Tag Archives: price sensitivity

Would you have a few minutes for a brain map?

A few weeks ago, publications like The Economist and Discovery Channel reported the results of research linking price and perception of quality in wine. It was essentially a blind taste with different bottles of wine priced differently.

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However, unknown to the study participants, researchers included some of the same wines twice, presenting them as different wines with different price tags. Wine enjoyment was directly and strongly related to the perceived price tag, more so than to the actual content of the glass.

This has direct implications for marketers of luxury and premium products. Take note, Starbucks! It also means that “trading up” should not be considered just a passing fad, even if the trend is likely to be affected by an economic downturn.

The striking part is the tools that were used for this research. It was yet another example of using fMRI (functional magnetic resonance imaging) for marketing and consumer research purposes.

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Neuroscience technologies have their original roots in the medical world: as the price and the size of the equipment is decreasing, brain mapping usage is becoming widespread … from evaluating soda formulas to cars and (of course) US presidential candidates.

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In my opinion, there are at least three reasons that make MRI technology so attractive for market research.

First, unlike other research tools, it promises to reveal the real nature of audience reactions, not just what they claim to think. It also helps capturing an overall brain response to multiple sensory stimuli, which brings the results closer to real life. Finally, this type of technology brings a flavor of precision and exactness to a marketing discipline that still resembles more art than science.

There are obviously clear limits to mention: brain maps deliver fairly basic information, allowing to only read simple reactions such as pleasure and displeasure. Furthermore even if the brain response that MRI captures is more holistic in nature, the complex installation process does not bode well for spontaneity and the resulting environment will remain a far-from-perfect recreation of real life situations. Having said that, the observer effect applies to other market research techniques as well.

Implementation remains complex and limits sample sizes. I think this has an impact on the way the technology is being used: there is a clear focus on highlighting universal patterns, rather than identifying clusters and differences. Let me explain that in simpler terms 🙂

For example, if researchers could repeat their experiment on wine price and taste with a larger sample, they could start investigate a lot of other questions on the “price enjoyment factor”: Is it roughly the same for everyone or does it vary by age or sex? Does the impact vary depending on people’s disposable income? If people were to receive “bargains” on premium product, how does the size of the bargain impact their enjoyment of the product?

Even if the technology is still in its infancy, we are probably witnessing the dawn of a new era in market research. One day, brain maps may well replace surveys. In fact, here is a tell tale sign: research giant Nielsen just invested in a company called Neurofocus.

I would also expect some interesting developments coming from the videogame industry, as they have tried for years to develop control systems directly linked to brainwaves – and they would surely be interested in making two-way devices that can read how much a player is enjoying its gaming experience.

If anything, this will create a brand new field of investigation for privacy advocates!

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