The term ‘neuromarketing’ implies that marketers benefit the most from learning applied neuromarketing. But, neuropsychological insights reach a much wider audience than only marketers. Of course, as a marketer, you want to increase conversion rates and persuade customers to buy. But, professionals in other fields can enjoy principles of neuromarketing as well. From CEOs and managers to public speakers or growth hackers. Anybody who wants to achieve behavioural changes becomes more successful using neuromarketing techniques. And that’s everybody.

Remember the subconscious mind?

In an earlier blog post, you read about the two systems that Daniel Kahneman has proposed, System 1 and System 2. The subconscious System 1 forms most of our behaviour. But, models and theories on persuasion techniques intend to influence the customer’s rational mind. You may have experienced that it is not easy to change someone’s opinion or attitude or to prove your point. Kanheman’s dual-coding theory explains that making suggestions for the rational mind hardly changes someone’s behaviour. Instead, you must focus on subconscious processes and the factors that regulate these. Not only applies this to consumer behaviour, but also to societal, political, educational, and economic matters.

Powerful persuasion

Before we act, our brain has already made many decisions. Different theories about the most effective and efficient persuasion tactics are developed. By doing we discovered which buttons to push to persuade someone. Conventional marketers know little about why those buttons work the way they do. Neuropsychology offers an understanding of the human’s brain and behaviour. And neuromarketing hands you the tools to improve your skills. Even though you already master the art of persuasion, applied neuromarketing teaches you why these techniques work.

Cognitive Biases behind persuasion

Cognitive biases are systematic ways of reasoning and decision-making. You can also refer to them as a sort of mental shortcuts. By ignoring irrelevant input from your surroundings, cognitive biases enable the brain to work efficiently. But, these cognitive biases can cause illogicalities in the decision-making process. Whether you are a CEO or marketer, it is beneficial to be aware of our brain’s cognitive biases. We have countless numbers of cognitive biases (currently over 200, and counting). Let’s take a look at a selection of biases that can improve your persuasion tactics the most.

Loss Aversion

The first cognitive bias which is worth a more profound explanation is loss aversion. Loss aversion is the tendency to avoid potential losses at all costs. We experience the pain of losing twice as strong as the pleasure of earning equal gains. That results in some illogical reasoning when making decisions. As a marketer, you can increase your sales by using our reluctance to losing. Well-known tactics are scarcity and urgency. These tactics emphasise the potential losses and thereby increase the desire to own a product. Managers and investors need to be aware of this cognitive bias as well. The reluctance to sell at a loss causes people to hold on to property, even though its value decreases. Because we avoid the risk of losing, loss aversion also results in poorer investments. Framing messages differently change how we perceive the option; appealing or repulsive. The emphasis on either the loss or the savings determines our behaviour.

Anchoring

In the human mind, concepts are not represented as absolute or permanent. We feel the urge to compare all new information immediately to what is presented to us earlier. This first piece of information, the anchor, serves as a reference point. This anchor determines how we perceive the following information. If the anchor is set high, people overestimate the value of the information presented later. If the anchor is set low, you will find opposite results. This tendency to rely heavily on the first piece of information is useful to you. For example, to reduce the pain of paying. By presenting the more expensive product earlier than similar cheaper ones, you make the following products seem a good offer. The buying behaviour of your customers will increases by doing so.

Priming

Priming might remind you of the well-known example of subliminal exposure of Coca-Cola in movies. But priming appears in many different forms and can be applied ethically. Exposure to something in your surroundings subconsciously activates related concepts. These concepts are more easily accessible. That influences the decision-making process both directly and indirectly. Listening to your friend’s experiences in Italy and looking at their photo’s of the Colosseum may result in your choice to have pizza for dinner. Or a reminder that boys are more skilled in mathematics and sports affects the performance at tests or in the field. We dedicated a deep-dive to priming. It is well-known how conceptual priming of your brand or products increases sales. But managers or policymakers can utilise positive priming to improve their employees’ motivation, productivity, and workplace engagement.

Default Bias

When we have a choice between several options, we tend to prefer the status quo. People rather stick to what they already know and have, even though they are aware that it is not the best option. Considering alternatives and dealing with change requires cognitive energy and comes with uncertainty. And we always choose to avoid this. It is even so that what is listed as default option doesn’t influence our decisions. The default bias is a popular way for managers or policymakers to nudge their target audience towards a particular decision. You can help people to make choices that benefit themselves and society by carefully choosing the default option.

