NEUROMARKETING:

THE IDEAL ANSWER TO BRAND COMMUNICATION IMPROVEMENT

An Essay on Neuromarketing and its Ethical Implications By Adriana Bianchi: s00502715 Tutors: Mr. Marc Opresnik, Mr. Richard Cawley INTERNATIONAL MARKETING MANAGEMENT 4/11/2011

EUROPEAN BUSINESS SCHOOL OF LONDON

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Over the past decades there has been a steady increase in the number of researches on marketing practices and consumer behaviour. Along these, incredible progresses have been made in the understanding of the human brain. Nowadays, companies are even more aware of the fact that their performance relies on how and how well their customers are reached and engaged: buyers are more cosmopolitan, the competition is stronger and sales cycles are longer (Renvois and Morin 2007). Therefore, the revolutionary concept of Neuromarketing can be seen as the ideal answer to the challenges posed to companies by the market and its customers. It may sound scary, but minds have been entered and broken (Moore 1982: 38). Neuroscience and cognitive psychology have met with business, providing new instruments and methodologies to study the human brain, codify its working processes and successfully trigger consumer preferences. The literature written on this new concept provides some definitions regarding its nature. Lee, Broderick and Chamberlain succinctly define Neuromarketing as: The application of neuroscientific methods to analyze and understand human behavior, in relation to market and marketing exchanges. (2007: 200) According to Renvois and Morin (2007) the term Neuromarketing has come to identify a new field of research, promoted by both academic and private companies, which uses neuroscience to allow deep insights into the human brain responses to marketing stimuli. The purpose of these studies is to acquire objective information about the working of the consumers brain triggered by external stimuli, and the subsequent purchasing intentions and decisions. By studying the unconscious and emotional areas of the brain, marketers can start foresee customer preferences, and further knowledge can be acquired on how customers think, feel and act within markets and organizations (Lee et al, 2007). From a classical communication point of view, marketers look at themselves as the emitter and at the consumers as the receptor (Pop, Radomir, Maniu, Zaharie, n.d. 805). However, nowadays the situation is overturned: customers are now the responsible of giving information to the companies about when, how and what commercialize. Therefore, in order to understand marketing-relevant human behaviour and to analyze the effects of advertising on the human brain, technology can be seen as useful in terms of functional magnetic resonance imaging (fMRI), electroencephalography (EGG) and galvanic skin response (GSR).

Our brain is one of the most fascinating and evolved organs known by the mankind, and every single purchasing decision is made by it. As stated by several scientific theories, the brain is divided into two hemispheres. The left hemisphere is responsible for rational and logic thinking, while the right is the centre of creativity and conceptual thoughts. According to Neuromarketing studies, our brain can be divided into three more main areas: the new brain, which thinks; the middle brain, which feels; and the old brain, which decides (Renvois and Morin 2007). These three parts constantly communicate with each other, but it is the old brain that ultimately takes decisions, hence communicating with it raises the effectiveness of advertising. Lee et al. highlighted how different types of advertising generate different types of brain activity, resulting in differences in recalling and/or other measures of effectiveness (2007: 201) Consequently, the main concept behind Neuromarketing is that purchasing decisions are not necessarily rational, rather they result from a combination of thoughts, feelings and emotions (4imprint Inc. 2010). People think they behave rationally, but most of their decisions are not based on logical processes (Trends e-magazines 2010). First, the stimuli perceived from an advert is processed for shape, color and spatial location as the signal pass through the lateral geniculate nuclei and then, the memories triggered by an advertisement are stored through the cerebral cortex and recalled through the hippocampus (Wilson, Gaines, Hill 2008: 391). In order to investigate these transformations, as well as the role of emotions in the decision-making processes and the cognitive and affective mechanisms during the purchase (Wilson, Gaines, Hill, 2008), marketers started using the functional magnetic resonance imaging (fMRI). fMRI is a neuroimaging technology tool used to identify which parts of the brain are activated from the exposure to stimuli (for example an advertisement). Through this scanner researchers can see exactly which areas of the brand respond to the stimuli proposed (Ferguson 2009) by tracking changes in blood flow and oxygen consumption: the more active an area, the more oxygen and blood flow is required (4imprint Inc. 2010, pp.3-4). Further researches also studied the predictability of a choice, whether it can be related to the prior frequency usage of the item or to the time passed between the choice and the exposure to the marketing stimuli (Braeutigam et al 2004). Therefore, memories play an important role in the brand choice, and marketers can also try to recall long-term memory, refreshing synapses already activated by the brand (Ambler, Ioannides, Rose 2000). By looking at the fMRI outcomes and at EGG readings, which reveal the negative and positive feelings and the amount of thoughts in the brain, neuroscience can be used as a

