Articles about 'framing'
Mon 12 Nov 2007
I’ve been waiting for the first news of neuromarketing in the 2008 U.S. presidential election, and it has arrived a full year before the election itself. The first few conclusions seem so obvious as to not require firing up a multi-millon dollar fMRI machine:
- Voters sense both peril and promise in party brands.
- Emotions about Hillary Clinton are mixed.
- Hillary Clinton and Rudy Giuliani are on opposite sides of the gender divide.
These were among eight conclusions of a brain scan study described in an New York Times Op-Ed piece, This Is Your Brain on Politics, credited to Marco Iacoboni, Joshua Freedman and Jonas Kaplan of the University of California, Los Angeles, Semel Institute for Neuroscience; Kathleen Hall Jamieson of the Annenberg Public Policy Center at the University of Pennsylvania; and Tom Freedman, Bill Knapp and Kathryn Fitzgerald of FKF Applied Research. The details involved in reaching each conclusion may be more interesting than the seemingly bland summaries. Here’s the Hillary Clinton one, for example: (more…)
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Mon 29 Oct 2007
Which is scarier - undergoing a potentially fatal surgical procedure that has a 95% survival rate, or one that causes death in 1 out of 20 patients? If you are like most people, you would find the latter statistic far more worrisome, even though mathematically the two statements are the same. A variety of research shows that marketers should choose carefully when throwing numbers at their customers. (more…)
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Tue 9 Oct 2007
Neuroeconomics research suggests that roughly 15% of your consumers are “spendthrifts” - they have unusually low sensitivity to the pain of paying, i.e., the neural discomfort associated with parting with money. Selling to people who feel little or no buying pain should be easy, right? With reduced buying inhibition, a spendthrift is more likely to take advantage of any given offer compared to a tightwad or even a normal, “unconflicted” person. Nevertheless, making the sale isn’t a given. For one, your offer is competing with other offers both for similar products or services as well as offers for dozens of other, unrelated items. Unless your spendthrift has the net worth of Bill Gates, he will have to make choices - as much as he might like to, he can’t buy everything. So, in our ongoing effort to translate academic neuroeconomics into practical neuromarketing, here are five ways to help close the deal with these free-spending customers: (more…)
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Tue 17 Oct 2006
One of the most successful sectors in the travel industry has been cruising. Megalines like Carnival and others are building ever-bigger ships to handle the increased traffic and offer more amenities. There’s no doubt that a good part of the success of the cruise industry is due to offering a product that people want: a low-stress way to visit multiple locations (no packing, unpacking, hotel check-ins, etc.) at a price that is often a better value than land-based hotels and restaurants. One additional key to the success of the cruise business may lie in neuroeconomics.
A few days ago, we talked about how extended warranties have turned into a huge industry in Warranties, Neuromarketing, and Neuroeconomics, despite the fact that the cost of the additional protection often exceeds the expected benefit by a wide margin. The continued success in the extended warranty business may be attributable in part to the way the brain processes risk analysis - a certain outcome of lower value may be chosen over a higher value but variable outcome due to processing the choice in the amygdala rather than the prefrontal cortex (see Why Negative Ads Work: Framing, Emotions, and Irrational Decisions and other posts for more on emotional decision making.) While we are in no way suggesting that selling cruises in any way resembles pushing dubious warranty extensions at the point of sale in an electronics store, there is a bit of similarity in one area: risk avoidance.
Cruises are certainly a low-risk way to visit a series of destinations. First, the availability and cost of lodging is never in doubt - there’s no last minute scramble for a wildly overpriced hotel room, or discovering that the restaurant recommended by the concierge is a budget-buster. When cruising, lodging and meals are paid for up front. In addition, the food is always “free” - the cruiser can select another dessert, hunt for a midnight snack, scarf up a slice of pizza by the pool… all at no additional cost. In addition, the quality of the food is predictable; while perception of cruise food quality may depend one’s gastronomic experience and inclinations, there’s little doubt that the food will be edible and will be replaced quickly if there’s any problem. No risk, no worry.
When they take passengers to unfamiliar ports, cruise ships may minimize perceived risk in other ways - they offer a high level of personal security, and serve as a haven if the particular destination is unpleasant, the weather is problematic, etc. Traveling by ship minimizes the risks of trying to cope in an unfamiliar place where an unfamiliar language is spoken, where merchants may or may not be entirely honest, where the police and legal system may not be bastions of incorruptibility, and so on. Again, the floating world of the cruise ship minimizes perceived risk.
