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Thursday, 02 October 2014

Applying the science of decision making to marketing

Far from the image of Mad Men, with creative chief Don Draper ignoring insights and creating his own unique campaigns, in the 21st century ad agencies are beginning to think differently about the value of intelligence. One of these is Draftfcb, an Interpublic Group (IPG) agency with offices across the globe, which created the Institute of Decision Making in July 2010.

Backed by partnerships with scientific thought leaders from leading academic institutions such as Stanford University and the University of California, Berkeley, it aims to use science to understand consumers’ decision-making and create new targeted marketing initiatives.

Each of the academic partners serve as consultants to the institute, providing key insights and research. The institute in turn uses the information to collaborate on thought leadership projects across its Chicago, London and Vienna offices.

Leading the initiative is executive director Matthew Willcox, formerly Draftfcb San Francisco’s head of strategic planning. Research caught up with him at a breakfast conference this week, held to promote the institute’s work to agency stakeholders.

He explained that the primary purpose of the institute was to provide clients with an understanding of instinctual thinking which they can then use to really understand how consumers form decisions and choose brands.

“To date agencies and marketers have tended to focus on the emotional and rational aspects of decision-making, but have spent less time trying to understand how instinctual or automatic triggers can be activated through brand messages and experiences. We want to align science with human understanding and really help brands understand the consumer psyche,” says Willcox.

The research gap

The main issue with traditional research right now is that it doesn’t appear to be in-depth enough to be able to really utilise the information it produces

The institute is concentrating its activities in particular on the fields of behavioural economics and neuroscience, rather than traditional research methods.

“The main issue with traditional research right now is that it doesn’t appear to be in-depth enough to be able to really utilise the information it produces. The reason for this is that people do not answer based on instinct but instead provide answers based on what they think they are supposed to say, which are then taken at face value,” Willcox argues.

What the institute intends to do instead is make use of the so-called “decision sciences” and maneuver advertising strategy around this. Instead of basing advertising around generic messaging that might trigger a handful of consumers to make a purchase, it wants to help brands target audiences in a way that activates their instinctive responses.

“It takes into account the various cognitive biases and heuristics that drive the unconscious aspects of decision-making, with elements of neuroeconomics also playing a part,” he explains.

Applied science

It’s about creating that desire first, having a map that the consumer can follow and letting them naturally reach that trigger point

Vicki Holgate, head of planning at Draftfcb London, has already put this thinking into a framework that she’s used in workshops with clients. She says the aim is to help brands enhance their understanding of what triggers a consumer to make a purchase decision and go on to provide brand advocacy.

“It’s about creating that desire first, having a map that the consumer can follow and letting them naturally reach that trigger point – be it hot weather for ice creams or watching Top Gear for a car – and then having the follow through necessary, so that after the customer buys the goods they have a relationship that meets their requirements and begins this new level of advocacy,” she says.

“Essentially it’s connecting the dots between an influencer and an advocate and forcing them into co-existing, with decision-making at the heart of it.”

DraftFCB’s approach comes from IPG research unveiled at the start of the year, called “New Realities 2012”, which analysed how consumers in Brazil, China, India and the US form decisions about buying into a brand. Far from being overloaded by information, most were open to brand communications that related to them on an emotional level and peaked their interest.

The research split human decision-making characteristics into five segments – information obsessed; information selective (the likeliest to be brand advocates); information functional; information passive (those who seek opinions from others) and information haters (those who are fed up with information).

Willcox says brands need to be aware of these differing types of consumers as they plan their marketing communications. “What we want to see is more targeting of the former [obsessed and selective] and less of the latter [passive and haters] – reducing the amount of bandwagon followers, which is still a conflicting factor. What we want is for marketers to learn how to appreciate this and communicate more towards sentiments and not just what the majority suggest needs to be actioned via social media.”

“Our goal is that learning in these emerging areas will not stop at the institute but rather proliferate through how we, as an agency, holistically approach consumer research. It’s no longer enough to just be generic and expect to win over customers – you have to adapt to the emotional needs of your target audience and win them over much faster than ever before.”

A transformation opportunity for research

Research needs to be more than just a data gathering example based on behaviour. It has to innovate to become more emotional, last longer and seem more powerful

So, can the research industry play a part in this transformation?

“Research needs to be more than just a data gathering exercise,” says Willcox. “It has to innovate to become more emotional, last longer and seem more powerful in terms of evoking action by being more real-time and less reliant on scripted responses long after a purchase is made. You have to remember that even the most hardened person doesn’t like having to explain their behaviour.

“We hate to see ourselves as irrational, which is why respondents in research will often choose a more rational approach or one which is easy to rationalise when asked to make a choice. To date, there is little evidence of the research industry innovating around this. Perhaps implicit association is one way around this - there are a range of techniques where the time in which it takes to respond is used to understand the real or implicit feelings of the respondent about stimulus. Real decision-making studies like this will make all the difference,” Willcox concludes.

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Readers' comments (1)

  • I wish any new endeavour well, but I struggle to see anything in the report that evidences the outputs of science being used.

    Cognitive psychology, behavioural economics, and the more credible bits of neuroscience have shown that certain patterns of behaviour tend to re-occur, and in a few case the first part of the pattern can be predictive, to some extent, of the latter part of the pattern (in Kahneman's bat and ball example we can predict that a surprisingly large number will get the wrong answer).

    That is science in the sense that the 19th Century botanists were scientists when they collected and named species. However, using the term science in the 21st Century would imply, IMHO, that people have identified where and how these decisions are made and have an ability to generalise them beyond the particular – and I don’t think any serious bodies are saying this has been done. For example, System 1 and System 2 do not exist in any ‘real’ sense. Researchers have not been able to find a home for them in the physical brain. But they do seem to be useful metaphors.

    I think these areas are well worth exploring, I think they will produce useful results, but I don't think we should say we are applying science for a while yet?

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