Consumer Behavior and Neuro Marketing

Department of Fashion Management Studies

A Project Report on
“Applications of Neuromarketing”

Submitted in partial fulfilment for the Degree of

Master of Fashion Management

Under the guidance of

Dr. Sanjeev Malage
On
st
21 April, 2020

Submitted By:
Naveena R
Tamanna Maini

NATIONAL INSTITUTE OF FASHION TECHNOLOGY,

BENGALURU-560102

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 DECLARATION
We, hereby, declare that the research report entitled, Applications of
Neuromarketing, submitted by us to the college National Institute of Fashion
Technology, Bengaluru under the guidance of Dr. Sanjeev Malage, is our
original work and the conclusions drawn therein are based on the material
collected by us. We further declare that this report has not been submitted in
any form for any other degree/diploma/company.

Naveena R Place: Bengaluru

Date: 21st April

2020
Tamanna Maini

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 CERTIFICATE

This is to certify that Naveena R and Tamanna Maini are bonafide student of
MFM Sem-2 studying in National Institute of Fashion Technology.
They have prepared and submitted an assignment titled “Applications of
Neuromarketing” in partial fulfillment of the requirement for the award of the
degree of Master of Fashion Management during the academic year 2019-2021.

Place: Bengaluru Dr. Sanjeev Malage

Date: 21/04/20
Department of Fashion Management Studies

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 CONTENT

S.NO TOPIC PAGE NO.

.

1. Introduction 05

2. Apple: A brand that ‘Thinks Different’ 06

3. A Study on Decision Paralysis 13

4. Conclusion 14

5. References 15

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 INTRODUCTION
The modern business era is an era of advertising. Greater the advertising budget
higher the demand for your product is business mantra. However despite
spending billions on various modes of advertisement the results at times are not
as desired or expected. The main reasons being cited are that the conventional
methods which make use of questionnaires work only on the outward responses
of a consumer when exposed to an advertisement. But there is more to it than
mere exterior rationality of a consumer. Neuromarketing is an important
development in the field of understanding how the subconscious mind helps the
consumer to take decisions. It is a technique that uses neuroscience tools and
knowledge to study, explain, and forecast customer’s behavior. The ultimate
goal of the technique is to plunge into the customer’s subconscious to help
marketers better understand how their clients think to manipulate them to make
a purchase.

Neuromarketing includes the direct use of brain imaging, scanning, or other

brain activity measurement technology to measure the subject’s response to
specific products, packaging, advertising, or other marketing elements. In some
cases, the brain responses measured by these techniques may not be consciously
perceived by the subject, as majority of people don’t know exactly why they
make the decisions they do. They also don’t know how to articulate what they
want and why they want it. In marketing’s traditional focus groups, many
individuals can be swayed by the opinions of others. Hence, this data may be
more revealing than self-reporting on surveys, in focus groups, etc. 

“Consumers are biased, even when they aren’t trying to be,” said Jessica

Hawthorne-Castro, CEO at LA-based Hawthorne, digital marketing
agency. “The subconscious mind processes much more information at a quicker
pace than the conscious mind, so appealing to consumers based on
neuroscience principals offers the ability for marketers to achieve better
results,” she added.
Neuromarketing provides additional information about non-conscious reactions
that cannot be collected through traditional marketing means. It relies on
Magnetic Resonance Imaging (MRI), magnetoencephalography (MEG),
electroencephalography (EEG), facial coding, eye-tracking, biometrics, and
other technologies that help measure subconscious reaction to such marketing
elements as advertising, packaging, brand positioning, price, evaluate impact
generated by an online marketing campaign, etc.
For the purpose of our study, we have taken few case studies to understand how
neuromarketing is applied in the marketing world.

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6
 APPLE- A Brand that ‘Thinks Different’

The Psychology of iPhone,

For many people, putting their hands on the new iPhone as soon as it’s released
is a matter of life or death. They must buy it, their brains can’t stop producing
dopamine when they see the new jewel Designed by Apple in California.
This is the power of Neuromarketing strategy. Actually, companies are
exploiting your way brain sees technology to make more money from you. It’s a
new field that combines the secrets of Neuroscience with the power of
Marketing strategies. Neuromarketing experts try to understand how humans
think and use that data to make their brains want that specific product more than
anything in the life.
Neuromarketing also includes the use of neuroscience research in marketing.
For example, using fMRI or other techniques, researchers may find that a
particular stimulus causes a consistent response in the brain of test subjects, and
that this response is correlated with a desired behavior (e.g., trying something
new).

