Posts tagged Marketing

Pricing and the brain

The pricier the wine, the more we enjoy it!

wine Pricing and the brainThe wines and alcoholic beverage industry as a whole is just a huge marketing contraption, capable of churning brand after brand. It has recently been shown that the pricier the bottle and the fancier the label, the more we end up enjoying it. We have been conditioned to believe that the more we pay for a bottle of wine, it will only have to taste better; of course this is our fault from the beginning, because we are not wine experts – the price we pay for the wine is our only proxy.

Dr Rangel came to this conclusion by scanning the brains of 20 volunteers while giving them sips of wine. He used a trick called functional magnetic-resonance imaging, which can detect changes in the blood flow in parts of the brain that correspond to increased mental activity. He looked in particular at the activity of the medial orbitofrontal cortex. This is an area of the brain that previous experiments have shown is responsible for registering pleasant experiences.

Dr Rangel gave his volunteers sips of what he said were five different wines made from cabernet sauvignon grapes, priced at between $5 and $90 a bottle. He told each of them the price of the wine in question as he did so. Except, of course, that he was fibbing. He actually used only three wines. He served up two of them twice at different prices.

What is the truth?The scanner showed that the activity of the medial orbitofrontal cortices of the volunteers increased in line with the stated price of the wine. For example, when one of the wines was said to cost $10 a bottle it was rated less than half as good as when people were told it cost $90 a bottle, its true retail price. Moreover, when the team carried out a follow-up blind tasting without price information they got different results. The volunteers reported differences between the three “real” wines but not between the same wines when served twice.

via The Economist

By the way, wines are not the only things the marketing machine turned more expensive. We significantly overpay for bottled water, coffee, diamonds, weddings (etc). What else is there?

Storyteller’s creed

..or a marketer’s wet dream.

I believe that imagination is stronger than knowledge. That myth is more potent than history. I believe that dreams are more powerful than facts, that hope always triumphs over experience, that laughter is the only cure for grief, and that love is stronger than death.

Thanks Timea for bringing this up. icon smile Storytellers creed

Contextual advertising?

contextual ad 300x292 Contextual advertising?

Contextual advertising is a form of targeted advertising for advertisements appearing on websites or other media, such as content displayed in mobile browsers. (Wikipedia)

In other words, the ad system sees that you are viewing a page about travel, which it knows by having examined the words on the page or other factors. The system then delivers up in some fashion an ad that’s related to travel. That’s the “contextual” part of all this. The ad about travel fits the “context” or subject of the page.

Contextual advertising isn’t new to the world of online advertising, and it has existed since 2001. It has produced billions for online giants like Google and Yahoo but also increased the revenues for online publishers worldwide. However, it is still a flawed system (as you can see from the picture) – the whole process is automated and it is related strictly to meta words. The only chance for assuring a succesful contextual advertising system is merging it with top social networks like MySpace, Facebook, etc. where the system will better understand its users, their needs, search habbits, likes and dislikes, and serve them perfect ads – ads that they will click on.

Brand equity?!

Below you can see the results of Harris Interactive EquiTrend study which sets out to measure and rank brand equity across a range of product categories in the US. The brand with the number one equity score in 2008: Heinz Ketchup. (yeah, not Coca Cola)

harris equitrends category winners 2008 150x150 Brand equity?!

However, some of the top winners there have intrigued me, leaving me wondering what the hell is brand equity all about?! According to the article, this study of brand equity supposedly measured familiarity, quality, purchase consideration, brand expectations, distinctiveness, and trust. Ok! Maybe so, but the results are pretty hard to take – Just look at the winner over financial services: VISA – they have no physical presence, no direct customer service and support and their products are always co-branded in one way or another. So they are telling us that VISA is having the highest brand equity in the industry? icon smile Brand equity?!

What is also interesting is the brand equity winner over the software industry – MICROSOFT – when they conducted the survey, they systematically avoided Apple users? Let’s not forget Microsoft still needs to improve their brand equity, especially since people still regard them as the “evil empire”.

Bottom line is that this study proves that the whole concept of brand equity is far from being a measurable science. Maybe things will change..

Question

I really wonder if most marketers have the required empathy to run customer service? Are they up for the tasks of interacting with people, as opposed to blasting the nameless, faceless masses with messages?

Go to Top