diagnostic tool and as a stimulus for developing successful branding strategies (Young: 2011). In essence, neuroscience will help advertisers to be more effective marketers (Rapp, Hill, Gaines, Wilson 2009: 57). In fact, neuroscience, can help to discern the underlying factors driving poor performance (Young, 2011: 20). Therefore, communicational objectives and advertising communication incisiveness may be fully reached, in terms of awareness, attitude and nominal appeal (Brioschi 2006), if supported by such scientific evidences. Nowadays, post-modern consumers seem to play many roles and to possess many different identities. Consequently, it has become even more difficult to reach the audience effectively, to fashion a powerful content and choose the right delivery channel. For many years now, marketers have increasingly believed in the importance of developing branding strategies that aim to actively and emotively engage customers. By creating multidimensional consumption experiences, companies allow their customers to live a real experience when they shop. Hirschman and Holbrook (1982) stated that these factors pertain to phenomena called hedonic consumption. Hedonic consumption designates those facets of consumer behavior that relate to the multisensory, fantasy and emotive aspects of ones experience with products. (1982: 92) In 1999 Schmitt then theorized the use of the Strategic Experiential Modules in order to create successful customer experiences. Modules have distinct structures and processes, and include sensory experiences (SENSE), affective experience (FEEL), creative cognitive experiences (THINK), physical experiences, behaviours and life-styles (ACT), and social-identity experiences that result from reference group or culture (RELATE) (1999: 60). Is now clear that the customer must be involved both affectively and cognitively. According to Schmitt (1999) companies try to stimulate the five senses to activate a process of customer engagement, which brings higher levels of commitment, involvement and trust and which ends in customer loyalty, intention to purchase, market share and profits (Bowden 2009). Neuromarketing is increasingly becoming part of the total business communication approach of many companies in the attempt to crate successful marketing strategies. As that the concept of Neuromarketing is becoming more and more popular, many debates on its ethical aspects are also exacerbating among practitioners. As previously mentioned, the

use of neuroscientific data and methods in the marketing field can drive companies to understand exactly what factors of an advertisement are critical to the awareness, attitudes and evaluation of products (Lee et al. 2006: 203). However, the other side it may curtail the free will paradigm historically claimed by moral philosophy (Wilson, Gaines, Hill 2008). Some theorists maintain that external constraints on decision making imposed by applications of neural manipulation are possible violations, and transgressions are particularly troublesome when manipulation occurs without explicit awareness, consent, and understanding (Wilson, Gaines, Hill 2008: 401). Furthermore, privacy issues might be intensified (Rapp, Hill, Gaines, Wilson, 2009). In fact, according to Wilson et al., the Brain is the storehouse of the human personality, and scanning may provide an indirect glimpse into that persona (Wilson, Gaines, Hill, Rapp 2008: 57), which means that the privacy may be in danger. The American Federal Trade Commission issued guidelines that should provide adequate privacy protection under the section called Fair Information Practice Principles, in terms of notice/awareness, choice/consent, access/participation, integrity/security, and enforcement/redress

(www.ftc.gov/reports/privacy3/fairinfo.shtm). Due to the fact that these guidelines are not so well recognized and universally adopted, Murphy et al. (2008) strongly promote the adoption of an ethical code by the neuromarketing industry. Recommendations are given in the sense of protection of research subjects, protection of vulnerable niche populations from marketing exploitation, full disclosure of goals, risks, and benefits, accurate media and marketing representation and validity (2009: 298-299). Within the frame of neuromarketing is clear that the perception of knowledge is changing rapidly (Butler 2008), and so is extremely important that marketing strategies and public policies evolve together. Boundaries to the application of neuroscience should be determined and information property should be acknowledged. The critical role of marketers is now to monitor the outcomes and to actively participate to the ethical debate (Wilson, Gaines, Hill 2008), in order to not show lack of transparency or care. Therefore, the quantitative methods used to evaluate the effectiveness of advertising campaigns before spending money on them must be used ethically. In fact technology by itself cannot be the answer: it enables business processes but it doesnt change the customer and his desires.

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