Is Neuromarketing Dead?

Instead of relying on questionnaires and focus groups, isn’t it more reliable to use cold, hard data? And what better data than actual thought patterns of consumers?

The hype around neuromarketing has died down somewhat from its inception in the early 1990s, but neuromarketing itself still very much a part of the modern marketer’s toolkit. Brain scans, facial coding, and biometrics offer insights on consumers that are not available from other data sources. Fortune 500 companies (such as Forbes and Nielsen) have acquired neuromarketing firms for in-house neuromarketing divisions; there are a plethora of independent consulting firms offering the latest technologies available to marketers on a consulting basis. They promise to deliver unravel the consumer mind using biometric technologies backed by brilliant scientists.

The attraction of neuromarketing lies in its physical basis. Data gathered by carefully calibrated scientific instruments doesn’t lie. No longer do marketers have to rely on self-reported preferences and experiences of consumers and focus groups—hard data gathered on brain activity isn’t subject to uncertainty or dishonesty. It has a similar appeal to ‘big data’ as a source of insight into consumer behavior. Even honest consumers can’t always explain themselves.

This view of customers fundamentally changes the way we frame advertising in general and marketing techniques in particular. Viewing the ‘consumer’ as a biological entity with preferences influenced by emotions allows for unique insights. Marketers who can precisely define the goals of an ad campaign can use neuromarketing tools to uncover how consumers react to products. A prominent snack-food company based a packaging-switch around neuromarketing data after finding feelings of guilt and regret evoked by their shiny yellow bags.

None of this would be possible without recent developments in biometric technology. Neuromarketing techniques can be separated into two broad categories, neural imaging and physiological measurement. Imaging technologies such as fMRI, EEG, and SST measure brain activity with varying sensitivity; heart rate, facial expressions and eye-tracking can all be monitored using an array of sensors.

Currently, neuromarketing studies are limited to measuring consumer response to advertising or products. Because of the brain’s trillion-connection neural network, it is difficult to establish broad conclusions about behavior and preferences.

Neuromarketing projects face the twin problems of external validity and reverse inference. In a laboratory setting, the brain of subjects might “light up” when they are shown smiling faces or hear music, but it is hard to prove that the reverse—happy people and music make ads more engaging—is not due to experimental conditions or confounding factors. Fortunately, advertisers are often not interested in making long-term conclusions about human nature but instead want to test a specific product before it is launched. Neuromarketing provides the tools for them to do just that.

Video is not TV (part 2)

It is a waste of the ubiquitous computing power to keep using an outdated, static, TV-inspired engagement model for a dynamic online environment. Browsers have the power to enable real-time communication between users and advertisers.

This isn’t in any way an attack on television commercials; instead, it’s quite the opposite. We feel that advertisers use the same video on both TV and online publishers because monkeying with the content isn’t an easy task. The EngageClick platform has made it possible to import video advertising content that you’ve already paid for and add simple layers of engagement so you can optimize it for Web publishers.

It’s not a question of tailoring every single advertisement to have interactive capabilities, for instance. The whole problem behind using a TV commercial-style approach is that personalization of online campaigns is too high-cost. We provide an interface that allows users to layer stock engagements onto stock advertising inventory, streamlining the process for adding engagement directly into video.

It’s possible to run the same video to a wide audience using different engagement solutions for every viewer across the Web, then use our built-in analytics to discover the solutions providing the most engagement.

The important message to take away is that the possibilities of Web advertising are far greater than paying a creative for a more interesting video. We provide a vast array of different engagement layers for you to use in your video that simply aren’t available to TV advertising. Conversely, we need to move beyond the fundamentals of TV advertising when we publish video on the Web. We’re making this possible on a grand scale. It’s not about publishing custom interactive ads anymore, it’s about using individual layers of engagement to put on top of the ad inventory that’s already been made.

We’d like to make the process of channel optimization more efficient for advertisers. Instead of offering a one-off customization service to make stellar ad campaigns, like a creative might, we’d like to create technology that will let even your interns make your videos engaging. Just make sure they pick up coffee first.

Video is not TV (Part 1)

Who are your audiences? There isn’t just one type of viewer. Honestly, every content consumer in America changes audiences a dozen times a day. Every time a person moves from their car, to their couch, to their computer chair, they metaphorically change seats as well to a different audience.

To engage audiences, marketers must have a deep understanding of viewers’ attributes—and to that end, video is not TV. Television is a channel to deliver video, but video itself is not restricted by delivery method.

