that we don't
even notice the study also raises some
important questions how do we make
buying decisions you will make decisions
consciously based on facts reason and
logic we're doing make decision
unconsciously based on emotions feelings
and intuition next I'd like to share
with you harrowing conscious emotions
influence our decisions
you remember New Coke here's a story
behind New Coke in 1985 Coca Cola was
losing market share to Pepsi perhaps he
had been telling coca-cola by claiming
that in blind taste testing more people
preferred Pepsi over coke coca-cola
decided to improve the taste by changing
his formula it came up with new coke
over 200,000 people taste test New Coke
or whelmingly people preferred New Coke
over the original coke but more
importantly people prefer New Coke over
Pepsi with a lot of confidence coca-cola
rolled out new coke but very quickly
this sweet drink turned into a bitter
pill that cost coca-cola tens of
millions dollars angry customers started
protesting around country demanding the
original coke back anxious customers
start hoarding Coke products left on
store shelves
coca-cola headquarters received about
8,000 angry phone calls a day he can
help asking
how could 200,000 people get it wrong
what did coca-cola miss what coca-cola
missed was a strong emotional connection
people had for nearly hundred years coke
had been marketed as a feel-good product
their marketing slogans included have a
Coke in the smile I like to buy the
world a coke celebrities like Elvis
Marilyn Monroe and the Beatles were the
face of coca-cola if you don't feel well
have a coke Coca was more than a sweet
beverage drinking coke had to become a
feel-good experience that feel-good
experience involves thoughts feelings
and memories while drinking coke seems a
bit complicated doesn't it the study
pops in 2004 shows how Coca Cola's
marketing has imprinted our brains with
good thoughts feelings and memories in
this study volunteers for a 13 litre
coke were Pepsi while their brains were
scanned to find out which part of the
brain became active
the researchers start out with blind
taste testing like the Pepsi challenge
they were able to replicate the result
the Pepsi challenge that is slightly
over 50% of volunteers preferred Pepsi
over coke no surprise there then the
research has made a slight change to the
Pepsi challenge the volunteers were told
exactly what they're going to drink
before taking a sip it's no longer blind
taste test anymore
suddenly 75% of volunteers prefer Coke
over Pepsi more surprisingly while
they're drinking Coke the emotional part
of the brain the memory part brain and
the thinking part of the brain became
their active in sharp contrast this
elevator brain active the pattern was
not observed while they're drinking
Pepsi with the study tell us the study
demonstrates what happens in our brains
unconsciously when we think of popular
brand like a Coca Cola
the study also demonstrated that our
thoughts feelings and memories can
unconsciously change our experience with
a product this is exactly how the
unconscious might influence our choices
the fast feelings and memories evoked by
the coca-cola brand are the strong
emotional connections people have and
coca-cola missed those strong emotional
connections when they reduce this iconic
drink to just taste this is why New Coke
failed for this brain study we can see
how marketing influences our emotions
and our decisions without our awareness
this is where neuroscience means
marketing welcome to new marketing new
markings and new signs consumer
decisions he studies how men will make
buying decisions and how our emotions
and intuition shape our decisions but
why the markers are paying attention to
our emotions intuition and unconscious
mind here are some of the reasons over
the last few decades neuroscience
research has confirmed that about 95
percent our decisions are made
unconsciously during the same time
medical studies have shown that without
emotion we simply cannot make decisions
inside the human brain there are many
highly specialized areas each area has
unique functions some areas are response
we're seeing some are were hearing some
are for tasting and this larger the
brain color in blue is what we call the
limbic system is our emotional brain our
emotions depend on this part of the
brain our love compassion optimism pride
joy happiness as was anger fear anxiety
embarrassment guilt and sadness our
Center in this part of brain
neuroscientists often learn more about
the brain when something goes wrong here
we have Frank he had a stroke the stroke
damaged a large paralyze his emotional
brain what's going to happen to him what
you will see as a Frank will have a very
difficult time making decisions even the
simplest decisions when he goes to a
grocery store to buy breakfast cereal he
will agonize over the decision whether
he's to choose we these Cheerios were
conflicts without his emotional brain
being fully functional he simply cannot
make that decision
every purchase involves decision making
