Using advanced tools to see the human brain at work, a new generation of marketing experts may be able to test a product’s appeal while it is still being designed, according to a new analysis by two researchers at Duke University and Emory University.

So-called “neuromarketing” takes the tools of modern brain science, like the functional MRI, and applies them to the somewhat abstract likes and dislikes of customer decision-making.

Though this raises the specter of marketers being able to read people’s minds (more than they already do), neuromarketing may prove to be an affordable way for marketers to gather information that was previously unobtainable, or that consumers themselves may not even be fully aware of, says Dan Ariely, the James B. Duke professor of psychology and behavioral economics at Duke.

In a perspective piece appearing online in the journal Nature Reviews Neuroscience , Ariely and Gregory S. Berns of Emory’s departments of psychiatry, economics and neuropolicy, offer tips on what to look for when hiring a neuromarketing firm, and what ethical considerations there might be for the new field. They also point to some words of caution in interpreting such data to form marketing decisions.

Neuromarketing may never be cheap enough to replace focus groups and other methods used to assess existing products and advertising, but it could have real promise in gauging the conscious and unconscious reactions of consumers in the design phase of such varied products as “food, entertainment, buildings and political candidates,” Ariely says.

“Neuromarketing: the hope and hype of neuroimaging in business,” Dan Ariely and Gregory S. Berns. Nature Reviews Neuroscience.

Professor Ralph Keeney is helping Freakonimics blog readers learn to make better decisions.  Check out the Freakonomics site for Keeney’s guidance on how to make good decisions and minimize regret.

by Kevin Schulman

One of the most obscure organizations in the federal government is the U.S. Preventive Services Task Force which began in 1984. While convened by the government, the group is comprised of outside experts in medicine, health services research, and epidemiology.1 The task force’s job is to review the evidence around primary care services and to make recommendations to physicians about the quality of the evidence to support specific recommendations for what services should or should not be included as part of routine clinical practice.

The group’s efforts are very disciplined and scripted. Specific services are assessed on the basis of the risks and benefits to ascertain the potential “net benefit” to patients, with recommendations graded A through D (a grade of I means there is insignificant evidence to make a recommendation). A grade of A indicates high probability there is substantial benefit, B indicates high probability of moderate benefit or moderate probability of substantial benefit, C is a recommendation against a service with at least moderate evidence that the benefit is small, D is a recommendation against a service with a moderate or high evidence that there is no benefit or that the harms outweigh the benefits. The probability estimates in these statements are based on the quality of the evidence in the clinical literature on these topics.2

This group recently performed a periodic update of its 2002 recommendations for breast cancer screening.3 The task force conducted an evidence review to assess all of the new clinical studies on breast cancer screening since its last report, and it commissioned a decision analysis of different screening strategies for breast cancer to assess the net benefit or harm for each strategy.

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Professor Rick Larrick has become quite well known as an advocate for the gallons per mile standard of fuel efficiency.   He’s also been following the Cash for Clunkers program very closely, cautioning that the program’s success as an environmental initiative is contingent on its overall reduction of C02 emissions.

Now Larrick has crunched the numbers on the program’s sucess to date, and concludes in a new post on his MPGIllusion blog that the program has been effective in helping the auto industry and in reducing C02 emissions.

Professor Rick Larrick is following the cash for clunkers debate on his MPGIllusion.com blog.  Check out his recent posts to understand why replacing cars and making small MPG improvements aren’t always the greenest things to do.

Just seeing a salad on the menu seems to push some consumers to make a less healthy meal choice, according a Duke University researcher.

It’s an effect called “vicarious goal fulfillment,” in which a person can feel a goal has been met if they have taken some small action, like considering the salad without ordering it, said Gavan Fitzsimons, professor of marketing and psychology at Duke’s Fuqua School of Business, who led the research.

In a lab experiment, participants possessing high levels of self-control related to food choices (as assessed by a pre-test) avoided french fries, the least healthy item on a menu, when presented with only unhealthy choices. But when a side salad was added to this menu, they became much more likely to take the fries.
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Dan Ariely’s TED2009 presentation, “Why we think it’s OK to cheat and steal (sometimes),” is now available for viewing.  Watch it here:

The next time a contractor tells you the kitchen remodeling will be done in six weeks, you might ask him to get real and reconsider his estimate.

People often fail to remember that the world is not ideal when they predict when they will complete a project, how frequently they will exercise, or how much money they will save.  However, a subtle reminder of the difference between ideal and realistic predictions can yield a more accurate estimate, according to new research from Duke University’s Fuqua School of Business and the Wisconsin School of Business.
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As we ring in the new year, millions of people are expected to make resolutions to improve their lives. A Duke University researcher says the consequences of some personal decisions provide important reasons to stick to those vows in the coming year.

New research conducted by Fuqua Professor Ralph L. Keeney concludes that personal decisions lead to more than one million premature deaths annually in the U.S.

Keeney’s work, published in the current issue of the INFORMS journal Operations Research, shows that personal decisions are the leading cause of death in the U.S. if one takes into account the role of obesity and smoking in creating heart disease and cancer, the primary causes of death in the U.S.

“Previous researchers have identified the main causes of heart disease and cancer as smoking and being overweight, each of which results in over 400,000 deaths annually,” Keeney said.

With the number of personal choices made in a given day, many individuals don’t take a step back to look at the long-term implications of those choices, Keeney said. From having unprotected sex to not buckling the seatbelt before driving, many of these decisions can eventually result in death. Other personal decisions that lead to significant premature deaths include overconsumption of alcohol, reckless driving, homicide and suicide.

Keeney’s results showed that more than 55 percent of all deaths for individuals aged 15 to 64 can be attributed to personal decisions that have readily available alternatives. Read the rest of this entry »

This summer, Fuqua Management Professors Rick Larrick and Jack Soll published a paper in Science in which they demonstrated that consumers are more successful at comparing fuel efficiency across different cars when it is expressed in gallons per mile (GPM), instead of miles per gallon (MPG).

This weekend their work was recognized in the New York Times Magazine’s “Year in Ideas” issue, and we also launched a new GPM calculator that people can use to find their current GPM, compare cars, or see the GPM for all 2009 cars.

More information about this research, including an interactive fuel-efficiency quiz and a video of Larrick and Soll discussing their work (and commuting in Soll’s hybrid Camry), is available at mpgillusion.com.