How cognitive neuroscience applies in marketing

Decoding consumer behavior: Unleashing the power of cognitive neuroscience in marketing

Cognitive neuroscience enters the market with the declared aim of revolutionizing the field of marketing, offering new perspectives on the understanding of the human mind. As TSW we want to underline how much neuroscience can help us understand, at a different level, the real element of value: people.

Knowing the needs and requirements of our customers remains the most relevant element for any marketing activity. The goal of this article is to tell you about some famous applications that have made it possible to optimize strategies with truly remarkable results. We will explore some anecdotes on the influence of emotions and the brand, and how these are measurable through neuroscience.

The influence of emotions

Cognitive neuroscience has shown that emotions play a crucial role in consumer decision-making. A famous study is the one conducted by Lindstrom for a large soft drink company, with the aim of examining the effect of price on consumer behavior.

Using functional magnetic resonance imaging, Lindstrom examined participants’ brain activity as they made purchasing decisions. The study revealed that higher price labels activated the amygdala, an area of the brain involved in emotional response, generating a greater perception of value. In other words, consumers placed a higher value on products with a higher price, even if the quality or characteristics of the items were identical.

The company used these findings to review the pricing strategy of their products. They placed slightly higher price tags on mid to high-end products to create the illusion of higher value and found a significant increase in sales value.

This case study demonstrates how cognitive neuroscience can be used to better understand consumers’ reactions to price-related information and use that knowledge to optimize marketing strategies.

The importance of branding

Cognitive neuroscience has also revealed how important branding is in influencing consumers’ purchasing decisions. Studies show that familiarity and emotional affinity with a brand can activate brain regions associated with trust and preference. One famous study that demonstrated the importance of branding was conducted by Kevin Lane Keller, a professor of marketing at the Tuck School of Business.

Keller’s study, known as the “Consumer Needs Hierarchy Model,” investigated the relationship between brands and consumer preferences. Keller has developed a model that identifies five levels of consumer needs: functional, symbolic, experiential, relational, and self-expression.

According to the study, brands that cater to consumer needs to a higher degree create a stronger and more lasting bond with consumers. For example, a successful brand not only satisfies consumers’ functional needs (such as product quality or convenience), but goes further, offering a symbolic or emotional meaning that allows consumers to express their identity or to create relationships with the others.

This study shows that the activation of brain areas associated with emotions, such as the amygdala and the insula, can influence consumers’ emotional reactions towards a particular brand. For example, if a brand evokes positive emotions, amygdala activation can create an emotional connection with the brand itself, which in turn can influence consumer preference.

Conclusions

Cognitive neuroscience applied to marketing has opened new horizons for understanding and influencing consumer behavior. Companies that use this knowledge can create more effective, engaging and emotionally relevant marketing strategies.

However, it is important to underline that cognitive neuroscience in marketing is only a tool, and the human and creative approach remains fundamental. With a deeper understanding of consumers’ minds, businesses can build stronger relationships, increase customer loyalty, and gain a competitive edge in the marketplace.