Think with me for a moment here. When was the last time you bought something? For most people, the answer is probably last weekend while they were buying groceries or maybe last night during a wine-fueled online shopping spree.
Outside of routine and impulsive decision making, we typically think of our purchases as something brought about by rational thinking. We say to ourselves, “This is the best deal possible!” or “It might cost more upfront but it’s going to be cheaper in the long run.”
For a long time, that’s what economists believed as well. That is, until marketers, company executives, and psychologists banded together to make you buy more of their products. Turns out, you don’t need to convince a customer’s rational brain at all.
In fact, rational thought processes could be bypassed altogether with covert marketing tactics that exploit the decision-making shortcuts and informational processing gaps that your brain has.
It’s called neuromarketing and it’s part of why you keep reaching for your credit card.
What Is Neuromarketing?
Before we head into it, just remember you aren’t stupid. It’s not your brain’s fault that it works the way it does.
In the early days of the study of economics, the reigning theory was that consumers always made rational decisions about what they buy and why they buy it. Always. Rational choice theory is a principle of consumer decision making popularized by Adam Smith, the same guy who wrote The Wealth of Nations.
As the name suggests, rational choice theory states that people make rational calculations of how a product or service could benefit them before making a purchase. For example, you wouldn’t expect someone with a good pair of shoes to buy another out of the blue unless the first one breaks or the second one is a massive upgrade. But if you know a sneakerhead or anyone who collects objects, you’ll also know that’s pretty much B.S.
While rational thoughts do make up a significant portion of why we buy things, there’s also that other part of our brain that makes emotional decisions or decisions based on evolutionary instinct.
Someone who buys canned food regularly, even if they don’t use up their stock, might be collecting because of an instinct to gather resources and provide themselves with a sense of emotional security. For collectors of practically useless items like, say, Funko Pops or Gundam models, the drive to collect could be FOMO or hang ups from a childhood of poverty when they never had enough money to buy what they wanted.
Armchair psychoanalysis aside, there’s a huge connection between what we feel about an item and what we buy.
Coca-Cola would learn this lesson the hard way when it tried to beat Pepsi by creating a newer, better Coke. Coke and Pepsi were battling for dominance over the soda market in the 1970s and early 1980s. Coca-Cola initially had the market in a stranglehold until Pepsi launched its “Pepsi Challenge” campaign.
The campaign didn’t have delightfully fresh twists like the other ideas Pepsi had. No Kylie Jenner solving racism here nor was there a Pepsi lottery contest that killed five people. This was one of Pepsi’s simpler and less deadly marketing stunts.
The company had soda drinkers participate in a blind taste test that stripped Pepsi and Coke of their branding, leaving the two sodas to fight solely on their quality. The result? Pepsi won. When Coca-Cola executives started to replicate the study, perhaps in an attempt to discredit the challenge, they found that it was true: people actually liked Pepsi more.
Coke needed to act and fast.
Before the blind taste tests, the Coca-Cola recipe had remained relatively unchanged aside from several tweaks that involved switching from cane sugar to beet sugar and, finally, to high fructose corn syrup. But in 1982, the company introduced New Coke, a soda fit for the 1980s that could keep up with the changing tastes of consumers.
It was tastier than old Coke and, more importantly, it was tastier than Pepsi. This sweeter mix of acids and syrup was soon rolled out to convenience stores, fast food restaurants, and vending machines worldwide.
Considering the drug-like ways sugary foods and drinks fill your brain with dopamine, you wouldn’t be wrong to expect that New Coke would be a hit. Except it wasn’t.
New Coke flopped hard. In an attempt to make New Coke the consumer base’s new favorite drink, the marketing team and research and development team over at Coca-Cola forgot that people were heavily attached to the brand.
New Coke may be scientifically tastier, but Coke Classic had years of branding behind it. Soon, customers in Seattle were dumping New Coke into sewers which is obviously not the most environmentally friendly way to deal with a soda brand changing recipes. More business savvy consumers started Prohibition-style rackets of hoarding Coke Classic and reselling them at higher prices.
So, why did New Coke fail? The answer may lie in neuromarketing. When the company swapped old Coke for New Coke, Coca-Cola made an assumption based on rational choice theory. New Coke tastes better, therefore, our customers will like it more than Pepsi and Coke Classic.
Neuromarketing describes how marketers and advertisers exploit our brains into making purchase decisions based on cognitive and behavioral science. This can range from measuring the pupil dilation of a group of participants when presented with certain brands or sticking them under an MRI scanner to see what parts of their brains light up as a response to products. Some neuromarketing research techniques involve tracking eye movement to see what parts of an ad you look at first so brands know where their copywriters should slap their best hooks.
Neuromarketing techniques can also involve using emotional connection and social psychology to keep consumers buying.
For example, while brand name products are often better quality, there’s often another option that’s roughly the same quality but a little cheaper. Rational choice theory would say that the cheaper off-brand would be the better choice. But you’ll likely go for Adidas anyway because the cheaper brand isn’t as cool or prestigious.
