Using fMRI “heatmaps” to understand online shopping behavior

Heatmaps to observe eye movements of online shoppers have been around for a while. They’re quite helpful. But in a perfect world marketers would get direct consumer intelligence. They’d see maps of consumers’ “emotional flow,” displayed dynamically as shopping decisions are taking place.

Brace yourself. We’re getting our wish.

Armed with fMRI imagery, emotional heatmaps (my term) are being charted and analyzed. They’re yielding fascinating insights into why we choose the purchases we do.

Take the recent work of William Hedgcock and Akshay R. Rao (in this PDF report). Hedgecock is assistant professor of marketing at the University of Iowa’s College of Business. Rao is director of the Institute for Research in Marketing at the Department of Marketing & Logistics Management at the University of Minnesota. This duo has recently published findings on why some shopping decisions are so difficult to make — and how adding a “decoy” option can get consumers “unstuck” and back in the buying mood.

Overall, they are using functional magnetic resonance imaging — or fMRI — to “offer an assessment of whether and how neuroscientific techniques might be employed in the study of consumer choice in particular and consumer behavior in general.” Yeah, right. Here’s the English translation …

Relieving Aristotle’s Anxiety

This is what they did:

  1. Subjects were hooked up to fMRI machines and presented a choice between two purchases. The choice was so close in desirability a mental stalemate occurred. The consumer chose neither. (As the researchers noted, Aristotle first discussed this tendency toward stalemate by describing a person who was equally thirsty and hungry, and equidistant from food and drink. In this famous thought experiment, Aristotle’s subject remained in place until he dies.)
  2. A third choice — one less desirable than the first two — was presented in the mix. This was their decoy choice.
  3. fMRI readings showed that the mental discomfort generated by the stalemate went away. Once this anxiety level was lowered, a selection between the two “dominant” options usually followed.

Their conclusion suggested that the addition of an item, simply to hasten a decision, not only makes sense when you tally purchases, but is also validated by watching real-time fMRI heatmaps.

For e-marketers, a greater takeaway is this: The day is on its way when we can validate our assumptions about major types of “shopping cart conflicts,” and find automated ways to aviod or resolve them.

iPhone voice recognition app presages a new mobile interface

A newly-launched iPhone application allows Google searches through voice alone. This brings us closer to when non-computing types can work and play in a Web 2.0 world. Imagine: If this future comes to pass, productivity increases in many industries would be huge.

More significant to us marketers, large swaths of the workforce will no longer consider the computing world to be hostile — or at the very least, impenetrable. As I speculated two years ago many workers simply will not make portable computing a habit until it is easy enough to do through speech alone.

You might consider this Part II of a two-part post. Last week I reported on Powerset, Microsoft’s acquisition in semantic search. Now, here is an exciting stride in the the voice-recognition half of the hands-free computing equation.

Below is how the New York Times characterized the voice recognition arms race (at least, the race for the juicy prize of mobile search dominance):

Both Yahoo and Microsoft already offer voice services for cellphones. The Microsoft Tellme service returns information in specific categories like directions, maps and movies. Yahoo’s oneSearch with Voice is more flexible but does not appear to be as accurate as Google’s offering. The Google system is far from perfect, and it can return queries that appear as gibberish. Google executives declined to estimate how often the service gets it right, but they said they believed it was easily accurate enough to be useful to people who wanted to avoid tapping out their queries on the iPhone’s touch-screen keyboard.

The service can be used to get restaurant recommendations and driving directions, look up contacts in the iPhone’s address book or just settle arguments in bars. The query “What is the best pizza restaurant in Noe Valley?” returns a list of three restaurants in that San Francisco neighborhood, each with starred reviews from Google users and links to click for phone numbers and directions.

The emphasis above is mine. Here’s a demo of the new Google app for the iPhone:

This is going to get very interesting, very fast.

As Raj Reddy, an artificial intelligence researcher at Carnegie Mellon University, reported in the NY Time’s piece: “Whatever [Google] introduces now, it will greatly increase in accuracy in three or six months.”

The semantic search problem, when solved, will help computers understand what people are saying based on their wording and a phrase’s context. On the other hand, voice recognition requires something at least as daunting: Penetrating regional accents. The most visible flaw in this first full week of the iPhone app’s release is it is baffled by British accents.

