MEASURING ADVERTISING EFFECTIVENESS BEYOND TRADITIONAL METHODS NEW INSIGHTS FROM NEUROSCIENCE MARKETING COMMUNICATION Marketing communication tools Advertising Sales promotions Events and experiences Public relations and publicity Brand placement Word-of-mouth marketing Personal selling Interactive marketing 2 MARKETING COMMUNICATION Advertising objectives Create brand awareness Create/improve brand image/associations Create value for the brand Create/improve brand attitude Create consumer response 3 OUTLINE OF THE LECTURE Introduction Key constructs in advertising research (Venkatraman et al., 2015) Traditional methods for predicting advertising success (Venkatraman et al., 2015) Neurophysiological methods in advertising research (Venkatraman et al., 2015) Eye tracking Biometrics Electroencephalography (EEG) Functional Magnetic Resonance Imaging (fMRI) Social Neuromarketing (Pozharliev et al., 2015) Wrap up the lecture 4 INTRODUCTION Advertising spending worldwide 2016: $604.77 billion Advertising spending: Pre-testing In-market analyses Advertising: Rational: Conscious Emotional: Unconscious 5 INTRODUCTION Emotional advertising Hyunday car commercial for US market (Super Bowl) Rational advertising Hyunday car commercial for India market 6 KEY CONSTRUCTS IN ADVERTISING Attention: Ability to attract focus to an add Attention is not given to all visual input. Since our visual environment is cluttered, attention serves as a processing bottleneck, allowing only a selected part of sensory input to reach visual awareness. Bottom-up: rapid, automatic form of selective attention that depends on the intrinsic properties of the input, such as its colour or intensity. Top-down: volitional, focal, task-dependent mechanism, that enhances processing of the selected item. Affect: Outward expression of an emotion Valence: relative pleasantness/unpleasantness Arousal: physiological and subjective intensity 7 KEY CONSTRUCTS IN ADVERTISING Memory: Mechanism by which past experiences influence current and future behavior Encoding: During past event Consolidation: During the intervening period Retrieval: During future time Desirability: Extent to which people desire the product 8 KEY CONSTRUCTS IN ADVERTISING Can you recall the 5 differences? Can you recall the license plate number of the first car? Can you recall the color of the jacket/hat of the man in the second car? How many cars in the picture? What was the color of the motorcycle? 9 TRADITIONAL METHODS AND MEASURES Focus groups and Surveys: Participants responses Advantages: Inexpensive, accessible, quick, simple to analyze Focus on: Ad execution: Liking, excitability, recall Product featured in the ad: Attitudes and purchase intent 10 TRADITIONAL METHODS AND MEASURES Attention: Liking, excitability, relevancy Limitation: Attention precedes awareness Affect: Liking, excitability, Self Assessment scale (SAM) Limitation: Post-hoc introspection might be distorted by factors such as higher cognitive processes (Schifferstein et al., 2011, p. 58) 11 TRADITIONAL METHODS AND MEASURES Memory: Retrieval aspects to evaluate the quality of the ad Recall: partial or no cues Recognition: distinguish targets from novel distractors Limitation: cannot distinguish between encoding and retrieval Desirability: Purchase intent Changes in level of desirability for product pre- and post-ad Limitation: not capable to predict future intentions or their evolution over time 12 NEWER METHODS IN ADVERTISING RESEARCH Eye tracking: Captures not only the specific information that is being processed but also the order and duration of these processes. High temporal resolution Direct measure of attention: Bottom-up: color and luminance affect initial eye movements % of valid fixations: index of overall attention/engagement with the ad Mean dwell times: depth to which information within an ad is processed Direct measure of affect: Pupil dilation: physiological response of the sympathetic nervous system which provides information regarding the degree of arousal 13 NEWER METHODS IN ADVERTISING RESEARCH Limitations of eye tracking: Can not measure memory and desirability It does