Neuromarketing Standards Draft

Sent along by Ron Wright of Sands Research:

Thank you for attending the Advertising Week NeuroMarketing Forum!

As promised, we are sending you the ARF's white paper summarizing the findings and recommendations from our NeuroStandards Collaboration Project. (This is a pre-production version; a bound, printed version will be available later.)

As you will see in the attached draft of the NeuroMarketing White Paper, the findings are encouraging for the future of neuromarketing as a major player in the advertising research portfolio of any major company. While there are clearly debates to be resolved and additional progress that is needed, we believe three things are certain:

• Measuring the emotional and unconscious response to advertising is imperative in order to drive effective advertising.
• Traditional advertising research methods are simply not going to give us the insights needed to address these decisive factors in consumer choice.
• Neuromarketing methods already offer excellent capabilities in understanding emotional arousal and getting around cognitive biases like "social desirability," and some provide promising capabilities in assessing sentiment (valence), desire, and memory encoding.  

To be sure, a lot of the same considerations that we face in traditional research are no less relevant for neuromarketing studies, when they are to be used as quantitative research: sample size/statistical confidence, the value of experimental design, etc. But, even if large sample sizes are simply not economically or logistically feasible, we should also not be afraid to use neuromarketing techniques qualitatively and early in the creative process. The rewards will quickly become apparent.

Now we move on to phase 2 of NeuroStandards, “How Advertising Works Today” (a.k.a., Neuro 2.0). If the ultimate goal of advertising research is to increase the productivity of advertising investments, quantitative ad research measures with predictive validity across a broad range of products and services are a must. The need for this is as great for traditional measures as it is for the newer ones. The ARF’s “Copy Research Validity Project” published in 1991 was a path-breaking first step in this direction.  But with our new insights about emotion and the emergence of new research options for understanding it, it’s time for a new, robust, comprehensive, definitive evaluation of predictive validity for traditional, neuromarketing, and other “implicit” approaches. That’s what “How Advertising Works Today” (a.k.a. Neuro 2.0) is all about. The first Forum will be on December 7, more information will soon be on the ARF website.
  
Many thanks for your interest in and support of the ARF and NeuroStandards .... 

Neuromarketing

 We touched on this years ago, as part of a broader cognitive science analysis of marketing,   it seems to have slipped behind the curtain since then.

A relook at the definition, there were a half dozen companies companies pushing it at the time. We tested some scenarios, mostly to test ad results.  It was common at the time to analyze Superbowl ads in context.

What is Neuromarketing?

It's time for an updated definition of "neuromarketing."  By Roger Dooley

Neuromarketing is the application of neuroscience and cognitive science to marketing.

Neuromarketing is the application of neuroscience and cognitive science to marketing. This can include market research that tries to discover customer needs, motivations, and preferences that traditional methods like surveys and focus groups can’t reveal. 

Neuromarketing can include the evaluation of specific advertising, marketing, packaging, content etc. to more accurately understand how customers react at the non-conscious level. And, it can include applying the knowledge obtained from neuroscience and cognitive science research to make marketing more effective without testing specific ads or other materials.

“Consumer neuroscience” is sometimes used as a synonym for neuromarketing.  ..."

Neuromarketing for Dummies

I see that Sands Research has recommended the NeuroMarketing for Dummies by Genco, Pohlmann and Steidel, now available for preorder.  A balanced treatment, they say.  For yet more balance see also Sally Satel's book Brainwashed:

" ... Yes, a "Dummies" Book on Neuromarketing but trust us, it is full of excellent information on the rapidly expanding field of consumer neuroscience. 

(If they can produce a Dummies book for Differential Equations, why not the application of brain sciences in market research?)

Genco, Pohlmann and Steidl provide a well organized, easy to read, step by step review of how neuromarketing is influencing consumer insight and its applications in advertising, shopper marketing, product design and development, etc. The authors provide a well balanced (and fair) approach with scientific background, insight on the various methodologies employed and how best to choose a vendor.  They also address potential ethical issues with neuromarketing. ... " 

On the State of Neuromarketing as Science

Via Forbes,  by Roger Dooley.  He examines the status of a long running ARF study, which he says includes both positive and negative results for neuromarketing.  I have been part of neuromarketing tests, both inside a large enterprise, and as part of a startup that sold the analysis methods.

