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The brains behind neuromarketing: Part 2

What if you could mine consumers’ minds to create the most effective ads possible?

Adidas is over TV ads.

Earlier this year, CEO Kasper Rorsted said he wanted to pull all Adidas TV commercials to focus on digital ads instead.

“It’s clear that the younger consumer engages with us predominantly over the mobile device. Digital engagement is key for us — you don’t see any TV advertising anymore,” Business Insider quoted Rorsted as telling CNBC.

Adidas is part of a trend. Spending on mobile and online ads surpassed TV advertising budgets in the U.S. for the first time ever last year, a milestone Canada reached back in 2014.

The latest brain science may not back up those business decisions, however.

A six-month research study by Toronto startup Brainsights found TV commercials generate 11 per cent more attention and 43 per cent more connection with viewers than video ads on mobile device screens. (Brainsights defines “attention” as simply watching and listening to the content, whereas “connection” means actually thinking about that content.)

Brainsights’ research suggests human brains instinctively associate TVs with relaxation, allowing our minds to gear down and pay fuller attention to TV screen content. Since our brains associate mobile devices with multi-tasking (like texting and emailing) or short bursts of information (like weather and news headlines), many people’s minds don’t engage as fully with video ads they view on smartphones or tablets.

Neuromarketing trend

As we explained in Part 1 of this series, Brainsights measures how people’s brains and bodies react to digital content like ads, websites, apps and videos. It collects the data through EEG (electroencephalography) headsets and other wearable sensors, then runs them through analytics software. Businesses use the resulting insights to craft digital content that resonates with their target audience.

There’s so much of this digitally enhanced neuroscience going on that in 2012, the Neuromarketing Science and Business Association (NMSBA) was founded.

“Neuromarketing studies which emotions are relevant in human decision-making and uses this knowledge to improve marketing’s effectiveness,” the NMSBA states on its website. “The knowledge is applied in product design, enhancing promotions and advertising, pricing, store design and improving the consumer experience as a whole.”

Just five years after its launch, the NMSBA has 1,684 members (including neuroscientists, academics and businesses) in 93 countries. In the last 18 months, the number of businesses listed in the NMSBA’s company directory has jumped by more than 20 per cent.

Mining minds

Although Toronto-based Alterspark Corp. doesn’t belong to the NMSBA, it is in the business of mining consumer minds. The company’s director and senior scientist, Brian Cugelman, has been studying technology and the brain for two decades. With a master’s degree in business and computer studies, a PhD in online social marketing and a BA in philosophy, he’s a triple threat with a unique understanding of computers, commerce and human cognition.

Before launching AlterSpark, Cugelman helped craft policies and campaigns on web-based influence and behavioural change for public sector agencies like the Pentagon and the United Nations. Now AlterSpark’s corporate clients include Microsoft, Samsung, Bell Canada and Salesforce.

“You can’t read a person’s mind. But you can make good estimates of their intentions,” Cugelman tells me. “There’s been a lot of progress. A lot of tracking tools like heat maps and mouse-clicking tools give you a good idea of what’s going on in a user’s mind. So there’s always a desire by more advanced marketers to get extra impact.”

While Cugelman still teaches a course in health and digital media at Toronto’s York University, he also offers a series of paid workshops in Toronto, Chicago, Vancouver, Ottawa, New York and Palo Alto.

Emotional design

One sunny day this past fall, we sat in on part of Cugelman’s two-day Toronto workshops called, “Emotional Design Psychology and Neuroscience.” AlterSpark’s website describes it as a course in “how to build emotionally intelligent websites, apps, content and campaigns based on the psychology and neuroscience of user emotion, motivation, cognition and behavior.”

Inside the small, packed classroom, Cugelman imparts lessons that are based on science — yet always business oriented.

One section explores oxytocin, a hormone and neurotransmitter that affects maternal bonding, empathy, trust and sexual attraction. Cugelman explains how online content can be designed to boost oxytocin levels and trigger positive emotions in audiences.

He gives various examples: websites and ads featuring photos of real people and situations perform better than ones with fake stock images. As well, companies that directly address consumers online with words like “our” and “we” humanize their brand for consumers. He underpins many of his examples by citing scientific research studies.

    RELATED: Learn more about neuromarketing in Part 1 of this series    

Then there’s the science of online guilt. Cugelman points out that when users try to deactivate their accounts with certain companies, the brands often deploy the same emotional tactics that people use to stop their romantic partners from breaking up with them. For example, Facebook warns departing users that “Friend X” will miss them before they exit the social network. “Then you get a barrage of guilty emails afterward. So they keep it up,” Cugelman says of the social network’s guilt-inducing retention strategy.

Somehow, Cugelman found time in between workshops to develop a new personality-based marketing tool he hopes to soon release. As yet unnamed, the program predicts a user’s personality type based on their Twitter activity. The idea is for brands to use that data to target marketing to consumers based on their personality.

Cost

There is a cost to all of this, of course. At Brainsights, the fee to analyze a campaign or product starts at $5,000. To analyze a two-minute video on one type of screen, fees start at $10,000. Analysis of a two-minute video across three screens (TV, mobile and laptop) starts at $25,000.

“It’s not just big corporations that work with us,” says Brainsights CEO Kevin Keane. He says the company “works with some smaller businesses too,” which don’t have big corporate budgets “but are still very interested in insights.”

Upcoming AlterSpark workshops in Ottawa range from $349 for one course to $1,149 for a one-week, five-session package. Discounted rates are offered, however, for non-profits, academics, governments, students and groups of three or more. The company doesn’t disclose pricing for corporate clients on its website.

Asked about the potential return his students and clients can get on their AlterSpark investment, Cugelman simply notes that even “a one or two per cent improvement on an ecommerce page can equal a lot of money.”

Results

Does this stuff really work? Some experts like British neuroscientist Matt Wall remain skeptical.

“There is currently very little data about whether EEG-derived measures actually have any effect in the real world (e.g. predict anything at all about buying decisions),” Wall wrote in a 2013 opinion piece for Slate. (Those brackets are Wall’s, by the way, not ours.)

Still, neuroscience and technology have evolved since 2013, and Cugelman and Keane both provide examples of client ROI. Keane says a consumer packaged goods company asked Brainsights to evaluate a marketing campaign it planned to launch for “a new product in a new (market) segment they’d never targeted before.”

“The company developed five pieces of video content meant to attract this segment,” Keane continues. “We tested those five pieces of content and we could identify the moments that needed to change in order to really cement that intent and linkage between the brand and that product. Our work helped them drive 13 per cent greater trial of that product than what they were projecting.”

AlterSpark’s Cugelman points to a small real estate brokerage in Costa Rica that had never done any audience research whatsoever. After Cugelman helped define its segment and create targeted campaigns, the company bested much bigger competitors to become the third best performing brokerage in all of Latin America.

Cugelman shares another story, one that doesn’t come with hard numbers on sales or revenue growth. In this case, digital psychology saved a brand from a looming disaster it didn’t even realize it had created.

“One company was launching a real estate app and they passed all the (web evaluation) tests. But they bombed so badly on the trust part — and they were just about to launch it,” says Cugelman.

“They completely did a revision,” he explains, “and they were extremely grateful.”

 

Up Next: Get your brand’s message to a whole new audience with the help of a micro-influencer. 

Does your marketing plan need a micro-influencer?

Christine Wong

Christine Wong is a journalist based in Toronto who has covered a wide range of startups and technology issues. A former staff writer with ITBusiness.ca, she has also worked as a reporter for the Canadian Economic Press and in broadcast roles at SliceTV and the CBC.

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