not reveal anything about the higher-level processes of attention (top-down) and comprehension of the ad content. Fixation doesn’t tell you why the person is looking at that specific point. Findings are rather superficial: For example, the size of the advertisement has been found to influence participants’ looking times. It does not record peripheral vision, which makes up 98% of our visual field. It is important to recognize that the eye tracking fixations, or hot spots, do not represent everything participants sees. Relatively expensive to buy/rent: $40,000 – $60,000/$1000 - $3000 day It can be intrusive 14 NEWER METHODS IN ADVERTISING RESEARCH Biometrics: physiological or automatic responses to external stimulus Types of physiological responses: Heart rate, breathing, skin conductance Heart rate (pulse): speed of heartbeat Measured with electrocardiogram (EKG): Electrical activity of the heart Two antagonistic systems control the heart rate: Sympathetic nervous system (SNS)/ (fight-or-flight ): Heart rate acceleration (arousal) Parasympathetic (rest-and-digest): Heart rate deceleration (calm and relaxed state) Increased heart rate deceleration Increased ability to focus Attention Increased heart rate acceleration Increased Arousal Limitation: it can not measure memory, desirability 15 NEWER METHODS IN ADVERTISING RESEARCH Breathing (respiration rate): Measured with breaths per minute (BPM) Two antagonistic systems: Sympathetic nervous system (fight-or-flight ): Increase in respiration rate (arousal) Parasympathetic (rest-and-digest): Decrease in respiration rate(calm and relaxed state) Respiration sinus arrhythmia (RSA): Undulation of heart rate (arousal) Limitation: Can not measure emotional valence, memory, desirability (Frazier, Thomas W., Milton E. Strauss, and Stuart R. Steinhauer 2004) 16 NEWER METHODS IN ADVERTISING RESEARCH Skin conductance response (SCR): electrodermal response Skin becomes better electrical conductor due to increased activity of eccrine (sweat) glands SCR to measure tonic activity of the SNS Increase in SCR amplitude and response latency (delay) Increase SNS Arousal Limitation: Can not measure emotional valence, memory, desirability 17 NEWER METHODS IN ADVERTISING RESEARCH Electroencephalography (EEG) Most commonly used neuroscience method in advertising research Recordings of the electrical activity along the cortical brain regions EEG measures voltage fluctuations resulting from ionic current flows within the neurons of the brain EEG activity reflects the summation of the synchronous activity of thousands/millions of neurons that have similar spatial orientation EEG activity show oscillations (synchronized activity over network of neurons) in different frequencies www.psych.nmsu.edu/~jkroger/lab/EEG_Introduction.html 18 NEWER METHODS IN ADVERTISING RESEARCH Scalp locations and brain regions 19 NEWER METHODS IN ADVERTISING RESEARCH www.meditationasheville.blogspot.com 20 NEWER METHODS IN ADVERTISING RESEARCH EEG frequencies: Delta (<4 Hz): Highest in amplitude and slowest in wave Frontal in adults and posterior in children Deep sleep or meditation 21 NEWER METHODS IN ADVERTISING RESEARCH EEG frequencies: Theta (4-7 Hz): Higher in young children Frontal in adults and posterior in children Drowsiness, idling, imagination, light sleep 22 NEWER METHODS IN ADVERTISING RESEARCH EEG frequencies: Alpha (8-12 Hz): Alert but relaxed, reflecting, closing eyes, inhibition Decrease posterior (occipital) alpha: Activation in the visual system Visual processing Exogenous attention (Klimesch, Sauseng, and Hanslmayr 2007) 23 NEWER METHODS IN ADVERTISING RESEARCH Increase posterior alpha Working memory (Jensen, Gelfand, Kounios, and Lisman 2002) Sensory and motor cortical alpha: Hands and arms are idle Alpha suppression as a biomarker for mirror system (MNS) activity Frontal asymmetry (less alpha band activity): Left hemisphere Positive emotions Approach motivation Right hemisphere Negative emotions Withdraw (Schmidt and Trainor 2001) (Harmon-Jones, Gable, and Peterson 2010) 24 NEWER METHODS IN ADVERTISING RESEARCH EEG frequencies: Beta (13-30 Hz): Focus, consciousness, alert, active