Affect Heuristic

If you have ever relied on your gut-feeling when faced with complex choices, you have experienced the affect heuristic. The affect heuristic holds that how we feel determines how we think and act. We tend to choose the option which evokes an association with positive and loving emotions. If you want to guide your target audience to say ‘yes’, it helps to set a positive mood beforehand (insert priming and framing). A positive state relates to a more positive perception of potential risks and benefits as well. Overriding our emotions is a difficult thing to do, but applied neuromarketing helps you to understand the tricks to change the feelings a message evokes.

Endowment Effect

The endowment effect refers to the tendency to ascribe a higher price to products we own. Thereby, our willingness to pay for a good is lower than the price we are willing to sell the same good for. Marketers can put this bias in use by creating a sense of ownership, for example by offering giveaways and free trials, or by adding elements of personalisation. It is a powerful tool for keeping your customers loyal to your brand or services. Investor or CEOs need to be aware of this effect as well. Stockholders, for example, tend to overvalue the shares they bought once they own them. Applied neuromarketing will help you gain a deeper understanding of (almost) all cognitive biases. Ignorance or unawareness of the cognitive biases may hurt your strategies and have adverse effects on growth. However, managers, CEO’s, marketers, or anyone else who take cognitive biases into account can turn the tables and enjoy the advantages of learning applied neuromarketing. Have we persuaded you that acquiring neuromarketing skills benefits everyone, including you? We hope we did. However, all knowledge loses its value when you cannot apply all these insights successfully. Learning how to utilise these techniques in daily life will help you become a better marketer and persuader. It will ensure you to get what you want, whether you carry out an organisational change in your working environment, design the most effective growth strategies for your company, or persuade your manager to give you that promotion. Are you intrigued? Find out more about learning applied neuromarketing in our 1-Day Crash Course.

Marketers and marketing researchers have always pursued to explain, predict, and guide consumer behaviour. Consumers – including you – are constantly influenced by everything they see and experience. The understanding of how behaviour is affected by these experiences provides valuable insights into the reasons why people click, buy, and act. The comparison of marketing vs neuromarketing will convince you of the must to adopt these insights

Conventional marketing

The conventional marketing methods are primarily focused on the consumer’s self-reported opinions on the effectiveness and the likeability of the advertisement. People often think they know why they made a specific purchase or decision. Consumers are assumed to be rational decision makers, weighing every pro and con against each other to find the best outcome. But if we do so, how do we explain our worst decisions and our closets filled with useless purchases?

Indeed, trying to find the reason for those bad choices is very difficult. People appear to be weak at identifying the reasons behind their decisions: the bad ones, but the good ones as well. So, we can conclude that decision-making is not exclusively a conscious process, but mainly a subconscious process. This is why conventional research methods, like interviews and focus groups, fail individually.

Drivers of our behaviour

From our previous posts, you might have understood that all behaviour originates in the brain. Our behaviour is not only directed by logic reasoning, but it is also highly controlled by factors below our level of consciousness, such as prior knowledge or emotions. A good understanding of the consumer’s brain and its subconscious processes is necessary to create opportunities to guide their behaviour and reach the desired goals more efficiently.

Neuromarketing

Comparing marketing vs neuromarketing asks for a clearer the definition of applied neuromarketing. Where neuromarketing research analyzes our emotional and cognitive response to media and marketing stimuli and how this affects our behaviour, uses applied neuromarketing these insights to improve advertisements and marketing strategies. Well-known companies like Booking.com, IKEA, and Coca-Cola already adjusted their strategies with the latest insights and principles neuroscience has to offer. These companies have adopted neuroscientific research to reshape their marketing strategies by branding and design. Improvement of the understanding of consumer perception is an essential requirement for marketers to survive in the future.

The key to survival: information processing

Information processing is the key concept in cognitive neuroscience. Nowadays it is crucial to understand how information enters our brain and how our decisions reach the conscious mind. To create a good understanding of the consumer’s brain and behaviour, we refer to Nobel Prize-winning psychologist and behavioural economist Daniel Kahneman who distinguishes mental activity in System 1 and System 2. More information about the human brain's structure and function you can find in our article What every marketer should know about the brain.