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A marketing campaign that specifically incorporates that stimulus hoping to
create that behavior can be said to incorporate neuromarketing, even though no
physical testing of subjects was done for that campaign.
In fact, in a survey earlier last year, 78% of iPhone users “couldn’t imagine
having a different
type of phone”. It
may seem wired for
you, but don’t
worry their brains
see things
differently. Your
brain on the new
iPhone: A
Religious
Experience; every
company in the
world uses this
strategy to make
their customers pay for specific products. They activate the same parts of the
brain as religious images trigger in a person of faith.
Sundeep Teki, a neuroscientist at the University of Oxford, said that this
strategy can cause the same effects of addiction for some people. He said: The
act of seeking and realizing what we desire triggers activity in the reward
network of the brain that is accompanied by the release of dopamine, which
reinforces such compulsive behaviors. Another psychological study suggests
that being an early-adopter can make people feel extremely special in their
social circle. Especially for some specific companies like Apple, Tesla, and
Google.
The problem is when this decision becomes an addiction for some people. The
psychology of iPhone explains the reason why the human brain can be fooled
easily using some Neuromarketing tactics. It stimulates some parts in the brain
to make you buy a specific product without thinking.
APPLICATION OF FMRI
If you can’t measure consumer reactions to your brand or campaign, you’ll
never know how well it’s working (or not). For instance, everyone ever wishes
their branding could be as effective as Apple’s by measuring Apple’s actual
effect on consumer brains.

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German neuroscientist Dr. Jürgen Gallinat ran an experiment comparing
reactions to Samsung and Apple products. Using fMRI (functional magnetic
resonance imaging) he confirmed his hunch. Apple products activate the more
emotional and social parts of the brain. Samsung products, on the other hand,
resonate in the pre-frontal portion, the reasonable, rational bit.
Emotional experiences have a greater chance of landing in the long-term
memory bank than information-laden experiences, so maxing out your brand’s
emotional effect directly correlates to long-term success. But to measure this,
Crude forms of market research, like surveys and focus groups, cannot bypass
thinking. If you ask someone, “Do you like this product?” you’re likely to butt
up against a cognitive bias rather than the emotional core that makes the
decisions. In other words, you’re not getting the whole truth. The Goal of
Neuromarketing: To learn how marketing stimuli affect consumers’ brains in
various contexts and how these effects translate into decisions and behaviors.
Marketing has always been about influencing the way people think.
Neuromarketing is an attempt to understand how your audience’s brains work
so you know when and how your attempts at influence work. The practice has
come about as a result of developments in three connected fields: neuroscience,
behavioral economics, and social psychology. Researchers are constantly
refining our grasp of how our brains experience, interpret, and act in relation to
various stimuli, and marketers are learning how to apply this insight to their
work.

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The figure shows the users' interest when viewing "Apple iPhone 4S Siri" TV
commercial. This index, also known as "Approach / Withdrawal index" derives
from the analysis of the cerebral activity of the selected sample.

The intensity of emotions, the ability to evoke an emotional response, through

an advertisement, a website or other elements of interest is one of the most
important challenges of marketing research. However, the role of emotions in
consumer decision-making processes is not easy to explore with traditional
research techniques. Emotions are in fact attributable to a non-rational,
profound dimension, of which we are often unaware.
A clear example of this is Martin Lindstrom’s New York Times op-ed article,
audaciously entitled, “You love your iPhone. Literally”. This claim was based
on the observation that upon presenting the sound of a vibrating iPhone to
iPhone users, functional magnetic resonance imaging (fMRI) analysis revealed
increased activation in the insula, an area claimed to be “associated with
feelings of love and compassion”. From this, Lindstrom concluded that the
iPhone users were in love with their phones. Because the insula is known to
serve a number of functions including the perception of pain and loss.

