How your brain can reveal what you buy

Today's guest on Nudge can predict how likely someone is to buy a product after seeing an ad without even having to ask them a question. We predicted 100% perfectly the best ad in each category. To make his predictions, my guest doesn't have to speak to customers. He doesn't have to ask them any questions. No. Instead, he measures their heart rate along with a few other biological measures. With that information, he can make these predictions. Find out how he makes these incredible forecasts and predictions in today's episode of Nudge. Apparently, most businesses only use 20% of their data. That's like reading a book with 80% of the pages torn out. The point is, you will miss a lot. Unless you use HubSpot. Their customer platform gives you access to the data you need to grow your business. The insights that are trapped in emails and call logs and transcripts. All that unstructured data can really make a difference to your business. Because when you know more, you grow more. You won't learn much reading 20% of a book. So why settle for just 20% of your company's data? Visit HubSpot.com today to learn more. I'm Paul Zak. I'm a professor at Claremont Graduate University in California. I read a lot of books for this podcast, but Paul Zak's book really stands out in my mind. It stands out because it made a claim that I almost couldn't believe. Paul shares a study where he sprayed a hormone up participants' noses and that spray increased the participants' charitable donations by 56%. So how did Paul discover this? So starting the early 2000s, I began to run experiments to try to understand why people are ever good. The bad behavior gets all the press. Actually, very easy to study experimentally. Why are people nice to each other? Why do they help each other? Why do they cooperate? Why are they trustworthy? Based on research in animals, identified this neurochemical oxytocin as a key signal, neurochemical signal, that I should cooperate with another human. Oxytocin is a hormone that signals that a person is safe to be around. Paul calls oxytocin the 'you seem trustworthy' signal. And so we developed a protocol to measure, which had never really been done before, measure the brain's acute release of oxytocin. And then how do we prove that that oxytocin is actually causing a behavior that developed a way to safely shoot synthetic oxytocin into the brain via the nose? Specifically, Paul and his team spray oxytocin into the sinuses, and after about 45 minutes, enough oxytocin crosses the blood-brain barrier to bathe the brain in oxytocin. He's quick to add that the team have done this hundreds of times without any adverse effects on participants. We looked at whether oxytocin administration would in fact increase donation to charity. Participants watched a short video about heart disease and were then anonymously asked if they wanted to donate to the charity. One group was sprayed with this synthetic oxytocin before watching the videos, while the control group had a placebo substance squirted up their noses. We showed that if we give people synthetic oxytocin, they donated substantially more money. They were more likely to donate. That is, more people donated when prompted. Average donations were 56% higher than those who received the placebo, and the oxytocin receiving participants donated to 50% more of the featured charities. But why? So why is that? In subsequent research, we show that oxytocin is part of a larger network, which I've called immersion, which is how the brain values social-emotional experiences. So if I can communicate to you in a way that's sufficiently valuable to your brain, the brain goes, "Oh, holy crap. Apparently, the humans care about kids with cancer. I'm a human. Again, this is all unconscious. Therefore, I should help kids with cancer." And oxytocin is essentially the fuel that feeds empathy. Paul writes how oxytocin increases empathy, and when empathy is revved up, people nearly always treat others with care and kindness. So spraying synthetic oxytocin does increase donations, but you don't need a nasal spray and a lab coat to create oxytocin. The brain will create it naturally if it sees the right type of message. This is why marketing can work. So let's get to the bottom line. Because we actually, if you're marketing or you're advertising convinces me that this thing's important somehow, again, for me, neurologically, then I'm going to act on that. One way marketing does this is through emotion. Paul and his colleague Jorge wanted to test if an emotionally charged message would increase oxytocin in the brain and thus increase charitable donations. They showed one group of participants an emotionally hard-hitting video of a father talking to the camera while his two-year-old son, Ben, who has terminal cancer, plays in the background. This video is highly emotional. Paul writes how he showed it at a law conference, and a number of hardened lawyers cried after watching it. Paul and Jorge thought this video's emotionality might provoke an oxytocin response. For comparison, they found another video showing the same father and son, but this time at the zoo. This video does not mention cancer or death, but one would probably notice that the boy is bold and the voiceover calls him a miracle boy. However, this video lacks the narrative structure and emotionality of the first video. There was no crisis, there was no emotional turmoil, but it has the same characters and is the same length as the original emotional video. 