After years of being advertised as an equivalent to happiness and being as sexy as kissing Elvis Presley, Coke Classic had trained its consumers to think of it in association with enjoyment and desirability. Even its bright red color is geared toward stimulating excitement. New Coke didn’t stand a chance.
Neither does your brain. Since the 1980s, neuromarketing has only gotten more popular. It’s now such a widespread practice that these covert advertising tactics are virtually impossible to escape and one of them may even be in your pocket right now.
Your Brain on Capitalism
1. The Hedonic Treadmill
If you know the myth of Sisyphus, you’re either a mythology fan, someone who actually listened to their philosophy 101 class, or a nerd. Kidding aside, the hedonic treadmill is essentially that: rolling a boulder endlessly up a hill and then running back down to push it up again. Except that this time, your brain is the hill and serotonin is your boulder.
The hedonic treadmill was first discussed by Brickman and Campbell, the psychologists who authored Hedonic Relativism and Planning the Good Society, a 1971 essay on hedonic adaptation. Put simply, the hedonic treadmill is a metaphor for how we chase after emotional highs and, once we’ve become used to it, start to chase after more. There’s never enough and there’s always some new consumerist Skinner box around the corner.
Think about how there’s always a new flagship phone every year. You’re cool now while you have the latest one and it feels like you’re on the cutting edge of technology. Next year, even if that phone still works perfectly, you won’t feel as good about it as you do now. But that’s not a big problem. A new flagship phone is out and to maintain the high of having the best phone on the market, you just have to pull out your credit card again.
Maybe you’re a more sensible person who likes to make practical purchases or you have ethical contentions with wanton consumption. It doesn’t matter because planned obsolescence will make sure you eventually buy a phone without a headphone jack.
2. The Right Placement
Are you sure you pay attention to what you watch on TV? Just because cable TV is on its way out and subscription-based viewing is in doesn’t mean you’re free from ads. More eagle-eyed viewers will notice brand name products in their favorite shows. Try to zero in on the background of a scene next time and look for a can of Coke or a pair of Beats headphones hanging on a character’s neck.
This neuromarketing technique is called product placement and it helps brands keep you aware of the fact that they exist and maybe, just maybe, you’re in the mood for a can of cold Coke.
Product placement is arguably the most powerful when used in supermarkets and convenience stores. Next time you drive down to your local Costco, think about what parts of a shelf your eyes often land on and how many of your most purchased products are from the part of the shelf that’s at eye level.
It’s such an effective marketing tool that there are slotting fees in place for brands to choose where their products are placed. It’s a bit similar to real estate: location matters. Brands will sometimes collaborate with retailers to have their products placed on ideal shelf locations to ensure that they maximize profits.
Aside from eye level, marketers will place products in areas of a store depending on what that product is. Small splurge items like chocolate and makeup will often be placed near cashier tills while fresh products like flowers, fruits, and meat are placed closer to the entrance to make the customer associate the store with freshness.
3. A Touch of Color
There’s a less popular, smaller branch of psychology that tells us about how color affects our perception, emotional states, and decision making. Color psychology is the study of how color impacts your feelings and behaviors.
Our brain associates certain colors with complex meanings. The cool color of blue evokes water, rain, and low emotional arousal whether that be calmness or sorrow. Just think about how we say “feeling blue,” “green with envy,” and “red in the face.” Color is even associated with morality as shown by the phrase “morally grey”.
Of the colors most commonly found in nature, bright shades of red are the most eye-catching. It’s associated with arousal in general, whether it’s because of danger, excitement, or love. It’s also associated with blood and when it comes to meat, that bright red color of blood is always an indicator of freshness. It’s no wonder that we use color as a way to determine whether food is safe to eat and has good nutritional value.
A study on the effects of food color on the tendency to eat found that the color red actually increased food consumption while blue, a color that’s less likely to occur in nature, often caused a decrease in appetite. Incidentally, red is also a popular color in logos for fast food chains. Make of it what you will.
4. Behavioral Conditioning
With the advent of the mobile phone, gaming has finally entered the mainstream. What used to be a niche hobby available only to people who could afford an Amiga now fits in the pockets of your average consumer.
But a lot of avid gamers hate mobile games. It isn’t just the gatekeeping around how playing a mobile game doesn’t make you a “real gamer,” it’s also because of the stamina systems that many mobile games, especially ones made in Asia, employ.
Stamina systems limit your playtime to keep you coming back for more. They act as a cap on how many minutes you can play per day to ensure that you return the next day, giving them another chance to wear you down until you finally give in and refresh your stamina with real money or buy an in-game resource bundle that lets you progress your account. Modern live service video games, especially gacha games, are experts at training your brain into submission and addiction.
Is Neuromarketing Ethical?
The covert nature of marketing makes it something of an ethical dilemma. To some, it’s a dishonest tactic that tricks customers into making decisions that are against their best interest, a bit like uninformed consent.
For neuromarketing expert Roger Dooley, however, neuromarketing isn’t just a manipulation of the real needs and wants of consumers. It’s a way of understanding what people really need and want so that marketers don’t waste company time and resources on ineffective campaigns.
But that’s coming from a marketer. As an average consumer, what are your thoughts on neuromarketing? Feel free to share them in the comment section below!