APPLICATION OF FACIAL EXPRESSION ANALYSIS

Very few brands achieve the status of being “lifestyle brands”. According to
José Chavaglia Neto and José António Filipe from Instituto Universitário de
Lisboa, consumers’ fascination for particular brands on the market is rising
considerably. Therefore, companies are trying to consistently create a strong
identification with their brand(s), what allows the company to add economic
value because people will keep buying this particular brand.
To study consumer behavior, many companies try to find effective
neuromarketing tools with predictive value. José Chavaglia Neto and José
António Filipe set out to measure value as reflected on the consumer’s face,
using a tool that automatically analyzes micro expressions. Companies would
love this insight into behavior - from the moment a consumer sees the first ad to
the moment he unpacks the box in his home.
In Neto and Filipe’s study, they investigated the effect of one commercial (Shot
on iPhone-6 by Jin C.) on consumer emotion. They asked consumers to watch
this commercial related to a specific brand (Apple) while they had a camera
capturing the consumers’ facial expressions. From such an analysis, companies

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could adjust their marketing communication strategy to take advantage of their
brands competitive positioning in the market.
Neto and Filipe used FaceReader– software for automatic measurement of facial
expressions. It automatically analyzes basic facial expressions, neutral,
contempt and three affective states. It also calculates gaze direction, head
orientation, and person characteristics.
The researchers concluded that FaceReader data showed two moments of
interest during the fifteen second video film that stood out on the emotion
curves. They found a rise in happiness when crossing the ninth second, and
explain that a sudden change of pace in the music contributes to that happiness
peak. The second emotional moment occurs precisely on the 13th second of the
video; to see what accounts for that emotional change, you are better served to
watch the video for yourself and see if you smile.

Understanding emotions in marketing, As José Chavaglia Neto and José

António Filipe state, the results obtained through the use of this kind of software
allows the mapping of emotions, in real time, generated by a marketing
stimulus. Automated facial emotion software provides another insight into the
consumer’s reaction to marketing material by focusing on one key aspect that
will help create brand loyalty: emotion.

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APPLICATION OF EFFECTIVE PACKAGING AND COLOR

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Sensory experience is the first experience customers have with your product:
how the package looks. That sensory experience continues as they touch it and
look at the images and text. The label may help customers decide whether to
buy, but if the packaging doesn’t engage them, chances are they’re not going to
buy.
Apple is an acknowledged master at creating an iconic sensory experience that
communicates its brand without any words or even a logo. Even a five year-old
can pick out an iPhone from a retail display. That’s because Apple makes its
packaging as artistic and visually appealing as the device inside. Every corner
of the box is clean. The color is an elegant, minimalist white.
Every part of the packaging is designed to be clean, simple and direct. The
design is simple in a world of clutter and constant sensory over-stimulation.
Apple’s iconic sensory experience is the literal expression of the absence of
eye-grabbing colors and images – white. And that minimalism is exactly the
thing that attracts the eye.
That sensory association is reinforced by what’s inside the box: something
elegantly presented, cleanly designed and straightforward to use. Sure, you’ve
researched the device’s specs and read reviews from dozens of other users. But
the experience of buying anything with an Apple logo comes we all gathered
around to share that un-packaging moment.
Apple creates that experience by giving as much attention to the ‘small stuff’ as
they do the big stuff. The inexpensive box gets as much attention as the
expensive devices inside.
To ensure that opening the box is a unique experience, Apple employs a
designer whose sole job is packaging. The company also has a designer is
devoted to opening hundreds of prototype boxes. That designer creates and tests
endless versions of box shape, angles and tapes. This isn’t just about esthetics.
It’s also about a package that’s easy for customers to open, easy for them to
identify the component parts, and easy for them to start using. It’s a process
that’s focused on the customer – not on, say, preventing shoplifting.
The result of this focus is that wonderful experience of unpacking an Apple
product. A visual and emotional response – a sensory experience. Published in
the European Journal of Scientific Research describes this response: “…the
packaging is perceived to be part of the product and it can be difficult for
consumers to separate the two. 

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The same study also found that package colour has the single biggest impact on
buying behaviour, followed by package design innovation and then packaging
quality. Visibility is directly connected to purchase levels, reports Scott Young
at Perception Research Services (PRS). It’s a key reason 80 percent of new
retail products fail. Visual contrast to other brands is the key, says Scott. “As a
rule of thumb, colour is the strongest tool – and the smaller the brand, the more
important it is to ‘own a colour’ on shelf. While there is no ‘magic colour’ for
creating contrast, we can say that the best solutions often involve ‘breaking the
rules’ (i.e. visual norms) of the category. Well-designed packaging also gives a
brand greater reach than advertising because, unlike advertising, the sensory
response to the packaging is recalled every time the product is used – as our
earlier example of opening a new Apple MacBook illustrates. 

