Neuromarketing: Inside the mind of the consumer
Managers today are under tremendous pressure to uncover factors driving customers’ attitudes and behavior. Unfortunately, traditional methods suffer from well-known limitations, and have remained largely unchanged since their introduction decades ago. As a result, there is growing interest in brain-based approaches that may enable managers to directly probe customers’ underlying thoughts, feelings, and intentions. This article aims to provide practical guidance to managers on using these tools, focusing on two distinct uses: validation of existing insights and generation of novel insights. Throughout, we stress that managers should see traditional and brain-based approaches as complements, rather than substitutes, in understanding customers.
New paper on Dissociable contributions of imagination and willpower to the malleability of human patience
Dissociable contributions of imagination and willpower to the malleability of human patience
The ability to exercise patience is important for human functioning. Although it is widely known that patience can be promoted by using willpower to override impatient impulses, patience is also malleable—in particular, susceptible to framing effects—in ways that are difficult to explain on a willpower account alone. So far, the mechanisms underlying framing effects on patience have been elusive. Here we investigated a role for imagination, dissociable from willpower, in these effects. Behaviorally, a classic framing manipulation increased self-reported and independently-coded imagination during intertemporal choice (Experiment 1). Neurally, reframing increased the extent to which patience was associated with activation in brain regions associated with imagination, relative to those associated with willpower, and increased functional connectivity of brain regions associated with imagination, but not willpower, to regions associated with valuation (Experiment 2). Results suggest that reframing can increase the role of imagination in decision-making without increasing willpower exertion.
Paul is also starting as a PhD student in the Cognitive Neuroscience group in Psychology. Paul received his B.A. from Princeton where he worked in the lab of Jonathan Cohen. Uniquely among psychology students, Paul is putting together his own lab rotation, where he will be working with Sonia Bishop and Rich Ivry.
First, a neuroscientist in a marketing department will likely find him/herself to be the first and only one there. More importantly, interdisciplinary fields inevitably result in mixing of researchers coming from very different backgrounds, especially when we consider across business-related disciplines, for example between marketing, management, finance.
To address this, we created a Neuroscience in Business google group to connect neuroscience researchers in business-related fields, and to provide a resource for those interested in the area. To add please go to the webpage to sign up. Below is a brief description.
Welcome to Neuroscience in Business (NiB)! This is a group for connecting academics in business schools who are using neuroscience methods, created by Ming Hsu, Uma Karmarkar, Vinod Ventrakamen, and Carolyn Yoon. The use of neuroscientific theories and tools in business research is growing rapidly, but is still quite novel for many business schools. In addition, people in these areas may come from very different disciplinary backgrounds. We aim to build stronger bonds in this community and increase the potential for collaboration, sharing resources, and improving training, by connecting researchers in various business-related fields who are incorporating theories and data from the biological sciences. Please join us if you are either (i) a researcher in a business-related field using (or looking to use) neuroscience theories and data in your research, or (ii) a researcher in the biological sciences working on business-related topics of interest.
Project Summary: The current proposal aims to study neural mechanisms of social learning in healthy adults as a precursor to understanding the impact of mental illnesses on social functioning. Changes in social behavior are often the first symptoms of a striking array of neuropsychiatric disorders. However, whereas disruptions in memory, motor, or emotional functioning are readily recognized as symptoms of more serious underlying conditions, decision-making deficits are often overlooked, particularly in the social domain. Furthermore, there exist few behavioral measures or biomarkers to quantify such deficits, due in part to our limited knowledge of the underlying neural mechanisms and their relation to mental disorders.