There are a few important cautions in this analysis. First, the important factor is perceived risk. For instance, a few individuals are now fearful of air travel because of terrorists; the fact that air travel remains far safer than auto travel doesn’t diminish the perception of risk for those individuals. Similarly, the fact that a port destination is filled with friendly, honest people who tend to have reasonable English skills may not diminish the concern of some travelers that they would be unable to communicate and would probably be taken advantage of if they were on their own.
Second, not everyone tries to minimize all risks. Cruise vacations may not appeal to some travelers specifically because they provide so much insulation from the local environment. These vacationers may prefer the uncertainty of environments where they can travel on their own, with no fixed schedule to constrain them. Could they have a problem finding a hotel room somewhere? Perhaps… but the odds of success are good, and the downside isn’t perceived to be that serious.
With these caveats, from a neuromarketing standpoint we see continued smooth sailing for the cruise industry. As the world seems to get riskier, the potential for exploiting the emotional aspect of risk minimization will increase.
The cruise lines even do a bit of neuromarketing on the ships. On my last cruise, passengers were offered unlimited soft drinks (bar service is one of the few extra expenses on a cruise) for a payment that worked out to about $4 per day. At a per-drink cost of about $1.50, the offer makes sense for the passenger if he averages three or more sodas per day. I was ready to sign up, but after doing a quick calculation I concluded that due to the nature of the cruise I’d be unlikely to “win” on the deal. It was a port-intensive trip, meaning early-morning departures and late returns - I’m not a Coke-for-breakfast person, and it seemed unlikely that (unless I really worked at justifying the expense!) I’d consume that many soft drinks. Even so, the pull of this “no worry, no extra cost” approach was strong - in the end, I suppose, my prefrontal cortex overruled my amygdala. I purchased a few soft drinks when I wanted to, and spent a tiny fraction of what I would have spent on the “all you can drink” deal. I did see many, many passenger take advantage of the offer - some probably were heavy soft drink consumers who knew they’d benefit over the course of the cruise. Some, perhaps, were the same people who buy the $20 extended warranty for the $80 cordless phone.
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Mon 7 Aug 2006
It’s no great surprise to marketers, or even most semi-aware humans, that people often make decisions based more on emotion than on rational processing of information. Oddly, for decades economists ignored this apparent truth, assuming that business managers strove for maximum profits, buyers and sellers slid smoothly along supply and demand curves until they intersected, and so on. While some simplification of complexity is necessary and useful - think of the ubiquitous “frictionless surface” so loved by teachers of introductory physics - sometimes it can lead to poor explanations of real world phenomena. Over the years, economists have gradually poked holes in theories based on purely rational behavior, perhaps beginning with Herb Simon’s famous work showing that business managers often strove for satisfactory, rather than optimal or maximum, results. In recent years, neuroscience has entered the fray, with researchers in the new field of neuroeconomics attempting to use the tools of neuroscience to get to the root of human decision-making. Now, brain scan work conducted at the University College of London by Benedetto De Martino offers intriguing proof of the extent to which emotions rule the decision process.
The “Framing Effect”. De Martino’s work is described in a paper published in the current issue of Science, Frames, Biases, and Rational Decision-Making in the Human Brain, abstracted as,
Human choices are remarkably susceptible to the manner in which options are presented. This so-called “framing effect” represents a striking violation of standard economic accounts of human rationality, although its underlying neurobiology is not understood. We found that the framing effect was specifically associated with amygdala activity, suggesting a key role for an emotional system in mediating decision biases. Moreover, across individuals, orbital and medial prefrontal cortex activity predicted a reduced susceptibility to the framing effect. This finding highlights the importance of incorporating emotional processes within models of human choice and suggests how the brain may modulate the effect of these biasing influences to approximate rationality.
The “framing effect” refers to the difference in response to the same question framed different ways. Is a product shown to be 99% pure good? What about a product shown to contain 1% impurities? Same product, almost the same question, but the way the question is asked may elicit sets of responses that are statistically different. De Martino put this issue to the test, by asking subjects questions while they were undergoing an fMRI brain scan. His questions were based on a simple gambling proposition in which people could choose between a certain option and a gambling option. From a press release describing the work,
Subjects were presented with these choices under two different frames (i.e. scenarios), in which the sure option was worded either as the amount to be kept from the starting amount (”keep £20″), or the amount to be deducted (”lose £30″). The two options, although worded differently, would result in exactly the same outcome, i.e. that the participant would be left with £20… The UCL study found that participants were more likely to gamble at the threat of losing £30 than the offer of keeping £20. On average, when presented with the “keep” option, participants chose to gamble 43 per cent of the time compared with 62 per cent for the “lose” option.