145 adults were asked to watch one of these two videos. All adults were given the chance to donate money to the hospital at St Jude's, and Paul and Jorge processed 580 tubes of their blood to measure the levels of oxytocin after watching the videos. The data showed that one third of participants overall donated money to St Jude's, and that nearly all of those people who donated had watched the emotional video. The emotional video caused the brain to create oxytocin, and the high levels of oxytocin typically meant the participant donated. This feeling of importance doesn't just come from oxytocin, however. It is created by a range of neuro signals that combine to cause what Paul calls immersion. Right. So again, I'm using immersion with a capitalized term of art for a combination of neuro electrical signals that we've traced to changes in neurochemicals, that is part of a network through which the brain values social emotional experiences. So just to be clear, this is a network that took us 20 years to really discover and clarify how it works. So two main components to have a neurologic immersion, which is again a continuous variable. It can be more or less neurologically immersed in an experience. The first is I have to be present or attentive. If I'm looking over here and I'm not looking at you and paying attention to what you're saying, it's not going to be a valuable experience for me because I'm involved in doing something else. And the second is that experience has to generate what I call emotional resonance. Emotions are how the brain tags experiences with value. It's got to be important enough to me. So the present part is driven by the frontal binding of a neurochemical dopamine, and the emotional resonance is associated with the binding of oxytocin. So dopamine and oxytocin interact with each other in fairly complex ways that induce electrical activity that we can measure every second with technology we've developed. So by mapping over the course of marketing or customer experience or whatever you're doing, that immersion, which is generally kind of a sine wave, when I see that big peak in immersion, the brain again, unconsciously, this is from the brainstem, old parts of the brain out of conscious awareness. So like, oh, holy crap, I really love this thing. This is this is officially valuable to you. And it didn't take long for big businesses to want to test Paul's claims. They wanted to use immersion to try and forecast and predict. Advertisers wanted to see if their ads generated immersion. And for the 2014 Super Bowl, that's exactly what Paul decided to test. This study came about because the stuff I do gets in the media. And once we were doing work in the laboratory, companies started coming to my lab saying, "Hey, we want to create better advertising, more effective marketing. Can you help us?" At the time, we had these very expensive machines and lots of PhD students in my lab said, "Sure, we'll do some work for you." And we would analyze marketing materials that they were developing or had released and then show them the neurologic immersion. Once we started doing more of this commercially, I started getting this feeling like, "Gosh, should you really pay me for this? Maybe I've been lucky in the lab." And lab is a very controlled setting, right? So it was coming up to the Super Bowl, which is generally in early February. And I'm like, "Oh, this is great. Let's just test our technology against Super Bowl ads because for 30, 40 years, they are ranked by how much people like them." Paul set out to predict which of the 2014 Super Bowl ads viewers would like the most. But he didn't find the results that he expected. "We ran this and we find the worst result you can ever get, which is a zero relationship between these hundreds of thousands of people that rank Super Bowl ads for how much they like them and neurologic immersion." Paul measured immersion while 35 people watched the 2014 ads in a random order. And then he compared the results to those of the USA Today ratings. He found zero correlation between neurologic immersion and how much the USA Today readers said they liked the ads. "So then you go home and you go, "Well, I suck. I got to get a different job because clearly I don't know what I'm doing." And then literally I woke up like three in the morning having a panic attack and going, "Wait, hold on. Maybe the machines weren't calibrated." "Maybe the 35 people we measured were insane. I mean, who knows how kinds of things?" "So let's go back and get