System 1

System 1 is described as the fast, automatic, effortless, intuitive, and subconscious system. It allows us to automatically shift attention to remarkable changes in our environment, make split-second decisions, and prepare for possible dangerous situations. ‘Gut-feeling’ and intuition are terms often used to clarify these activities. It is estimated that 95% of our decisions are made by System 1. That means that nearly all our decisions and behaviours are subconsciously and quickly initiated, primarily based on underlying basic emotions.

System 2

System 2 is mostly known as the slow-processing system. It is controlled, rational, conscious, and follows a standard set of logical rules. Here is where the so-called ‘internal dialogue’ occurs, consciously evaluating multiple reasons and possible outcomes.

Marketing vs neuromarketing

System 1 and System 2 differ in the way they operate in decision-making strategies. Now you will really begin to understand the consumer’s brain! Most marketing campaigns and advertisements are designed to influence the rational mind consciously (yes, System 2). Nonetheless, rational decision making is the exception rather than the rule. As we have seen, the ‘buying brain’ is based on subconscious processes, emotions, and snap judgements. That has to do with the difference in processing speed of System 1 and 2. Where System 2 processes with a rate of 40 bits per second, System 1 has a processing speed of 11,000,000 bits per second. As a result, System 1 will almost always override System 2 when there is competition in the process of decision making.

Thus, effective changes in behaviour must be backed up with a change in the consumers’ subconsciousness, their gut-feeling, towards the subject (System 1).

If appropriately used, emotions are a powerful tool to do so. People buy based on feelings, but justify their purchases with logic and reason. That phenomenon is known as the post-purchase rationalisation bias: the tendency of consumers to persuade oneself afterwards that the purchase was a good value through rational arguments. This is one example of the many cognitive biases we use to make sense of the world rapidly.

Cognitive Biases

Our brain needs to prevent itself from analysing every detail in the constant stream of incoming information to save cognitive energy. To do this it applies a broad scale of cognitive biases, presenting themselves as a sort of mental shortcuts. These biases simplify the enormous amount of information entering the brain and enable a faster decision-making process. Due to insufficient or inferring information, like emotions, our subconscious mind is prone to systematic errors. Yet, cognitive biases provide a foundation for the predictive science of consumer choice, because they result from rationality, and will always bias our responses in the same way. There are around 200 cognitive biases and we’ll explain three below.

Post-purchase rationalisation bias

We’ve explained the post-purchase rationalisation bias. People do not want to feel uncomfortable with the decision they made, so they seek reasons to rationalise their choice. The understanding of this mental shortcut helps us realise the difficulty of changing the decision-making process by System 2. The decision itself is already made by System 1, influenced and biased by our basic emotions. This fact is used in neuromarketing strategies by confirming the choice of the customers. Leading firms already include the neuroscientific perspectives into their marketing strategies.

The bandwagon effect

Another cognitive bias worth mentioning is the bandwagon effect. This bias holds that people tend to do or believe things because many others do or think so too. People often seek social proof and feel the need to belong. The wish to join in with the favourite group creates conformity to the shared group norm. As a marketer, you can use this bias by creating an illusion of popularity, for instance by showing other people’s reviews, ratings, or purchases.

The illusory truth effect

The third bias to discuss is called the illusory truth-effect. People are more likely to believe a familiar statement than an unfamiliar one. We can explain this bias with the ease of cognitive processing: things you are repeatedly exposed to, are more easily processed, and this facilitates liking it. This leads people to believe that the more a statement is repeated, the more truthful it is considered to be. Advertisers ideally want to show you their ad as many times as possible.

We believe that our overall enthusiasm for applied neuromarketing is broadly shared. An understanding of the differences between marketing vs neuromarkeing shows that it is necessary for every marketer to master the art of applied neuromarketing now. Applied neuromarketing presents insights into the cognitive biases that influence the consumers’ behaviour. It enables you, as a marketer, to reveal emotional responses and subconscious cues that help establish marketing strategies, more effective for your intended audience. By understanding these and their effect on the behaviour of individuals and groups, you are able to anticipate reactions and guide your consumers’ behaviour in new and more effective ways. Offering the ‘why’ and the ‘how’ behind our brain and behaviour, applied neuromarketing is here to stay!

In our 1-day Crash Course, you will learn all essential neuropsychological and cognitive insights to become a skilled neuromarketer. Apply here to gain and apply all brain and behaviour knowledge!

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