" .... Most recently, an exciting new study from Temple University researchers took direct aim at the most popular neuromarketing technologies in an attempt to validate their effectiveness. The work was done at Temple University’s Center for Neural Decision Making at the Fox School of Business. A separate team at New York University analyzed the collected data and compared it to actual advertising results. The project was funded by the Advertising Research Foundation, which has been engaged in a multi-year effort to develop standards for neuromarketing. ... " 

Good read, but still preliminary. Links to the Temple study above are worthwhile.   Conclusion?  Neuromarketing studies appear to extend classical maketing analysis techniques.  But the reason the studies appear to work cannot yet be confirmed by the neuroscience reasons suggested.  Seems to aim towards an art vs science conclusion.  Which increases risk in their application.   Similar to what I heard from neuro scientists in 2007.

True Impact Neuromarketing

Recently connected with Diana Lucaci of True Impact Marketing in Toronto. A Canadian firm that does neuromarketing studies.   I was impressed with their list of clients and analytical perception of the problem.

See also, their blog for examples.

" ... Our company is a leading Neuromarketing firm in Canada, with two main businesses segments: Strategy and Research. Neuromarketing Strategy involves alignment with your marketing and corporate objectives, identifying the gap in customer understanding, and delivering actionable insights of customer emotional engagement.   Neuromarketing Research is conducted with a specific, target audience and studies communications that appeal to any of the 5 senses: sight, sound, smell, taste, touch. Research grade equipment and protocols are used to ensure the highest level of ethical standards. Our technologies of choice include functional Magnetic Resonance Imaging (fMRI), Electroencephalogram (EEG) and Eye-Tracking.... " 

Neuromarketing PR

Mind Hacks takes a hack at Neuromarketing.    I think there is something to be considered here.  There is value in trying new methods to augment traditional ones, but just cryptically invoking support is not enough to make you depend on them.

" ... Neuromarketing is the study of the neuroscience of marketing – a genuinely interesting field that, contrary to what neuromarketing companies will have you believe, has absolutely no practical benefit at the moment because no-one has yet demonstrated that a neural response is a better predictor of the key outcomes than a behavioural response. This, however, is more like neuro-spin-marketing, as it relies on people believing the hype of neuromarketing to get branded pseudo-studies into the media.... " 

ARF Releases Neuromarketing Review

Have been looking forward to this:

ARF Reveals Results from Neuromarketing Review

US— Neuroscience is best used alongside traditional research methods, and with the advice of experts, the ARF said today as it unveiled findings from its review of neuromarketing techniques.

At its annual Re:think convention in New York, The ARF said it is now working on a second phase of the NeuroStandards project, with a view to coming up with standards for neuromarketing services. It is also establishing an ongoing ‘forum’ on the subject, and a network of dozens of independent experts to advise users of neuroscience-based research.... "

Neuromarketing: Fantasy or the Future

In Adage: Is Neuromarketing a Fantasy or the Future?
It Could Give Marketers an Edge, but Questions Remain About Effectiveness and Ethics

Neuromarketing, and the research that supports it, potentially circumvents the battle between good marketing and bad marketing. In a maniacal advertiser's dream, instead of trying to outthink and cajole potential customers into buying a product, the possibility of neuromarketing offers a deeper, more visceral compulsion that can be used to compel consumers to buy, buy, buy. But does it work? And is it ethical? ... "

Morphological Neuromarketing

In today's New York Times, an interesting case study on a Neuromarketing method used by US snack goods manufacturer Frito-Lay, which used the morphology (structure and size) differences between women's and men's brains to change their chip packaging and marketing to appeal to women. Includes a video of their marketing. Different than the sensor biometric methods usually emphasized when discussing neuromarketing. A women's marketing expert makes the point that this is 'less insulting' than the usual approach of making a package pink. Specifics of testing unclear.

" ... Juniper Park used neuromarketing in a slightly different way. Ms. Nykoliation began by researching how women’s brains compared with men’s, so the firm could adjust the marketing accordingly. Her research suggested that the communication center in women’s brains was more developed, leading her to infer that women could process ads with more complexity and more pieces of information.