all the Super Bowl commercials from the year before, get fresh people, calibrate the machines, rerun the study. We found the same thing, a zero correlation between these rankings of Super Bowl commercials and what we found neurologically had the highest immersion." Paul found no link between the consciously reported enjoyment and the brain's immersion. But Paul realized he may have made a mistake. He was asking participants what they thought, not measuring how they acted. In general, humans are very bad at explaining how they feel. Perhaps the immersive ads were encouraging people to act in unconscious ways. So Paul set out to measure participants' behavior instead. Let's get some objective measure of the impact of these ads. What we have is YouTube views and YouTube comments. And what we found was that that liking measure, self-report measure, had a negative relationship between YouTube views and YouTube comments. And yet, neurologic immersion had a positive correlation. So in other words, in human language, the more people said they liked an ad, the less buzz it created. But the higher their neurologic immersion, the more buzz it created. So buzz, again, is our proxy here for sales. Paul found a link between immersion and YouTube views, not just for the 2014 Super Bowl, but for every Super Bowl they measured. The values for the 2018 Super Bowl are typical. The correlation between immersion and YouTube views is 0.27, and the correlation between immersion and YouTube comments is 0.25. This means that the commercials with higher immersion received more views and more comments. Immersion causes people to take action. Compare this to how well the USA Today ratings predicted actions here. You will find a negative relationship between YouTube views and comments. The correlations for the 2018 Super Bowl are -0.33 for views and -0.38 for comments. So what causes this mismatch? Why do participants say they like ads that don't generate any buzz? I asked Paul. Next time you're watching TV or YouTube, look how many babies and puppies you see in commercials. They have nothing to do with babies and puppies. Commercials for toilet paper or, I don't know, travel to Gibraltar. Why? Because if you put a baby or a puppy in your commercial and you test market it, yeah, so do you like the commercial? Well, sure, puppies. Who doesn't like the commercial of puppies? So I think we are living in this what I call the Freudian hangover. From this whack job Freud, we think that somehow, if I just poke you the right way, I can make the unconscious conscious. The brain does not work that way. It just doesn't work. It's like asking your liver how much it enjoyed your lunch fill today. You're like, that's just a dumb question. Well, because our brain creates language doesn't mean we have any insight into its inner workings. And so by having technology to measure what is most valued, and again, what is valued is what is acted on, then we break that dilemma between what I think and what's really happening in my brain. Participants in a focus group will say that ads with puppies are always preferred. But unconsciously, that tends not to be the case. The most immersive ad from the 2018 Super Bowl didn't have any puppies. The most immersive commercial, neurologically immersive commercial from the 2018 Super Bowl was a Diet Coke ad for twisted mango. Diet Coke twisted mango, because oh. So this is a very weird ad of this super tall woman dressed weirdly who's kind of dancing in this weird way and talking about this new flavored Diet Coke. And Diet Coke had had had flat sales for about three years. They ran this ad, their sales went up Q1 when this ad came out. Now they had introduced these new flavored Diet Cokes, but also had a big ad campaign. So again, I can't tell you for sure, it's the ad that drove the sales, but at least they run in the right direction. It's a weird commercial. So what we've learned from measuring now thousands of thousands of commercials, measuring immersion, is that the brain likes this novelty. So it's not a likable commercial. I use it a lot when I speak to marketers. This is not a likable commercial. Out of the 65 ads from that year's Super Bowl, Diet Coke mango twist was the most immersive ad Paul tested. And yet USA Today readers ranked it dead last for likability. My reply to that is, I don't care. I don't care if you like it. I care that it moves the markets. And as listeners know, it's emotions that move markets. So I've got to capture you emotionally. But this case is like, this is a frickin trainwreck. This woman is weird. The music's weird. It's got a yellow wall behind her. It's film based symmetrically. The whole thing is like a weird trainwreck. But it's very valuable neurologically. But if I ask someone, do you like this? I'm not even sure. Again, liking to me is the dumbest question. I don't care about liking. I care that it shakes up your brain so much ago. Holy crap. Diet Coke now makes twisted mango flavor. I'm going to try that. That's what I really want from a