Lecture Notes: The Influence of Unconscious Decisions on Buying Behavior

Introduction

• Researchers studied the impact of background music on wine selections at a wine store.
• Findings:
  • German music led to a preference for German wines.
  • French music led to a preference for French wines.
  • Most shoppers (over 90%) claimed music did not influence their decisions.

Key Insights on Decision Making

• Buying decisions can be influenced by subconscious factors.
• Two types of decision-making:
  • Conscious: Based on facts, logic, and reason.
  • Unconscious: Based on emotions, feelings, and intuition.

Case Study: New Coke

• In 1985, Coca-Cola altered its formula to compete with Pepsi, introducing New Coke.
• Over 200,000 taste testers preferred New Coke over the original and Pepsi.
• Despite positive taste tests, New Coke faced backlash:
  • Consumers protested for the original formula.
  • Coca-Cola received thousands of complaints daily.
• Reason for failure:
  • Missed emotional connections built over nearly 100 years with the original Coke brand.
  • Marketing created a feel-good experience associated with Coke.

Neuroscience Insights

• Study in 2004:
  • Participants preferred Coke when aware of the brand versus in blind tests.
  • Emotional and memory areas of the brain activated when drinking Coke.
• The limbic system in the brain governs emotions and memories, significantly influencing decision-making.

Importance of Neuromarketing

• Neuromarketing studies how emotions and intuitions impact consumer decisions.
• 95% of decisions are made unconsciously; emotions are vital for making choices.
• Traditional marketing often overlooks unconscious emotional experiences, leading to product failures.
• Neuromarketing aims to improve experiences for consumers and businesses.

Examples of Effective Neuromarketing

1. Google:
   • Tested different shades of blue for ad links.
   • Found one shade increased clicks by 10%, resulting in an additional $200 million in revenue.
2. Amazon:
   • A 1/10th of a second website speed increase led to $1.7 billion in sales.

Social Influence on Decision Making

• Study from 1975:
  • Participants rated cookies differently based on perceived demand, even though all cookies were identical.
• Amazon utilizes social proof (ratings, reviews) to influence purchasing decisions.

Misunderstandings about Neuromarketing

• Neuromarketing is not about mind-reading or manipulating consumers.
• Valid insights come from understanding the factors that influence choices rather than coercive tactics.

The Power of Subtle Influences

• Small changes can yield significant impacts:
  • Energy Bills:
    • Emojis showing usage compared to neighbors reduced energy consumption by 3%.
  • Urinal Spillages:
    • A simple fly image etched in urinals reduced spillage by 80%.

Conclusion

• Understanding how the brain works can lead to significant improvements in marketing and decision-making.
• Encourage finding small changes or "flies" that can create impactful results.