both neuroscience and marketing can help
us understand how make decisions and
will influence our decisions
there's mirrored between the earth
science and marking has given birth to
neuromarketing but why does new Merton
matter every year nine of the ten new
products fail about a hundred billion
dollar spend on marketing are wasted the
main reason that traditional marketing
fails to pay attention to consumers
unconscious emotional experiences this
will happen to new coke if we can avoid
wasting so much money on - marketing
both consumers and businesses went with
newer marking to focus on creating
better consumer experiences and it does
work first like to share with you how
Google captain's user's unconscious
behavior to maximize his revenues we'll
have seen Google as before the links in
these ads are colored in blue every time
you click on these blue links Google
makes money naturally Google wants a
huge surtout click on these ads more
often we know that color can impact our
emotion in our behavior the question
Google asked was whether a subtle change
of color in these bull links could
changes users clicking behavior several
years ago Google test is close to 50
shades of blue in these links wanting to
find out if certain shades of blue with
general more clogs one shade of blue did
10 or more clicks by adopting that color
Google increased annual revenue by 200
million dollars this is a power new
marketing if you know what clicks with a
brain you can apply that knowledge
create better customer experience a
better customer experience and transfer
into a stronger bottom-line this is why
new marketing works next like to share
with you how a slight a notable speedy
improvement by Amazon increase the sales
by over 1.7 billion dollars according to
Amazon a one
of a sunken speeding pumaman songs
website can you increase the cells by 1%
consciously we cannot beat at one tenth
of second difference but unconsciously
our brains notice it by speeding up the
website ever so slightly Amazon quiz a
better customer experience that better
customer experience generates more sales
this is Paul Daniel marketing Google's a
notable change of a color makes a click
more or amazons and notable speed
improvement makes a buy more what does
that tell us about our decision making
our way in total control our decisions
were the influenced by something so
subtle that we don't even notice the
study published in 1975 shows how
invisible social influence can shape our
decisions in this study volunteers were
asked to rate quality and price of
cookies from two jars one jar had cane
cookies the other one had only two
volunteers were told the cookies in the
jar with only two laughs were in high
demand in short supply now surprisingly
those cookies were read as a hiring
quality in price because it was believed
that more people wanted them what is
surprising that all the cookies used in
the study were identical we tend to
believe is something's won by more
people it must be good and valuable why
is this invisible social influence so
persuasive it's because decisions create
uncertainty we feel safer by phone
decisions made by crowd this is a
natural bias in our brains Amazon
understand this bias very well uses
biased persuade to spy imagine in any
new coffee maker
how does Amazon help you decide first
you want to see a four star rating then
over 5,000 customer reviews and or 1000
questions answered then number one
bestseller all this information is based
on other customers opinions this
information comes before you see the
price and the free shipping offer
Amazon persuaded by using this invisible
social influence most people have not
heard of a newer marking yet but if you
ever bought anything Amazon you've been
persuaded by Amazon's new marketing
techniques newer marketing is still in
its infancy but there's no sort of
misinformation one big misunderstanding
is that your mark is all about brain
scans and mind-reading in 2011 the New
York Times pops a letter claiming that
iPhone users had a romantic love for
their phones here's evidence cited by
the author a pre instructor called
insular cortex let up doing brain scans
when a small number I phone users saw
their phones no self-respecting
neuroscientist would have drawn that
conclusion because the same brain
structure also lights up we see
something disgusting
one brain structure can become very
active for many different emotional
responses what do you call a
mind-reading brain scan a brain scan
some snake oil salesmen claimed that
Newmark is all about findings brains by
button by pressing that buy button you
can persuading anybody Anytime Anywhere
to buy anything until the cows come home
why does this claim also sound like a
scam because it violates a basic
principle persuasion if seems too good
to be true it is to be true
Noura marketing is about buying
decisions but the impact has reached far
beyond them because ultimately is about
human decisions we're all decision
makers through our lifetime we'll make