thinking, excitement, anxious Decrease in beta power over temporal scalp locations Tasks that requires sustained monitoring of external emotional stimuli 25 NEWER METHODS IN ADVERTISING RESEARCH EEG frequencies: Gamma (30-100 Hz): Somatosensory cortex Problem solving, concentration Modulation of gamma activity in relation to memory and attention 26 NEWER METHODS IN ADVERTISING RESEARCH EEG artifacts: Biological artifacts: eye-induced artifacts, cardiac artifacts, muscleinduced artifacts Environmental artifacts: poor grounding, electronic devices, local power system 27 NEWER METHODS IN ADVERTISING RESEARCH Advantages: Low cost relative to other methods Mobility: can be used in different places Extremely high temporal resolution Relatively tolerant to subject movements Silent: allows studying auditory stimulus Extremely non-invasive and save EEG does not aggravate claustrophobia Studies can be conducted with relatively simple paradigms EEG can detect covert processing (i.e., processing that does not require a response) EEG can be used in subjects who are incapable of making a motor response 28 NEWER METHODS IN ADVERTISING RESEARCH Disadvantages: Low spatial resolution on the scalp: Requires interpretation EEG poorly measures neural activity that occurs below the upper layers of the brain (the cortex) Often takes a long time to connect a subject to EEG Signal-to-noise ratio is poor: Large sample size is required 29 NEWER METHODS IN ADVERTISING RESEARCH Functional Magnetic Resonance Imaging (fMRI) Functional MRI (fMRI) is an indirect non-invasive method of imaging brain activity. The principle relies on detecting the transient hemodynamic response (changes in the blood oxygenation) provoked by neuronal activity (neurovascular coupling) during cognitive task. Neuronal activity provokes an increase in oxygen consumption and an even higher increase in local blood flow (neurovascular coupling). As the increase in flow exceeds the increase in oxygen consumption, neuronal activity is expressed as a relative increase in oxyhemoglobin compared to deoxyhemoglobin in the activated zones. The relative decrease in deoxyhemoglobin concentration, which has a paramagnetic effect, can be detected by MRI as a weak transient rise in the T2* weighted signal. This is the BOLD contrast principle (Blood Oxygenation Level Dependent). 30 NEWER METHODS IN ADVERTISING RESEARCH Neural activations as a measure of attention Exogenous attention (color, shape, brightness) is measured through activation in primary visual cortex Endogenous attention (goals, internal states, expectations) is associated with activations in dorsolateral prefrontal cortex (dlPFC). en.wikipedia.org 31 NEWER METHODS IN ADVERTISING RESEARCH Neural activations as a measure of affect/emotions Amygdala is key part in the limbic system (the emotional brain): emotional processing Increase in amygdala activity Increase in affective intensity (emotional arousal) http://gettingstronger.org/2012/01/hormesis-and-the-limbic-brain/ 32 NEWER METHODS IN ADVERTISING RESEARCH Neural activations as a measure of memory Hippocampus activation provides a measure of the strength of encoding during the ad. Greater activation of hippocampus for remembered versus forgotten ads. It also plays important role in the consolidation of information from short-term memory to longterm memory. https://neuroanatomy.wikispaces.com/F+Limbic+System 33 NEWER METHODS IN ADVERTISING RESEARCH Neural activations as a measure of desirability Ventromedial prefrontal cortex (vmPFC): Willingness to pay for specific branded product Predicting consumer behavior Ventral striatum (primary dopaminergic target): Consumption of rewards, wanting Subsequent purchase (Blakemore, Sarah-Jayne, and Robbins 2012, p. 1186) https://www.bostonglobe.com/lifestyle/health-wellness/2011/11/07/how-willpower-works/XlOvEG4FipvZ8vM8VUNBpK/story.html 34 SOCIAL NEUROMARKETING We are social creatures. The need to reach out to and connect with others is one of the primary drivers of our behavior in every aspects of our lives. Marketing is social activity. Why do we study consumer behavior in isolation? We studied underlying neural processes associated with consumers’ adjustments to the social context? “Being with You Increases My Attention to Luxury Products: Using EEG to Understand Consumers’ Emotional Experience of Luxury Branded Products” The results of our study confirm the regulatory role of mere presence of other people on consumers’ behavior. In other words, people attend differently to visual marketing stimuli (branded products, ads) when viewed alone than in the co-presence of others. 