We do so via a tight integration of computational modeling of goal-directed social behavior, and testing the predictions generated using complementary experimental techniques with both fMRI and focal lesion patients. In particular, we focus on the role of dopamine and interactions between the basal ganglia and frontal cortices, which are together critical for goal-directed behavior and known to be affected in a variety of disorders. First, we will use the model, calibrated on observed behavior, to derive trial-by-trial regressors for use in functional neuroimaging experiments. Second, the estimated parameters of the model themselves can be used to compare across health and diseased groups, or find subtypes of the diseased groups. Finally, the neural correlates and the behavioral estimates can be combined in order to find novel brain-behavior markers of diseases. In this way, we seek to provide a unifying account of goal-directed behavior in both social and non-social settings, which has the potential to lead to development of new ways of classifying mental disorders based on dimensions of observable behavior and neurobiological measures.
This is just one anecdote, but the underlying idea—that food is like a drug, and obesity like addiction—is become quite well accepted. The analogy does have a few problems, delineated very nicely in a recent Nature Reviews Neuroscience opinion piece. My main takeaway is that it’s no so much as the analogy that fails, but rather the facile comparison of symptoms. For example, the tolerance and withdrawal symptoms in drug abuse have no direct equivalent in food. Still, the cognitive mechanisms, such as impulsivity and self control, likely underlie both.
Unfortunately for me, I was pretty weak from fighting all those earlier urges and had no defense against the most dastardly diet killing villain ever. Girl Scouts and their cookies! “Sir,” this cute, very innocent, albeit completely evil little girl asked, “would you like to buy some girl scout cookies? They are for a good cause.”
I just stared blankly at her for what must have been 3 minutes, begging God to smite this little demon down with a bolt of lightning.Before that could happen though, her mom noticed me just staring at her and thought I was a creeper or something because she came running over to investigate.
“Sir,” the little girl said again with her mom now standing next to her protectively, “well, would you like some cookies?”
By that point, since no lightening had come down and my will power was spent from the drive prior, I started shaking violently. Finally I screaming, “Ok! I give up,” and knocked both the little girl and her mother over as I ran to the table loaded down with boxes and boxes of multicolored Girl Scout cookies, like I was chasing gold at the end of a rainbow.
Unfortunately there was no clear sourcing in Pendergast, and I wasn’t able to find anything like this in Münsterberg’s published works. However, I did find a quote to the effect of above in a 1913 judgment of Continental Securities co. v. Belmont (!!!) in the Miscellaneous Reports: Cases Decided in the Courts of Record of the State of New York (hooray for Google books).
Business men will eventually realize that customers are merely bundles of mental states and that the mind is a mechanism that we can affect with the same exactitude with which we control a machine in a factor.
It was baffling to me why the judge handling the case included this example. As far as I can tell it’s some obscure law about securities contracts, but more to the point the judge of this opinion did not give a citation. Still, clearly some psychologist back in the early 1900s wrote/said something to this effect, and Münsterberg wouldn’t be a bad guess.
Law may be an exact science in the conception of the psychologist, who now claims that even banking and business are exact sciences, which can control them as well as any other field of social life, and by the introduction of psychology therein men will eventually realize that individuals with whom they deal are merely bundles of mental states, and that the mind is a mechanism that we (psychologists?) can affect with the same exactitude with which we control a machine in a factory.
Speaking of Münsterberg, even though his speculations about something like neuromarketing went nowhere, he pioneered IO and forensic psychology, without which business and law schools would probably look very different today. I hope it won’t take another hundred years to understand the brain processes of marketing and business in general.
The important logistic component is done by having players control a computer avatar using a joystick. This way they are able to create a large range of expressions very quickly. Everything is done in Poser and much of the code is based on software from our collaborator Jesse Spencer-Smith. Lusha wrote the rest of the code to be able to run a game in Poser. All in all, it works surprisingly smoothly!
There is a real difficulty however in conveying the quality of these expressions to colleagues (not to mention grant reviewers!). It's not that surprising in hindsight, but when you say that the players create an expression in 3 seconds, people expect something amateurish and not at all realistic. Compound that with the fact that the way people communicate in academia is still overwhelmingly print-based, and we have a situation where it's difficult to get across a sense of quality of the game. So I've decided to put up some video captures of the faces players are sending each other during games. At some point I'll have to do a screencast of a whole game so people can get a sense of the flow of the software.
