As we’ve discussed many times, the 30-second TV ad is losing its effectiveness. Consumers have seized control of entertainment content, using technologies like TiVo, iPods, and DVDs to avoid commercials.
To persuade consumers to buy their products, many of today’s marketers are turning to approaches that are more subtle, more complex ? and more powerful. We can refer to these approaches as subliminal, because in many cases the consumers aren’t even aware that they are being exposed to marketing messages.
Consider product integration, which is a technique for building awareness of a product by incorporating it into the stories and scripts of television shows and movies. Product integration should not be confused with conventional product placement, which means simply showing a character using a product. For example, the judges on American Idol drink from cups with Coca-Cola’s logo and make no reference to the soft drink. That’s product placement.
Product integration requires the product to actually play a starring role. According to the Los Angeles Times, in the 2006 season premiere of the show 24, the main character needed to send photos of hostages to his team. He snapped pictures with a Sprint Treo 650 camera phone and told his colleagues, “They should be clear enough for you to identify [the hostages].”
On Donald Trump’s TV show, The Apprentice, competing teams are often judged on how well they promote a real-life product, such as the M-Azing candy bar. And on Extreme Makeover: Home Edition, houses are always transformed with the help of products from the show’s sponsor, Sears Roebuck.
Nielsen Media Research counted 108,261 instances of product placement or integration last year, an increase of 30 percent over the previous year.
Marketers are also creating entire programs to promote their products, and then sending them to networks as video news releases, or VNRs. These are essentially commercials designed to look like news stories. At many television stations that are facing shrinking resources ? ironically, because traditional advertising revenues can no longer support their newsgathering budgets ? these VNRs are too tempting to pass up. A study by Nielsen Media Researchfound that four-out-of-five news directors broadcast VNRs as part of their news programs several times each month.
Another subliminal marketing technique that is working is sensory manipulation at the point of purchase. When customers enter a store, studies have found that they are more likely to shop longer when certain types of music are playing. Researchers also found that when customers smell certain fragrances in stores, they spend an average of $50 more per week. And carefully designed aisle layouts direct shoppers’ eyes to the products with the highest profit margins.
Marketers are also systematically harnessing the power of buzz, which used to be a force that unpredictably turned some products into hits and others into misses. Now, companies are stealthily creating their own word of mouth for products. Because studies have shown that consumers are more persuaded by the recommendations of close friends and acquaintances than they are by advertising, “buzz” can strongly influence them to buy.
According to media researcher Martin Howard, the author of We Know What You Want: How They Change Your Mind, marketers secretly hire “buzz agents” to use their products and rave about them to family members and friends. One marketing firm that specializes in creating buzz claims to have swarms of buzz agents working in every large city.
For example, BzzAgent, a Boston-based marketing firm that generates buzz for clients, has 120,000 buzz agents who have registered online. According to The Wall Street Journal, BzzAgent typically charges clients $95,000 for a word of mouth campaign involving 1,000 agents. The agents receive coupons for free samples of the product and they are asked to tell their co-workers and local store managers about it.
The Journal also reports that some small companies are converting their own customers into a buzz sales force through referral-for-reward programs. For instance, people who buy collapsible bicycles from Green Gear Cycling are encouraged to recommend the bikes to friends in exchange for $50 in cash or a $75 credit. Referrals now generate more than half of the company’s $3.5 million in revenue. One customer, a woman in her 70s, has accounted for 110 referrals and has earned two free bikes.
A similar tactic, according to Howard, is to use product seeders to spread the word about new offerings. For example, product seeders might pretend to be tourists and ask strangers to take their pictures with a new camera-phone. Or, they might wear clothes or tattoos promoting the name of a company’s brand. They also might hand out shirts and hats with the product’s logo to trendsetters at concerts and sporting events.
In all of these ways, marketers are deploying techniques to persuade unsuspecting consumers, who often fail to realize they are being bombarded with a marketing campaign, to buy products. Even better, from the advertiser’s perspective, is the fact that the consumer can’t escape the message.
It isn’t like a TV commercial that the viewer can ignore by changing the channel, skipping it with TiVo, hitting the mute button, or closing his mind to its obvious sales pitch. Instead, the new marketing approaches are embedded in the programs themselves, or in the retail environment, or in his or her daily interactions with friends and strangers.
Neuromarketing is another tool for literally getting into the minds of consumers. As described in the March 2006 issue of Trends, scientists at the BrightHouse Institute for Thought Sciences in Atlanta are using MRI machines to monitor the changes in people’s brain functions when they view brands or marketing messages.