millions and millions decisions some
decision can be very difficult even
life-changing over the last 10 years I
had come from many gut-wrenching
decisions should I leave a stable job to
work on my own business how do I care
for my aging parents who are six six
thousand miles away in a different
country how do I support someone who
battles depression from your marking we
have learned that our decisions are not
completely within our control there are
many invisible influences that shape our
decisions without our awareness being
mindful that vulnerability give us a
more power not less our decision can
have a lasting impact on other people's
lives from newer marketing we have
learned that something very subtle
contained our behavior dramatically what
does it take to safety enough energy to
power all the homes in Minnesota and
Iowa it's not creating a massive
government program we're switching to
all you lightbulbs we're upgrading for
energy-efficient appliances is a tiny
emoticon in a 2007 study an energy
company printed a tiny emoticon energy
bills to tell customers about their
energy consumption a happy face meant
lower energy consumption the neighbors a
sad face meant higher
consumption the neighbors given how
powerful the invisible social influence
can be is now surprising that our
decisions it's not surprising that our
neighbors in the behavior can impact
ours what is surprising that all these
these tiny emoticons reduce energy
consumption by almost three percent
that's enough energy to power all the
homes in Minnesota and Iowa who would
have thought something so subtle can be
so powerful now this subtle cue is
showing up in our lives here is any bill
NGO I recently received it has a happy
face I'd like to close my talk with one
more story this story has some bathroom
humor
it's about urinal spillage when a guy
stands for on urinal he often does his
business mindlessly and aimlessly
spill it happens they cost money to
clean it up in 1990s the amsuman airport
came up with a brilliant solution all
they did was to etch the image black
line near the training urinal when guys
see that black light they start aiming
at unconsciously that reduces spillage
by 80%
well other than my poor case of humor
was the point I like this story because
this fly serves a good metaphor when you
search what what touches people's hearts
and minds you want to find game changers
if you understand how the brain works
you guys know how people make decisions
you can find a game changer that has a
huge impact the most fascinating thing
is very often this game changer is
something we don't even pay attention to
it can be something very subtle like a
background music and wine store a slight
change of color by Google noticeable
Expedia Mumbai Amazon a tiny emoticon on
your energy bill or a fly as a target
once you find some sacado
by following your science the impact
will be anything but subtle you want to
make a positive impact you want to make
you want to help others thrive here's
something I encourage you to try find
your fly and thank you very much
everybody thank you.
Who is Terry Wu
Dr. Wu received his Master's degree in Neuroscience from Duke University and earned his Ph.D. in Neuroscience at Vanderbilt University, focusing on research into learning and memory. He then began a 20-year career in Neuroscience at the University of Minnesota. He built one of the first two local marketing firms that specialize in Search Engine Optimization, science-based website design and conversion optimization. Over the last 20 years, growing research from Neuroscience, Social Psychology and Behavioral Economics has been providing new insights on how the brain makes buying decisions. That gave birth to a new field, Neuromarketing. With his extensive knowledge and experience in both Neuroscience and marketing, Dr. Wu helps businesses grow revenues rapidly by guiding their customers to make informed decisions. Today, his company, Neuromarketing Services, based in the Twin Cities, is the only Neuromarketing firm in the Midwest. Dr. Wu received his Master's degree in Neuroscience from Duke University and earned his Ph.D. in Neuroscience at Vanderbilt University, focusing on research into learning and memory. He then began a 20-year career in Neuroscience at the University of Minnesota. He built one of the first two local marketing firms that specialize in Search Engine Optimization, science-based website design and conversion optimization. Over the last 20 years, growing research from Neuroscience, Social Psychology and Behavioral Economics has been providing new insights on how the brain makes buying decisions. That gave birth to a new field, Neuromarketing. With his extensive knowledge and experience in both Neuroscience and marketing, Dr. Wu helps businesses grow revenues rapidly by guiding their customers to make informed decisions. Today, his company, Neuromarketing Services, based in the Twin Cities, is the only Neuromarketing firm in the Midwest.
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