PRS also found that “less is more” when it comes to text on the package, shown
in eye-tracking studies. Shoppers look at a package about 5 seconds deciding
whether to pick it up. More messages on the package mean more messages
competing for the same 5 seconds of attention – making it less likely any one
message will get through to shoppers. Again, Apple is the master here, showing
just the essentials on the box and avoiding clutter that will detract from the
brand. 

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 Too Many Choices: A Study on Decision Paralysis

Are more choices better? Contrary to what you might think, they most
often aren’t. Most us know from first-hand experience, whether we’re shopping
in the real world or online, how we can get overwhelmed with too many
choices. We feel anxious, maybe even ‘freeze’, and we feel relieved when we
see that smiling sales consultant coming over to help.
People often find it hard to make buying decisions. The theory of decision
paralysis explains why – when we are confronted by too many choices, our
brains fall prey to overthinking and freeze into inaction or a state of choice-
making paralysis.

Decision paralysis has been one of marketing’s biggest challenges since

before the internet even existed. There is a famous jam study that is often
used to bolster this point. Sheena Iyengar, a professor of business at Columbia
University and the author of “The Art of Choosing”, conducted the study in
1995.

In a California gourmet market, Professor Iyengar and her research assistants set
up a booth of samples of Wilkin & Sons jams. Every few hours, they switched
from offering a selection of 24 jams to a group of six jams. On average,
customers tasted two jams, regardless of the size of the assortment, and each
one received a coupon good for $1 off one Wilkin & Sons jam.

It was found out that sixty percent of customers were drawn to the large
assortment, while only 40 percent stopped by the small one. But 30 percent of
the people who had sampled from the small assortment decided to buy jam,
while only 3 percent of those confronted with the two dozen jams purchased a
jar.
That study raised the hypothesis that the presence of choice might be appealing
as a theory, but in reality, people might find more and more choice to actually
be debilitating.

We as consumers, if given too many choices, suffer from decision paralysis.

We are unable to decide which product to buy and which one to avoid. This is
what happens when we have been offered too many flavours of ice-creams.
We want to taste all the new flavours at the same time thus leading to decision
paralysis.

But then the question arises that “If ‘less is more’ in a shopping context, why do
people seem to prefer more choices?”

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It’s part of that dopamine effect. Information is addictive, so we tend to
continually seek more of it. However, just because people want to consume the
information, it doesn’t mean they want to act, and it’s action that matters most
to you as a marketer.
Therefore, the lesson to be learnt from this is that too much choice can spoil
what you have to offer. Thus, try to offer fewer product varieties to the
customer.

CONCLUSION
Neuromarketing is a process to promote a brand that is based on the
psychological traits of a target audience. As you can see in the above
examples, several brands use many different facets of neuromarketing to
promote their products. In recent times many companies are making use of
neuro marketing techniques for studying the consumer behaviour and reaction
patterns towards their products, prices and packaging etc. Moreover, these
techniques are actually helping them to make changes in the above aspects
according to consumer’s brain deep psyche. Be it any field, neuro marketing is
being used in many areas of market research and advertising.

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References
https://www.fiftyfiveandfive.com/introduction-neuromarketing-techniques/

https://imotions.com/blog/neuromarketing-examples/

https://www.smartinsights.com/digital-marketing-strategy/an-introduction-to-
neuromarketing/amp/

https://www.nytimes.com/2010/02/27/your-money/27shortcuts.html?_r=0%20

http://ojs.excelingtech.co.uk/index.php/IJLTFES/article/viewFile/Neto/697 
https://www.youtube.com/watch?v=VO6XEQIsCoM
https://www.mancinimarco.com/en/application-areas/neuromarketing 

https://www.youtube.com/watch?v=vw2O3om9JiU

https://www.slideteam.net/blog/why-just-market-when-you-can-neuromarket

https://www.researchgate.net/publication/329943028_Neuromarketing_in_Branding

https://www.smartinsights.com/digital-marketing-strategy/an-introduction-to-
neuromarketing/amp/

https://www.braze.com/blog/decision-paralysis-marketing/

https://www.nytimes.com/2010/02/27/your-money/27shortcuts.html?_r=0%20

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