Television is fundamentally a broadcast experience defined by the huge size of network audiences. The impact of an ad that reaches millions of viewers at once has a huge impact. Networks charge huge prices for this privilege, and that puts a huge cost of failure onto every TV commercial. However, the huge audience guarantees that every TV commercial isn’t going to move everyone in the audience the same way. A wide net misses many fish.

Video doesn’t have to be restricted by these terms, but we’ve taken the old TV commercial model and applied it everywhere. When we see pre-roll ads on YouTube, for example, we’ve taken the TV commercial approach and fitted it into the online video experience.

Why?

Because it’s easy? It certainly is.
Because we’re restricted by technology? We certainly aren’t.
Because we haven’t come up with anything better? We have.

We’d like to focus on how to engage specific members of the audience, rather than defining the target audience. Targeting is interesting, but it’s a problem that’s common to all video channels.

The primary question for advertisers always comes back to return on investment—how do we impact more people in a cost effective way?

Advertisers are looking at an incredible opportunity to take the stock video advertising they already have to put on the Web. ROI is the main reason behind the identical advertising strategy across different video channels. It’s cheaper to take the same commercial that you’ve created for television and chop it into 30/15/6 second spots that you can air across different Internet platforms like YouTube and Vine, rather than creating an entirely customized online campaign.

We don’t see a problem with using TV-style video advertising as a starting point for online video ads, but we have a problem with the pace of innovation around the online video experience. Part 2 of the post will discuss how the EngageClick platform can use existing creatives to enable real-time communications between users and advertisers.

Gold, Just Lying on the Ground

Everybody loves free content. Free news, free videos, free blogs…let the party never stop. Who could even imagine paying for content on the Web?

Advertisers, that’s who. Coca Cola, Chevrolet and Adobe (to name a few) pay for ad space and audiences. Banner ads are cheap, and bloggers sell the real estate for them by the thousands. Video ads cost more, and content providers (Hulu and YouTube, perhaps) make a tidy profit. Even the New York Times can’t pull off paid content; about 15% of their revenue comes from digital advertising. It’s around $100 million per quarter, they’ll pull through.

All these millions in ad money pay for our beloved free content, of course, and advertisers aren’t just big-hearted softies. They expect something for sinking their profit margin into their ad budget, and the gluttonous consumers of free content (us) pay for content by clicking on their ads. We click in hordes; Facebook users in the US alone clicked 41 million times in 2011 .

That’s all old news, of course; digital advertising is where the big money is. Ads provide the only source of revenue for many online companies and blogs, and advertising is a sizeable portion of almost any website’s income.

Sadly, banner ads no longer provide streams of excited consumers flocking to e-tailers. Years of exposure to annoying display advertising has left blog readers with “banner blindness”:

Picture credit – http://c3metrics.com.

That’s what banner blindness is, and it’s killing display advertising. Ad content doesn’t even matter because users don’t even see the ads. Advertisers and creatives should be actively searching for new channels of display advertising that don’t have terrible CTR or banner blindness problems.

So…what if there was a novel source of advertising real estate that nobody’s selling on blogs, or video sites, or social networks? That’s what advertisers are dying for.

People hate seeing ads

It seems like a little thing to ask. To have free television, we have to have commercial breaks. Otherwise we have to pay for Netflix or sit through public broadcasting. Pledge week sucks.

Most people compromise and go to the bathroom during commercial breaks. Maybe you get up and go open the fridge. If you’re lazy, maybe you check your email on your phone or channel surf for a few minutes.

It’s easy to develop habits to avoid predictable advertising. Online advertising was supposed to revolutionize the ad ecosystem, with new online channels to serve ads. Yet instead, we’ve developed new habits to dodge ads.

Banner blindness is one glaring example. Eye-tracking software shows that we look everywhere except the ads on free content websites. It’s impressive how we know exactly where the ads are even on a site we’ve never surfed. Could you predict, for instance, exactly where commercials start and end on every network channel for every TV show?

When we’re forced to watch advertising, we develop routines that help us avoid seeing those ads. Whether it’s going to the bathroom or clicking the skip button, there’s no denying that we hate sitting through the ads that make our beloved free content possible.

Any long-term effective advertising channel shouldn’t be innately predictable by its target audience. If it’s easy to figure out where the ads are, viewers will find easy ways around them. A successful ad channel prevents us from forming ad-avoidance habits.

What’s truly surprising is how often online ad formats provide an option that encourages viewer attrition. Publishers like YouTube include a “Skip ad” button for viewers, which gets clicked on 70% of pre-roll ads. YouTube executives have described this as a method for discovering which ads work to engage viewers and which don’t.

