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We take a look at the numbers and tell you where they add up and, even more importantly, where they don’t.

U.S. currency wrapped around a human brain model.
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How Our Brains Process Marketing

Source: Getty

Pricing + Perception

This Is Your Brain on Marketing

Why you should care

Because marketing influences our choices, right down to a neurological level. 

Why do Godiva chocolates taste better than Hershey’s? Coke better than RC Cola? Why do Nike kicks look fresher than Skechers?

Because they do — or at least our brains tell us they do.

When someone simply says something’s bougie, our brains really do perceive it as better — even when it’s not. Recent studies have found that when people were told a certain wine was expensive, they rated it as better than a wine listed as cheaper, regardless of its actual retail price.

A team of researchers from Dalhousie University, Vanderbilt University and other institutions randomly assigned 90 undergrad marketing students to read one of two versions of an article on different options available for hardwood floors, with advice from a designer. Both versions were exactly the same, except for the last paragraph, which emphasized either quality (“Remember that price is the first indicator of quality”) or getting the best bang for your buck (“Remember that more expensive doesn’t always mean better”).

The participants reported they tasted five distinct wines, even if there were only three, and the higher the price, the better they perceived that wine to taste.

Then the researchers randomly reassigned the students to two groups. One group was shown an ad that listed the price of a bottle of wine as only $9.99, and the other an ad that listed the wine at $39.99. Participants who had read the article that emphasized quality gave high ratings to the wine advertised as $39.99; low ratings when they saw it advertised as cheaper.

But we don’t just trick ourselves into buying more expensive stuff. Students who read the article emphasizing value were more likely to rate the cheaper wine favorably.

wine tasting with group of 5 people

The takeaway, for aspiring Mad Men out there? Lower-priced brands should emphasize value in their marketing; pricier brands should convey rarity, said Steven Povasac, professor of marketing at Vanderbilt University and a co-author of the study, published in Journal of Consumer Research in 2012.

These findings bolster research led by Caltech and Stanford researchers in 2008. In that study, 11 volunteers were hooked up to an MRI machine that scanned their brains as they drank five cabernet sauvignons, whose retail prices ranged from $5 to $90. Although they were told that all five wines were different, there were actually only three; two were given twice. The first was marked with its actual retail price of $5, as well as a fake $45 tag, while a second was labeled with its real $90 price and a $10 tag. Meanwhile, a third wine bore a label listing its actual price of $35.

The participants reported that they tasted five distinct wines, even if there were only three. And, similar to the 2012 study, the higher the price listed on the label, the better they reported that wine to taste.

Baba Shiv, a professor of marketing at Stanford and study co-author, found in an earlier study that people who paid full price for a can of Red Bull consistently solved more word puzzles than those who paid a discounted price.

Economists believe that the “experienced pleasantness” (EP) from consuming a product depends only on its intrinsic properties and the person’s state — their level of hunger or thirst, for example. But marketers know us better. They believe external stuff like branding and price can change our minds. And while that might seem obvious, here’s some neurological proof: When study participants were told that a given wine was expensive, they showed higher activity levels in the part of the brain that experiences pleasure — the medial orbitofrontal cortex, or mOFC — before they had even tasted the wine. Simple expectations can affect our experience … down to a neurological level. It’s Don Draper down to a science.

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Meet The Author Melissa Pandika

Melissa Pandika is a lab rat-turned-journalist with eye to all things science, medicine and more. Like? Distance running, snails, late-night Korean BBQ + R&B slow jams.

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