This is an example of an expression sent in a stochastic dictator game, from recipient to dictator. The dictator gives the recipient a possibly unfair split. The recipient then decided to sent back the above expression. Needless to say, he is less than pleased. The whole sequence, from dictator's decision to recipient's expression, probably took less than 30 seconds.
This looks like a real-life version of the impunity game. It is similar to an ultimatum game, except rejection only reduces the responder's own payoff, and has no effect on the proposer's. So if as a responder you were offered ($8, $2) split and decide to reject, the allocation would be ($8, $0), so you lose a couple of dollars to make some kind of a point. This is an interesting game in that rejections are inequity raising, rather than reducing as in the case of the ultimatum game. This type of behavior has now been demonstrated in a couple of recent experiments using both humans and monkeys. I think there is also an older paper by Rami Zwick where this game was introduced? Anyway I can't remember.
My question though is: what is the difference between subsidies for child-bearing and marriage? If the answer is that the subsidy is patronizing in that it sounds like it's being given to the husbands, but I don't think it would be any less repugnant to the women if the money were directly given to them.
Yamagishi et al. The private rejection of unfair offers and emotional commitment. PNAS (2009) vol. 106 (28) pp. 11520-11523
Brosnan and De Waal. Monkeys reject unequal pay. Nature (2003) vol. 425 (6955) pp. 297-9
This has a similar flavor to the classic paper Fairness as a Constraint on Profit Seeking by Kahneman, Knetch, and Thaler. They explain several market anomalies by proposing that actions of otherwise profit-maximizing firms are restricted by the consumers' preferences for fairness. The definition of "fairness" is however hard to pin down, not surprisingly since the strategic and social context vary greatly. People typically agree that raising the price of a snow shovel after a snow storm is unfair; 82% in their survey rated an increase of $15 to $20 as unfair (rather stingy of the respondents I think).
They catalogue some different situations where fairness norms are violated, for example, exploitation of increased market power or protecting profits. Maybe what's tying all these together is the role of intentions in fairness interpretations. Steve and I have an upcoming perspective discussing this, so stay tuned (to all 5 of you reading).
It’ll be interesting to see whether academic starting salaries in economics fall due to the diminished demand. Somehow, I suspect that economists will cook up some new rationales that they can offer to beleaguered deans about why economists’ salaries should remain higher than what the rest of us make.
Given all of these studies are in universities, it wouldn't be too difficult to show a group of political scientists (actually you have your pick of disciplines) the pictures of their economist colleagues. I can almost see the twinkle of bemused malice in their eyes at offering $1 out of 10 to their economist colleagues in an ultimatum game. The parity in faculty compensation in Japan though is going to make this difficult. So, if you are a political scientist and genuinely enjoy seeing the misfortunes of your economics colleagues, please email me to volunteer for my new study, which I call, "Haterade in the Ivory Tower".
P.S. I don't mean to pick on the Monkey Cage. I like the blog and the entry is amusing and certainly not mean-spirited. If you are looking for the latter though, you'd be hard pressed to top this group.
Also, if one thinks it is an obvious point that fear influences risk attitude, then it should be useful to measure, say, the effects of fear on stock prices. But how does one measure the independent variable--fear? You could go around surveying traders, but you're stuck with self-report and low temporal resolution data in the best of times. Or you could measure things like galvanic skin response in real-time like Lo and Repin did, which at least gets you some indication of physiological and emotional arousal. Is this ideal? Of course not, but short of sticking electrodes in brains of traders like we do in monkey neurophysiology studies, these are the best measures we have.
A typical dictionary deﬁnition of a “straw man” is this: “To argue against a straw man is to interpret someone’s position in an unfairly weak way, and so argue against a position that nobody holds, or is likely to hold.”... A good example is self-interested preferences. This preference speciﬁcation is clearly not a straw man because that simple form of preference is actually used in many types of analysis... Furthermore, belief in self-interest is not a position nobody holds because it is often clearly espoused...