The problem is how predictable these ad formats are. There’s always a way to create a habit that prevents the ad from reaching the customer. At its best, advertising is a way to show customers to products that they’re interested in. Right now we avoid every ad at the cost of missing ads for interesting products.

You could design an ad with unpredictable skipping options, which change from impression to impression. Alternatively, you could design a route for skipping the ad that leaves customers with the impression from the skip, not the main ad itself.

How We Think Different

Today the trend in digital advertising is heavily biased towards two things: taking advantage of the mobile platform and figuring out programmatic buying. Fundamentally, this is about using repetition as a tool to advance brand recognition and drive conversions/sales. About using an onslaught of ads, targeted and retargeted across multiple platforms.

Because the individual impact of display ads is so small, it takes this kind of aggregated push across many publishing sites to change a customer’s preferences and/or behavior. Both programmatic and platform integration are forces pushing the industry towards a “rain of ads” strategy, albeit one that has direct benefits for users. Counter-intuitively, targeted ads are less invasive and create a smoother online experience

We’re all for retargeting, because the technology and the data are here for us to use. Barraging users across platforms with repetitive ad spots, however, isn’t something we’re interested in. Other companies already have the personnel and the technology to innovate in that field. We at EngageClick, in the immortal words of Steve Jobs, want to think different.

By taking a closer look at what different factors control human learning, we’ve taken a different attitude towards brand lift from the majority of the industry.

We don’t think of engagement as some mystical art. Instead, we’ve taken a scientific approach to learning about human-advertising interactions. Our technology is designed around neuroscientific and psychological research on human learning and memory processing. Using some basic principles about effective learning strategies, we can speed up learning processes and increase memory formation around simple images and text.

Increasing engagement with individual ads is our primary goal. We find ways that engage consumers with advertising that adds value to their online experience. Our Human Engagement Platform® showcases the best methods we’ve developed (so far) to supercharge user engagement with individual ads.

For more information on how the HEP drives brand recognition, contact sales@engageclick.com .

What’s lacking in Mobile Ads

Tiny ads.

Fat-finger conversions.

Annoying interruptions.

These are the three biggest problems with publishing advertising on a mobile platform. Old display formats just don’t scale across platforms.

Display advertising isn’t designed for iPhone or Android devices, and it shows. Advertisers that have transferred their existing campaigns to capitalize on mobile aren’t reaping the benefits they hoped for. Search advertising is running into the same problem. Together, those two categories comprise 65% of all digital ad spending, and they just aren’t going to scale well into mobile formats.

Creatives and advertisers will have to develop mobile-specific ad formats, instead of trying to squeeze existing formats onto a tiny display. Remember how we took billboards and made them into banner ads? That’s not working out so well these days. It’s going to take platform-specific innovation that takes advantage of the innate capabilities of the device.

At EngageClick, we’re looking into how we can use the unique features of mobile devices to drive new advertising formats. To learn more about our mobile-specific solutions, contact sales@engageclick.com.

Advertising, Ecology, and Evolution

The advertising ecosystem is evolving faster than it ever has, and it’s getting harder and harder to keep up. The latest trend is native advertising—placing a brand’s message in the flow of web browsing behavior or content consumption, rather than competing with content by using peripheral advertising or interruptive pre-roll video ads.

Keeping in mind how the evolution of an ecosystem works can allow you to take advantage of the native advertising trend as it unfolds. A few key concepts from Evolution and Ecology 101:

Advertising, like nature, is constantly adapting. The Red Queen phenomenon—running as fast as you can just to stay where you are—is a staple of evolutionary biology, and it’s played out in spades on the internet, where competition is fierce. The first banner ad had a CTR of 78%, and viewers quickly developed banner blindness. Early adopters and fast-followers gain ground over publishers and agencies who are later to the party.

Red Queen

Photo credit: http://www.kpkaiser.com/wp-content/uploads/2010/10/redqueen.jpg

New adaptations gain short-term advantages over old ones, regardless of their long-term benefits. The early adopters of native advertising are going to see more benefits early on, and opportunities to use the “novel” factor will disappear. As more publishers and agencies adapt to native advertising, the long-term benefits of catching consumers mid-stream will become more prevalent.

EngageClick’s platform includes native advertising solutions that can be quickly and easily implemented. Leverage our technology to become an early adopter of this trend. Take a lesson from the Red Queen phenomenon – adopt native advertising as part of your strategy and you won’t get left behind!