35 SOCIAL NEUROMARKETING Event-related potentials (ERP): Time-lock and average the signal 36 SOCIAL NEUROMARKETING Selective attention provides a mechanism to bias neuronal activity to represent behaviorally relevant stimuli in cluttered scenes, irrelevant information being filtered out. (Vuilleumier 2005, p. 587) 37 SOCIAL NEUROMARKETING Mere presence of others evokes arousal (automatic physiological process) reflected by higher early selective attention (Pozharliev et al., 2015, p. 551) 38 SOCIAL NEUROMARKETING Social facilitation theory: the arousal produced by the mere presence of the others amplifies the dominant response which in our case is the allocation of attention to emotionally significant marketing visual stimuli (Pozharliev et al., 2015, p. 552) 39 SOCIAL NEUROMARKETING The modulation of attention resources toward emotionally significant visual stimuli in the mere presence conditions is most likely an unconscious process. 72.5% of the participants answered they felt no difference between viewing the marketing visual stimuli in either condition Managerial Implications: Marketers should try to create social platforms where potential customers can experience brand advertising intensely Marketers of luxury branded products should exploit the amplifying effect of mere presence in emotionally significant visual stimuli which is likely to motivate people to adjust their viewing behavior 40 WRAP UP THE LECTURE Methods, measures and constructs in advertising (Venkatraman et al., 2015, p.440 ) 41 ASSIGNMENT 2 To be submitted: Date: 12-10-2016; Time: 18:00; Location: Nood-1 Select a brand. 1) Select a recent commercial of that brand. What is the main objective of the advertisement? How would you describe the commercial message strategy (Cognitive & Affective perspective). Please elaborate. 2) What type of appeal is used in this commercial (Soft vs. Hard). Does this appeal fit the message strategy and the execution framework? Please elaborate. If no fit, what would you change to improve it? 3) Which interactive marketing tool(s) (e.g. websites, online marketing, web communities) is your brand engaged with? Can you brand benefit from using some other marketing communication tools (e.g. Brand placement, PR, Sales promotions)? Please elaborate. 42 ASSIGNMENT 2 4) Which traditional method(s) and measure(s) would you use to measure the effectiveness of the previously discussed commercial (point 1). Explain why this/these specific method(s) and measure(s). 5) Use again the selected commercial (point 1). Select two out of the four advertising constructs (attention, emotion, memory, desirability). Which neuromarketing method(s) would you use to measure the effectiveness of the selected commercial in relation to the two constructs? Explain why. . 43 REFERENCES (EXAM LITERATURE IN RED) Blakemore, Sarah-Jayne, and Trevor W. Robbins (2012), "Decision-Making in the Adolescent Brain," Nature Neuroscience, 15 (9), 1184-1191. Frazier, Thomas W., Milton E. Strauss, and Stuart R. Steinhauer (2004), "Respiratory Sinus Arrhythmia as an Index of Emotional Response in Young Adults,"Psychophysiology , 41 (1), 75-83. Jensen, O., Gelfand, J., Kounios, J., and Lisman, J. E. (2002), “Oscillations in the Alpha Band (9–12 Hz) Increase with Memory Load During Retention in a Short-Term Memory Task,” Cerebral Cortex, 12 (8), 877-882. Klimesch, Wolfgang, Paul Sauseng, and Simon Hanslmayr (2007), "EEG Alpha Oscillations: The Inhibition–Timing Hypothesis," Brain Research Reviews , 53 (1), 63-88. Pozharliev, R., Verbeke, W. J., Van Strien, J. W., and Bagozzi, R. P. 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