behavioral perspective. Paul writes how the woman and the filming are so odd that it's kind of hard not to look away from this ad. The ad is so novel, it forces us to pay attention. This of course has behavioral science backing. Novelty might not increase liking, but it does boost awareness. Rogers and Mewborn in their 1976 study found that commercials about driver safety are much more effective when they show vivid images of bloody victims rather than of test dummies, for instance. Vivid images of car crashes are far more novel to see in a TV ad. You're not likely to see them in an advertisement. And they will not make the ad more likable. People when they see ads of these vivid images won't say they prefer that ad, but it will make the ad more effective. Perhaps this weird, yet quite novel Diet Coke ad benefited from the same principle. When we look at some of the most "liked" commercials in 2018, a lot of these are beautifully produced. They have movie stars in them. They have lush scenery. They often run too long. We find it's shorter is better. Amazon in 2018 had a 90 second commercial called Alexa Looses Her Voice. In which you had these stars filling in for Alexa or whatever. Very funny commercial. It ran 90 seconds. That year it was $5.3 million for a 30 second commercial. They paid $17 million to film this plus triple that for these famous stars, Anthony Hopkins. It knows famous people. I'm afraid Brandon is a little tied up. But do let me know if there's anything I can help you with. Jessica? It was too long. If they had run that for 30 seconds, it would have been a great commercial. So again, for listeners, practically hit me hard, hit me fast, have a call to action. Alexa Looses Her Voice was kind of like brand awareness. But we're all aware of Alexa. Why are you doing brand awareness? Give me something to do. Daikouk Twisted Mango was like, "Oh, holy crap. This is a brand new thing. You might want to try this." But let's face it. YouTube views and buzz isn't really what companies want. The reason Coke and Amazon spend millions on Super Bowl ads is for sales. So does immersion predict sales? Well, Paul thinks so. In fact, he claims immersion is able to accurately predict the sales an ad will generate before it has been released. And he has evidence to prove it. We predicted 100% perfectly the best ad in each category. Find out how Paul made these predictions after this short break. Inclusion and Marketing hosted by Sonia Thompson is brought to you by the HubSpot Podcast Network, the audio destination for business professionals. Inclusion and marketing digs into the important topics like belonging and customer experience and helping you practice inclusive marketing authentically. Sonia's most recent episode is on buyer personas and I think it's a very good one to get started with. So go and listen to Inclusion and Marketing wherever you get your podcasts to check it out. Hello and welcome back. You are listening to Nudge with me, Phil Agnew. So far, Paul has explained that immersion can increase YouTube views, but can it lead to something a little bit more tangible? Can immersion, for example, predict whether or not a customer will give you their email address? Well, Paul ran a study to figure that out. This is a study in which was sponsored by a large American life insurance company. The sort of question there was, for people who let their life insurance lapse, which often happens when you are between jobs, what might influence them to get life insurance? Again, what kind of ad? And the behavioral measure was, we just want to get your email. So what we found was that neurologic immersion increased radically the number of people who gave their life insurance. So very strong positive correlation between neurologic immersion and sharing your life, sorry, your email so a life insurance agent could call you. Paul's team collected neurological data from 178 people who viewed unbranded rough cuts of video and print advertising for life insurance. Their analysis showed that those who shared their email addresses were almost always more immersed in the commercials. So you have to tell a good story. And I think what was interesting in that study was that, quote, good story was quite different for different demographics. One of the untapped markets for this company was young males. And so they don't buy a lot of life insurance. And so the only test ad that influenced young males to give their email was one of a guy who's talking on the edge of the road. You see his motorcycle underneath the car and he's talking about his girlfriend and their baby and whatever. And then you kind of realize that, oh, he's taught, he's killed. He's talking beyond the grave. And so it's like really in your face, like, you're a stupid young male, you're going to kill yourself. And if anyone depends on you, you probably should have life insurance. Young males didn't report liking this ad. But Paul's neurological study showed that they were immersed in it. Everything Paul's shared so far has