According to The New York Times, by analyzing the patterns of cognitive activity, the scientists can tell how a subject responds. When he or she sees a product they love, the MRI typically shows increased activity in the brain’s “medial prefrontal cortex.”
By testing various messages in this way, a company can find the one that resonates most effectively in consumers’ minds. This is critical because conventional market research techniques are failing to yield useful insights. The New York Times reports that American companies now spend more than $1 billion a year on focus groups, and use the results to make decisions about the $120 billion they spend on advertising.
And yet, focus groups can’t tell companies what people really want because most individuals don’t know what they want. BrightHouse, along with 90 other neuromarketing consultancies in the U.S., promises to uncover the subconscious likes and dislikes of consumers. According to Campaign magazine, many major U.S. corporations, including Coca-Cola, General Motors, and Procter & Gamble, are now relying on insights from neuromarketing.
Based on this analysis of the subliminal advertising trend, we offer the following four forecasts:
First, expect to see the effectiveness of subliminal marketing techniques deliver spectacular successes for some advertisers ? and dismal failures for many other companies that try to duplicate their success. Like any new approaches, product seeding, sensory manipulation, and product integration will work for some companies with some products in some environments with some customers. When it does, the results will be tremendous ?and they’ll inspire imitators who won’t fare as well. Marketers must be careful not to expect to get the same results that they’ll hear and read about in the business press. For example, a company introduced a new cream cheese successfully by using buzz agents to build awareness and drive sales. Cream cheese is relatively inexpensive, so the firm could distribute coupons for free products to its agents. It’s also a product that people can discuss and share easily, so word of mouth could spread freely. The same approach is unlikely to work for a more personal product like toilet paper, or for a more expensive product like a Lexus.
Second, don’t be surprised if the advertising business model, after all the twists and turns it is going through, finally goes full-circle and ends up pretty close to where it started. The major difference is that the technological setting will be different. Consider that a survey by the Magid market research firm recently found that more than half of Millennials ? the demographic group aged 8 to 28 ? said they would be more likely to watch a 30-second commercial on their iPods in exchange for downloading a TV program for free, than they would to pay to download the show without commercials. In other words, the new generation is embracing the same model that advertisers and networks have used with prior generations: free TV shows supported by paid commercials. The only difference is the size of the screen.
Third, by 2012, neuromarketing will revolutionize the advertising industry, transforming it from an art to a science. Focus groups and other forms of traditional market research methods rely on subjective interpretations of how subjects respond to advertising messages. In many cases, people simply can’t explain what they really want or don’t want. These methods are also susceptible to various biases, such as the subject’s eagerness to please the researcher, and the researcher’s desire to please the advertiser. Once perfected, however, neuromarketing will allow researchers to see, clearly and objectively, the changes in the brain’s activity that signal a positive or negative reaction to a product, a brand, or an ad.
Fourth, privacy groups will increasingly resist neuromarketing as word of its progress reaches the mainstream. One such group is Commercial Alert, established by Ralph Nader. According to Timemagazine, the organization has lobbied Congress to investigate neuromarketing, claiming that corporations could use it to “peer into our brains” and force us to buy their products. As Jonathan Moreno, director of the Center for Biomedical Ethics at the University of Virginia Health System, warned in an Adweek7 report about neuromarketing, “If you think the stem cell controversy was hot, you haven’t seen [any]thing yet.”
References List : 1. Los Angeles Times, February 12, 2006, “Television: When the Plot Pushes Product,” by Lynn Smith. ⓒ Copyright 2006 by The Los Angeles Times. All rights reserved.2. We Know What You Want: How They Change Your Mind by Martin Howard is published by The Disinformation Company Ltd. ⓒ Copyright 2005 by Martin Howard. All rights reserved.3. The Wall Street Journal, December 27, 2005, “Enterprise: Small Firms Turn to Marketing Buzz Agents,” by Tara Siegel Bernard. ⓒ Copyright 2005 by Dow Jones & Company, Inc. All rights reserved.4. The New York Times, October 26, 2003, “There’s a Sucker Born in Every Medial Prefrontal Cortex,” by Clive Thompson. ⓒ Copyright 2003 by The New York Times Company. All rights reserved.5. Campaign, December 2, 2005, “Media: All About ... Neuromarketing.” ⓒ Copyright 2005 by Haymarketing Publishing, Ltd. All rights reserved.6. Time, October 24, 2005, “Getting Inside Your Head as “Neuro” Goes Mainstream,” by Terry McCarthy. ⓒ Copyright 2005 by Time Incorporated. All rights reserved.7. Adweek, January 16, 2006, “Inside the Consumer Mind,” by Wendy Melillo. ⓒ Copyright 2006 by VNU Business Publications, USA, Inc. All rights reserved.