A memory and emotional center, the hippocampus, was proportionally larger in women, so Ms. Nykoliation concluded that women would look for characters they could empathize with.

And research Ms. Nykoliation read linked the anterior cingulate cortex, which processes decision-making and was larger in women, to feelings of guilt. (Experts differ on how directly functions or feelings are associated with various parts of the brain.) Ms. Nykoliation then asked NeuroFocus to review her assumptions and, as Juniper Park developed ads, to test the ads to verify that women liked them ... "

A number of aspects of this research and application makes me skeptical of it being predictive.

Neuromarketing: Exploring the Brain of the Consumer

Leon Zurawicki at UMass has a new book:

Neuromarketing: Exploring the Brain of the Consumer.  Professor Zurawicki joined us at a panel I led on neuromarketing last year in Krakow.

The book link above lets you download some portions of the book, and even read it online. I am in the process of reading,  and promises to be a good look at this area. I will follow with a more detailed review.   Their  overview:

" ... Over the last 10 years advances in the new field of neuromarketing have yielded a host of findings which defy common stereotypes about consumer behavior. Reason and emotions do not necessarily appear as opposing forces. Rather, they complement one another. Hence, it reveals that consumers utilize mental accounting processes different from those assumed in marketers' logical inferences when it comes to time, problems with rating and choosing, and in post-purchase evaluation. People are often guided by illusions not only when they perceive the outside world but also when planning their actions - and consumer behavior is no exception. Strengthening the control over their own desires and the ability to navigate the maze of data are crucial skills consumers can gain to benefit themselves, marketers and the public. Understanding the mind of the consumer is the hardest task faced by business researchers. This book presents the first analytical perspective on the brain - and biometric studies which open a new frontier in market research. ... "

Neuromarketing Beyond Copy Testing: Sensory in Retail Context

This is the kind of research we continued to look at in the innovation center.  How do shoppers actually interact non-consciously with complex environments like the retail store.  Read the whole article from the link.

From Sands Research Newsletter:

"Growth Beyond Copytesting into Shopper and Sensory Insight
Back in early 2008, when Sands Research was incorporated after several years of R&D, the majority of our work was completing neuromarketing research studies on television commercials. We also began our annual Super Bowl Neuromarketing Study on ranking the most engaging spots during the big event. (See below for info on the upcoming 2011 Super Bowl Study). Since that time, our comparative database has grown rapidly with our Neuro-Engagement Score (NES) and Emotional Polarity Timeline (EPT) measures becoming increasingly accepted by the consumer insight community.

Over this past year, we are seeing a growing utilization of neuromarketing services in shopper insight and sensory testing. With a portable EEG amplifier and Eye-tracking equipment in a small handbag or waist pack, our shopper participants have the ability to roam the aisle providing their unbiased, non-verbal feedback to focal points in their purchase decision process .... "

Use and Impact of Neuromarketing

Ron Wright  of Sands Research sends along a note on Oxford doing a study on the use and impact of neuromarketing. " ... Researchers at the University of Oxford are putting neuromarketing under the spotlight in a study of how it is changing market research and what this means for society. As interest in neuromarketing grows, Professor Steve Woolgar and Dr Tanja Schneider are to carry out a three-year project to better understand how these techniques are being applied to marketing and research, and how they will affect our understanding of how consumers make decisions.... "

Sands Neuromarketing Alliance in China

Just received, an impressive partnership and direction:

Sands Research and Brain Intelligence Establish Neuromarketing Alliance in China and Globally

Partnership to assist clients in fast growing consumer market

  El Paso, Texas and Beijing, China - Sands Research Inc. (SRI), a leading provider of neuroscientific market research services and technology headquartered in the USA, and Brain Intelligence Neuro-Consultancy Ltd. (BI), the first Chinese neuromarketing firm, announced today that they have joined together in providing their specialized services to the top brands and companies in China and on a global basis.

"We are pleased to announce this alliance with the Beijing based research agency, Brain Intelligence and offer our clients local expertise in a market of tremendous consumer growth" stated Ron Wright, President / CEO of Sands Research Inc.

