To predict crowdfunding, scan consumers’ brains

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Brain activity can predict consumer choices more accurately than what consumers say they want in questionnaires, a new study of people’s decisions to back crowdfunding campaign suggests.

Surveys and self-reports are a time-honored way of trying to predict consumer behavior, but they have limitations. People often give socially desirable answers or they simply don’t know or remember things clearly.

“Surveys and behavioral reporting can work for a lot of things, but they’re not great for everything…”

The study suggests neural activity can not only be a better predictor of individual choices, but also can help forecast aggregate outcomes in the marketplace.

The researchers literally got inside people’s heads using functional magnetic resonance imaging (fMRI) to scan test participants during a decision-making task. Marketers could eventually use the findings to better predict a product’s success.

“Surveys and behavioral reporting can work for a lot of things, but they’re not great for everything,” says Carolyn Yoon, a professor of marketing at the University of Michigan. “So much consumer behavior happens at the implicit level, and traditional tools often fall short of capturing what’s unobservable.”

Yoon and colleagues measured people’s neural activity with fMRI scans while they performed a task selecting which documentary films to support on the popular crowdfunding site Kickstarter. They then asked them questions on what they thought about particular pitches.

The researchers subsequently tracked which projects achieved funding on Kickstarter. In the first study, 18 of the 36 selected projects were funded, and in the second 14 were eventually funded.

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When they evaluated both the fMRI scans and responses to the questionnaires, they found that greater activity in a specific part of the brain (the nucleus accumbens) during the decision task predicted the success of a project being funded more reliably than the questionnaires.

“Relatively early response in the brain carries a great deal of weight in predicting what people will choose for themselves as well as what others in the marketplace will choose,” Yoon says. “We did a second experiment, to check that the findings replicate and they do.”

The study shows that it’s possible to get a look into the human brain to see what drives people’s choices. That could eventually help marketers understand the biases inherent in surveys and self-reports and figure out how the neural measures and more traditional measures can be used in a complementary fashion.

While fMRI scans like the ones researchers performed in the study aren’t necessarily expensive, the more they find out about neural mechanisms the more likely they can develop better “paper and pencil” measures.

“It seems we can get a fine-grained look at what, exactly, in the brain may be driving people’s choices at the population level,” Yoon says. “Eventually this could inform marketing research about consumer decisions that rely on processes that can not be readily captured currently.”

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The researchers report their findings in the Journal of Neuroscience. Alexander Genevsky of Rotterdam School of Management and Brian Knutson of Stanford University are also coauthors.

Source: University of Michigan