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Neuromarketing: the Hope and Hype of Neuroimaging in Business

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Neuromarketing: the Hope and Hype of Neuroimaging in Business PERSPECTIVES SCIENCE AND SOCIETY information about their true preferences. Such hidden information could, in theory, be used to influence their buying behaviour, Neuromarketing: the hope and hype so that the cost of performing neuroimaging studies would be outweighed by the benefit of neuroimaging in business of improved product design and increased sales. In theory, at least, brain imaging could Dan Ariely and Gregory S. Berns illuminate not only what people like, but also what they will buy. Abstract | The application of neuroimaging methods to product marketing — Thus far, this approach to neuromarketing neuromarketing — has recently gained considerable popularity. We propose that has focused on this post-design application, there are two main reasons for this trend. First, the possibility that neuroimaging in particular on measuring the effective- ness of advertising campaigns. The general will become cheaper and faster than other marketing methods; and second, the approach has been to show participants a hope that neuroimaging will provide marketers with information that is not product advertisement, either in the form obtainable through conventional marketing methods. Although neuroimaging is of a print advertisement or commercial, and unlikely to be cheaper than other tools in the near future, there is growing evidence measure the brain’s response in the form of a that it may provide hidden information about the consumer experience. The most blood oxygenation level-dependent (BOLD) measurement, which is taken as a proxy for promising application of neuroimaging methods to marketing may come before a neural activation. product is even released — when it is just an idea being developed. The second reason why marketers are excited about brain imaging is that they hope it will provide an accurate marketing Despite many common beliefs about the As in all compromises, these approaches research method that can be implemented inherently evil nature of marketing, the main provide solutions with intermediate levels even before a product exists (FIG. 1). The objective of marketing is to help match prod- of cost, simplicity, realism and quality of assumption is that neuroimaging data ucts with people. Marketing serves the dual data (TABLE 1). would give a more accurate indication of goals of guiding the design and presentation The incorporation of neuroimaging into the underlying preferences than data from of products such that they are more compat- the decision-making sciences — for example, standard market research studies and would ible with consumer preferences and facili- neuroeconomics — has spread to the realm remain insensitive to the types of biases tating the choice process for the consumer. of marketing. As a result, there are high that are often a hallmark of subjective Marketers achieve these goals by providing hopes that neuroimaging technology could approaches to valuations. If this is indeed product designers with information about solve some of the problems that market- the case, product concepts could be tested what consumers value and want before a ers face. A prominent hope is that neuro- rapidly, and those that are not promising product is created. After a product emerges imaging will both streamline marketing eliminated early in the process. This would on the marketplace, marketers attempt to processes and save money. Another hope is allow more efficient allocation of resources maximize sales by guiding the menu of that neuroimaging will reveal information to develop only promising products. offerings, choices, pricing, advertising and about consumer preferences that is unob- Thus, the issue of whether neuroimaging promotions. tainable through conventional methods. Of can play a useful part in any aspect of market- In their attempts to provide these types course, with such high expectations, there ing depends on three fundamental questions, of inputs, marketers use a range of market is the accompanying hype. Several popular which we will address in this paper. First, can research techniques, from focus groups books and articles have been published that neuromarketing reveal hidden information and individual surveys to actual market push a neuromarketing agenda, and there that is not apparent in other approaches? tests — with many approaches in between are now a handful of companies that market Second, can neuromarketing provide a more (see Supplementary information S1 (box)). neuromarketing itself 5. In this Perspective, efficient cost–benefit trade-off than other In general, the simpler approaches (focus we aim to distinguish the legitimate hopes marketing research approaches? Third, can groups and surveys) are easy and cheap to from the marketing hype. As such, we hope neuromarketing provide early information implement but they provide data that can that this article serves the dual purpose of rec- about product design? include biases, and are therefore seen as ognizing the real potential of neuro imaging in not very accurate1–4. The approaches that business and providing a guide for potential Revealing hidden information are more complex and therefore harder to buyers and sellers of such services. Brain activity and preference measurement. implement, such as market tests, provide Allowing for the assumption in neuro- more accurate data but incur a higher cost, Why use brain imaging for marketing? marketing that the brain contains hidden and the product, production and distribu- Marketers are excited about brain imaging information about preferences, it is reason- tion systems have to be in place for market for two main reasons. First, marketers hope able to set aside, for the moment, the issue tests to be conducted. There are some that neuroimaging will provide a more effi- of ‘hidden’ and ask what relationships are compromise approaches between these two cient trade-off between costs and benefits. known to exist between brain activity and extremes, which include simulated markets, This hope is based on the assumptions that expressed (that is, not hidden) preference. conjoint analyses, markets for information people cannot fully articulate their prefer- As it turns out, different methods of and incentive-compatible pricing studies ences when asked to express them explicitly, eliciting a person’s preference often result in (see Supplementary information S1 (box)). and that consumers’ brains contain hidden different estimations of that preference3,4,6,7. 284 | APRIL 2010 | VOLUME 11 www.nature.com/reviews/neuro © 2010 Macmillan Publishers Limited. All rights reserved PERSPECTIVES Table 1 | Comparison of selected marketing research approaches Focus groups Preference Simulated choice Market tests questionnaires methods What is measured Open-ended answers, Importance weighting for Choices among products Decision to buy and body language and various product attributes choice among products behaviour; not suitable for statistical analysis Type of response process Speculative, except when The respondent must try A hypothetical choice, An actual choice, with used to assess prototypes to determine his decision so the same process as customers’ own money, weightings through the actual purchase — and therefore fully introspection, then map but without monetary consequential those weightings into the consequences response scale Typical use in new-product Early on to aid general Design phase, when Design phase, when End of process, to forecast development processes product design; at user determining customer determining customer sales and measure interface design for trade-offs is important trade-offs is important; the response to other usability studies may also be used as a elements of marketing, forecasting tool such as price Cost and competitive risk Low cost; risk comes only Moderate cost and Moderate cost (higher High cost and high risk of from misuse of data by the some risk of alerting if using prototypes alerting competitors, plus seller competitors instead of descriptions) the risk of the product and some risk of alerting being reverse engineered competitors before launch Technical skill required Moderation skills for Questionnaire design and Experiment design Running an instrumented inside the group and statistical analysis and statistical analysis market and forecasting ethnographic skills for (including choice (highly specialized) observers and analysts modelling) This makes it difficult to know which to both of these questions is positive, However, such similarities do not necessarily method provides the truest measure of neuromarketing could become useful for mean that brain activation is the same ‘decision utility’ (that is, the expected utility, measuring preferences. across different elicitation methods, and which would ultimately drive choice in the Measurements such as willingness to there are differences between the neural marketplace). It is clear that market tests give pay (WTP) have only recently come under activation representing decision utility and the most accurate answer, but having to run functional MRI (fMRI) examination. In one that representing experienced utility14,22,23. a market test on every product would defeat experiment, subjects bid on the right to eat This caveat aside, the generally close corre- the purpose of market research — namely, snacks during the experiment. The amount spondence does suggest that neural activity to provide early and cheap information. they were willing to pay (a measure of deci- might be used as a proxy for WTP Similarly, we suspect (and economists
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