"BI, which was founded by Ms. Ruihong Tang and is advised by leading academics from Beijing Normal University, will be a great partner. Our two companies will work together to provide the latest in market research technology and applications in China and Hong Kong. The neuromarketing services offered include the evaluation of communications (TV advertising, print, web), innovation (product, concepts, packaging) and the shopper experience (both in-store and virtual). Measuring Web usability for increasing conversion rates and online advertising for increasing media ROI is one of BI's real fortes." commented Wright.

"In turn, Sands Research will provide the same services to BI's client base of fast growing Chinese companies who are looking to expand their brands beyond China to the United States, Europe and other key markets."  Wright added ..... "

Neuromarketing Firms Merge

Have worked with Sands, unexpected.  More movement on understanding of non conscious marketing.  In Neuromarketing:  " ... Neuromarketing Consolidation: Sands Research and Neurons, Inc. Merge .... In a possible sign that the neuromarketing industry is maturing, two well-regarded firms in the space have announced their merger: Sands Research and Neurons, Inc. ... "

Neuromarketing Code of Ethics

An intriguing neuromarketing code of ethics.   " ...  Neuromarketing Science & Business Association (NMSBA) has launched today (9th November 2012) a Neuromarketing Code of Ethics. This is a first step towards adopting international standards applied to using neuroscientific methods to study the effectiveness of advertising campaigns, packaging and product design, as well as communication campaigns from non-profit organizations and government institutions. ... " 

Report on Brains on the Path to Purchase

In my last message I indicated my acquired skepticism on some current neuromarketing work.   Just to provide some balance, let me point a report from a recent conference.  One of my favorite correspondents spoke:

Report from the Neuro Retail Revolution 
  Several hundred researchers, clients and interested parties earlier this month gathered at the Neuromarketing Science and Business Association's Neuro Retail Revolution Conference in Amsterdam. ,,, Covering findings from both the in-store and on-line retail worlds, leaders in the growing field of neuromarketing presented their unique insight on how consumers respond to these environments.... 

"Your Brain on the Path To Purchase"
Dr. Stephen F. Sands, Chairman and Chief Science Officer at Sands Research relayed the varying degrees of neuro-engagement and emotional valence evoked by marketing stimuli across the path-to-purchase journey - from initial need activation to pre-consideration (out of store), to in-store and finally to conversion at the point-of-purchase. Utilizing results from EEG and Eye tracking data sets, including findings from the recent nationwide POPAI Shopper Behavior Study, Dr. Sands provided attendees with actionable insight of the cumulative effects of TV advertising, print and packaging on the ultimate purchase decision-making moment and how marketers and retailers can achieve the optimal mix to drive sales in-store for their brands and categories. ... 

Includes links to slide presentations.

Neuromarketing Paper

A new paper.li of interest: Neuromarketing by Daniel Ladieu.  Neuromarketing and associated interest in its hype cycle has increased sharply of late.  Includes some of my writing.

Neuromarketing Science and Business Association

Newly formed group I was informed of by Steve Sands: The Neuromarketing Science & Business Association (NMSBA) is the global trade association for all those engaged in neuromarketing. The NMSBA is headquartered in the Netherlands and its organization is managed by Carla Nagel. The board determines the agenda and to discusses urgent matters. The NMSBA has a chairperson for every country involved.

Sands Research on Neuromarketing

Sand's most recent newsletter on neuroscience methods covers a number of interesting papers and articles on the topic.  If you have not read about neuromarketing or have not followed it recently, this is the time to catch up.  As I have mentioned recently many large marketers are involved.   I especially like the note on  Shopper insight explosion, my specialty. 

" ... In this issue:
 * A White Paper on Finding the Sweet Spot between Neuroscience and Quantitative Research
 * Fast Company Article on Neuormarketing in the September Issue
 * Sands Research Ranked 19th in Top 50 of Innovative MR Firms
 * Shopper Insight Explosion
 * Ni Hao (Hello) Beijing - Neuromarketing in China    ...  "

Neuromarketing List

A new neuromarketing Twitter list being constructed #neuromarketing Online here. Looks to have some useful follows.