convinced me that asking people if they like an ad is probably a waste of time. Yeah, if you ask them if they like it, sure, they're all nice. They're like, and what are you going to say? What kind of human being were like, oh, you're having testing some new ads you got? Oh, yeah, they're awesome. They're sure. What are you going to say? And what's your incentive to go, that's a piece of crap. Why would you actually show me that? No, it's just humans just basically don't do that, or most humans don't do that. So you have to get around that biased self report, because we're asking people this impossible question. And one way around this bias self reporting is to measure immersion, which is exactly what Paul did when he correctly predicted future sales for 18 different ads. When we first started doing this, the global ad agency, BBTO, a contact to me that's seen me in the media and they said, hey, we really want to pre test some some ads. And I said, great. Awesome. Here's the software. And they said, oh, we are very skeptical of what you're doing. And so what we like to do is test these ads, have you walked us through how to do it, measure them on whatever 60 people. And our clients, these are ads that have been released now, our clients have ranked each of those ads for the sales bump that they induced, we want you to predict blind, which ads produced the largest sales bump. So they sent us 18 ads, three from Guinness, three from Visa, three from Bud Light. Again, different companies, these are, you know, six different companies. So each company uses a different ranking system on assigning sales bump, which is already covered noisy data, because depends on weather and prices and advertising by their people. And anyway, so we, there's an ad up there saying from the head of strategy at BBTO saying that we predicted 100% perfectly the best ad in each category. So we did that for five of the six ads, they sent us one red herring, which was for Bud Light. Bud Light sales were also driven by concerts they sponsored and swag giveaways at bars and pubs. And, and so that was actually in their sales bump data. And so we, when we picked up the highest immersion ad for Bud Light, it was not the highest sales month that because that was the data were, were messy. Anyway, even in five out of six, 83% accuracy, which is pretty darn good, Paul's team correctly forecast which of those ads drove the most sales by measuring immersion. And they measured immersion not through MRI scanners or big complex tools. They did it for an app on a smartwatch. So we show that we can actually capture these immersion signals from the cranial nerves. This is like the brain's output file. Some of these cranial nerves pass to the heart. So what we showed using drug studies, so I can use drugs to manipulate the system, that if I get a time series on a heart rate, I can transform that into this dopamine oxytocin effect that I've called immersion. And I can get that from low-cost fitness wearables or smartwatches, Apple Watch, Samsung Galaxy Watch. Again, because the brain and body are talking to each other, once we trace out these pathways, then we can do this conversion to find these very subtle changes in the rhythms of the heart. Because Paul can measure immersion for a smartwatch, he's been able to run studies out of the lab and in the real world. So we had a very high-end luxury retailer, French company that I won't mention because I might be NDA, but a brand that people would know. They were very interested in solving that 80/20 problem. Why are 80% of their sales attributed to 20% of their sales staff? What are the sales staff doing? The problem with luxury retail is even if I give you a nice wearable, I can't interrupt that sales process and say, "Hi, shopping customer. We want to have you put on an Apple Watch while you shop." But because emotional states are contagious, that's how humans learn to coordinate with each other. We said, "Hey, put the wearable on your salespeople. Now, every store, every retail store has cameras everywhere because of theft issues." So you walk into a retail store, you've consented to be videotaped. So let's just film every customer interaction and measure the neurologic immersion of the salesperson, which should be a reflection of the immersion of the customer. And what they found was they could predict which customers would buy based on the immersion of the salesperson with 80% accuracy. And there was a linear, positive linear relationship between the salesperson's immersion and the amount of money that the person spent, the customer spent. Paul writes in his book that the amount customers spent increased in line with the sale associates immersion. The model showed that for an average customer, a 50% increase in immersion would result in an additional $43 of purchases. Now, that won't necessarily explain how these salespeople generate this immersion, but it did help the store identify their best sales reps. Immersion does seem to link with sales, buzz and engagement. I