The interesting part is what was happening in the brains of the subjects as they made their choices. In every case, both the amygdala, the brain region thought to control emotions, and the prefrontal cortex, the brain area responsibe for higher level information processing, showed activity. Subjects that exhibited more rational decision-making also showed a greater level of activity in the prefrontal cortex, suggesting that these individuals were better able to balance their emotional response with a rational evaluation process. De Martino notes,
Our study provides neurobiological evidence that an amygdala-based emotional system underpins this biasing of human decisions. Moreover, we found that people are rational, or irrational, to widely differing amounts. Interestingly, the amygdala was active across all participants, regardless of whether they behaved rationally or irrationally, suggesting that everyone experiences an emotional reaction when faced with such choices. However, we found that more rational individuals had greater activation in their orbitofrontal cortex (a region of prefrontal cortex) suggesting that rational individuals are able to better manage or perhaps override their emotional responses.
There’s a great discussion of De Martino’s work in The Framing Effect at the Economist’s View blog. The blog author reprints a great number of charts from the article, and there’s a lively discussion of the relevance of this work to the real world.
What does this research in neuroeconomics tell marketers and would-be neuromarketing practitioners? First, it’s a good reminder of what marketers already know - emotions play a big role in decisions, and the way you frame a question can shape the answer you get. Second, it highlights both the differences in response between individuals as well as their similarities. Most marketing campaigns try to frame relevant issues in a way that makes their product or service attractive; this research suggests that marketers would do well to look for those emotional hot buttons - risk of loss, pain, etc. - and consider them as they lay out the issues.
Negative Advertising. When political marketers highlight obscure or minor negative information about a candidate, they are “framing” that information in a way that makes the candidate look bad. An incumbent who “missed 14 critical opportunities to vote on matters of importance to his constituents” sounds a lot more negligent than one with a “99% perfect attendance record”. Such framing is effective - political marketers have known that negative ads often work (as much as viewers hate them), and now De Martino shows, in part, why they work. 100% of the viewers will have at least some emotional response to the negatively-phrased information. While some “rational” viewers will be able to suppress the emotional response and look at the facts, and perhaps still others will view the ad through a biased lens (see The Neuroscience of Political Marketing), some portion of the viewers are likely to let their emotions rule.
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Mon 7 Aug 2006
One of the most relevant and potentially fruitful areas for marketers hoping to employ neuroscience as one weapon in their arsenal is neuroeconomics - in essence, the neuroscience of decision making. Neuroeconomics seems to be more focused and more accepted than the embryonic field of neuromarketing; the latter field, of course, will benefit directly from findings in the former. Today, neuroeconomics got a publicity boost from USA Today in Study: Emotion rules the brain’s decisions. The article, by Dan Vergano, describes “framing” research by Benedetto De Martino of University College London.
We’ll cover De Martino’s work, published in the current issue of Science, in more detail in another post. In short, though, the researchers asked subjects the same question framed in a quite different way while the subjects were undergoing a brain scan. The scans showed multiple areas of the brain lighting up with activity; according to the researchers, the different areas represented emotions competing with rational decision-making processes, with emotions often dominating the process.
The article is balanced with a few cautions about reading too much into the results, which were based on a study of twenty subjects. Antonio Damasio of the University of Southern California in Los Angeles and Judy Illes of the Center for Biomedical Ethics at Stanford University are also quoted. Overall, I think it’s good publicity for the field - not over-hyped, but rather a brief summary of the work and some background on neuroeconomics.
The article closes with,
Though neuroeconomics is a hot field, with hundreds of researchers attending a recent meeting in Paris on the topic, Damasio says brain imaging’s biggest potential lies in teaching: “Our education system ignores the role of emotion in learning and decision-making.”
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I’ve been waiting for the first news of neuromarketing in the 2008 U.S. presidential election, and it has arrived a full year before the election itself. The first few conclusions seem so obvious as to not require firing up a multi-millon dollar fMRI machine:
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