Picture a scenario where every time a potential customer contemplates your product, they feel a twinge of discomfort akin to a minor electric shock. Would they still have the inclination to buy your product? Probably not, unless they have a unique desire for discomfort.
This is not just a hypothetical scenario. Brian Knutson and his team at Stanford University embarked on a pioneering experiment that’s fundamentally altering how we think about presenting products to potential buyers. The experiment’s findings offer a deeper insight into the consumer’s mind, helping us understand the balance between pain and pleasure during the purchasing process.
In the experiment, participants were placed within an MRI scanner, a sophisticated device that captures intricate brain images by measuring blood flow intensity in various regions of the brain. As they were in the scanner, each participant was shown three elements: a product, its accompanying price, and a button to express their buying decision – a simple “yes” or “no.”
Here’s what unfolded: When an attractive product flashed on the screen, the participants’ brains showed a burst of activity. The brain’s reward centers were activated, triggering the release of dopamine, a chemical intimately linked with desire and a drive for action. This reaction is like when a food lover sees a delicious dish or a beautiful dress for a fashion enthusiast – the initial response is a surge of desire and attraction.
But then, a twist occurred when the price of the product was disclosed. Instead of the anticipated regions of the brain showing activity (those responsible for mathematical processing, decision-making, and emotional responses), a completely different area lit up: the pain centers. These centers, associated with both physical and psychological discomfort, responded to the potential loss of money as though it was a loss of other essential resources, like food or water.
This led to a groundbreaking discovery by Knutson’s team: the purchase formula. It propounds that the likelihood of making a purchase is directly correlated with the balance between the pleasure and pain experienced by the potential buyer.
Likelihood of making a purchase = (Activation in the reward center)−(Activation in the pain center)
This revelation is reshaping the marketing landscape. In the past, advertising strategies heavily leaned on promoting low prices, operating under the assumption that cost was the customer’s primary concern. However, the experiment uncovered a crucial insight: discussing prices, even if discounted, evokes a sense of discomfort in potential buyers. This discomfort, linked to the fear of financial loss, cannot be entirely eradicated by just lowering prices.
However, marketers can influence the activity in the brain’s reward center. The more positive the perception of the product, the less the impact of the price on the decision to buy. For instance, if marketing a high-end watch, focusing on exclusivity, craftsmanship, and lifetime value can enhance the activation in the reward center, making customers more willing to withstand the financial hit.
In essence, even when marketing expensive items, making them appear abundantly rewarding and valuable can significantly drive sales. This insight underscores the importance of understanding the intricate interplay between the brain’s pain and pleasure centers in influencing purchasing decisions. Making customers relish the joy of gaining something worthwhile can overshadow the pain linked to its cost, paving the way for successful sales and satisfied customers. This balanced approach is not just a strategy; it’s an art, combining psychological insights with marketing prowess for optimum results.
By grasping and employing this delicate balance in the buyer’s brain, marketers can design campaigns that deeply resonate with customers, ensuring their satisfaction and the sustained success of their products in the competitive marketplace.
Not sure how your value stacks up to your price? Contact us here and we’ll go over your offer to help ensure you’re doing the best you can at pushing the value of your offer.