imagine it's exceedingly hard to consistently create campaigns that generate immersion. This is why marketing is so difficult. But if there's one important thing to take away from all of Paul's work, it's that what customers say and how they act are two very, very different things. I think the punchline for me here, what I've learned is that people lie, and they lie not because they're malicious, but because we asked them this impossible question. Is this persuasive? Do you like it? Would you watch this again? It's so easy to say yes. And any normal human who wants to be nice are like, "Yeah, you're just awesome. Do I like A or B better?" I don't know. A seems great. I mean, they're both really nice. What are you going to say? You're going to say, "This is all, every of the six ads you show me, they're all pieces of crap. I hate them all. What the hell are you wasting my time for?" Most socially adept humans are going to be like, "Oh, sure, they're, I don't know. They're great." All right. So again, I think we're asking too much of the conscious part of the brain to inform the unlying, under-conscious emotional states that really drive sales. I'll finish with a study, which I quite like. It's from consumerology, and it proves this nicely. Professor Timothy Wilson from the University of Virginia conducted a study with Richard Niesbett in which they set up a consumer evaluation of four pairs of tights, or pantyhose for those of you listening in the States. Respondents were asked to say which they thought was the best quality, and to explain why they had chosen the pair they did. They were shown these pantyhose or tights in order. See one first, then a second, then a third, then a fourth. And the results showed what the psychologists expected, a statistically significant position effect. That meant only 12% of people picked the first pair they saw, only 17% picked the second, 30% for the third, and 40% for the fourth. In other words, participants always rated the third and fourth pair of tights as significantly better than the first two. Now this had nothing to do with quality, because the four pair of tights were identical in this test. People preferred the third and fourth options due to the serial position effect. The choices we review later on tend to be perceived as better quality, as we can compare them to something else. However, when asked, nobody said they preferred those versions they saw later on because of their position. Instead they all invented reasons, as we all would. People talked about the sheerness of the pair of tights, the elasticity, the knit. No one noticed that the tights were identical, and all participants invented reasons why they preferred one pair over another. So next time you attempted to ask a customer why they brought your product, maybe hold back. Asking a customer what they think won't actually help you understand what's going on in their brain. That is all for today's episode of Nudge Folks. I do hope you enjoyed it. And if you did, I think you'll love Paul's book Immersion. Here's Paul sharing a little bit more about his book. So the reason I wrote the book, Phil, is that I'm a member of a very strange religion called CLV, Customer Lifetime Value. So it's a lot cheaper to wow that customer have him or her be loyal and be a raving fan and market for me than to pay to acquire a new customer. So every customer, every time I want to wow them and by measuring objectively the brain responses to customer service experiences, then we can create that wow experience. I've left a link to the book in the show notes. Also in the show notes, you'll find a link to sign up to my Friday newsletter. About 9,400 of you read that newsletter every week. And each week I share basically the best behavioral science tip I found in all of my reading from that week. It's a really quick and easy to read. You can actually go back and read all of the previous versions. Just click the link in the show notes to find those. It's totally free to sign up. So if you want to sign up, click the link in the show notes or go to nudgepodcast.com and click newsletter to sign up for free. Also in the show notes, you'll find a link to the Nudge YouTube channel. The latest video I have done is with Oliver Bergman. It is on the three to four hour rule, which some of you may have heard about in a previous episode. But this YouTube video is slightly different. We go into a little bit more detail about it. And it's starting to garner quite a few more views. It's clearly being picked up by the algorithm. And it's a really great summary of the rule. So if you haven't heard Oliver talk about why so many famous scholars like Darwin and Dickens and Virginia Wolfe worked for just four hours a day and go to nudgepodcast on YouTube to check out that video. You can just search for nudgepodcast on YouTube and you will find it. That is all for me this week, folks. Thank you so much for listening. Thank you to Paul Zach for coming on. And I'll be back next Monday for another episode of Nudge. Cheers.