Cognitive bias and effective interface design

Joshua Porter recently shared an excellent presentation on leveraging cognitive biases in the design of social networking sites. I’ve followed Joshua’s blog for years, and his thoughts on this subject reinforce my loyalty. You should know that I’ll vehemently defend the time I spend reading his stuff, even if you try to persuade me that I could be reading other, similar blogs. This die-hard loyalty is itself an example of something called a cognitive bias. It shows the Ownership Effect, one of the biases — or heuristics — that secretly influence our decisions and actions.

Heuristics are mental shortcuts. Unknowingly, our brain processes information through filters. These filters add more weight to some facts and less to others. Should real facts be scarce, heuristics can sometimes fill in the blanks.

Are cognitive biases good or bad?

The virtue of gut-based judgments is a subject of heated debate. Some think rational decisions are the best. They point to addiction and racial prejudice as two consequences of unchecked cognitive biases. Others, most famously Malcolm Gladwell, feel that heuristics have more value than they get credit for. His book Blink is full of examples of the gut overruling the brain and proving itself more accurate.

Regardless of your take on the phenomenon, as marketers we can only benefit by getting to know cognitive biases, especially in good web interface design. Lucky us: In the process we can learn a little more of how our own minds make judgments.

But be forewarned. It’s not pretty.

A bias that is particularly interesting is Loss Aversion. If I approached a random sample of people and offered them money based on the outcome of a coin toss, the wagers that they accept and refuse are far from rational. If I said I’d pay $1.25 if they win the coin toss, and the cost of the bet is a dollar, a person’s rational brain would do the math and say “Go for it.” In a fair bet, the win far outweighs the loss.

However, most pass on this offer. They refuse the likely ROI of 25%.

In fact, when the stakes are changed and other amounts are tested, it turns out that the majority of participates will hold onto their dollars until the reward increases to $2.00!

This is not rational. Even when haggling is eliminated (defined as holding out until you get the best possible offer), the majority of people walk away from making a likely profit.

Why do they do this? Because the value of not losing is twice as great as the value of winning. In a 50-50 wager, the value of losing $1.00 is equal to that of gaining $2.00. An absurd 100% ROI is the usual tipping point.

Could loss aversion be inherited from our cave-dwelling days?

Where does this reflex to avoid loss come from? Work by researcher Keith Chen with capuchin monkeys suggests that loss aversion may be innate in humans — and indeed, in other more primitive primates. In his research (purchase of white paper required — otherwise, here’s my blog entry on the topic), he sees exactly the same loss aversion in monkeys that are taught to use tokens in exchange for food as others have observed in humans playing identical games. And I mean exactly, as in: If you just looked at the numbers, you couldn’t tell human response from monkey response.

It really makes you think.

Joshua Porter gave the example of using loss aversion to get people to register on a site, with offers of “Never lose another password!” or “Don’t miss out on opportunities to save!” If the cost of loss is presented as half as great as the cost of preventing a loss, you will likely generate a simple conversion.

Paradoxically, the fear of loss is also seen in gambling. As soon as you sit down at the poker table, your more primal, reptile brain wants to ensure others do not get your chips. Even if you have a weak hand, you might try to bluff your way to victory. Even in the face of almost certain loss. To casinos, the cognitive bias of loss aversion is definitely something good.

Swoopo goads bidders in a chase for merchandise

I’ve observed this phenomenon in a truly scary “auction site.” Swoopo.com offers merchandise that you can bid on. But these aren’t true eBay-like auctions, because your bid is lost whether you win the prize or not. Everything from software to flat-screen TVs are presented with starting prices in the teens. Then participants throw their cash at the merchandise, hoping to be the last person to place their money down before the timer ends the contest.

The site’s designers have cleverly avoid gambling laws through a technicality. Their site is a “game of skill.” It is arguable that it takes skill to be the last to bid, and thus take home a prize.

But this contest is more like a carnival game of topple-the-milk-bottles. Every bid bumps up the cost of the item, but also adds seconds to the countdown clock. Yes, it’s a game of skill. But like those who have pitted their wits against a carnival game, there are far more who walk away penniless than victorious. And since there are no sweepstakes laws requiring full disclosure, you enter the game unsure of your odds of winning — even with practice.

So what force brings people back to bid again and again? And what causes bidders to pursue an item so vigorously in the face of disappointing odds?

One reason certainly has to be the thrill of the chase — the determination not to let others get the item you feel rightly entitled to claim. After all, you’ve already committed real dollars to trying to win the item! This is classic loss aversion.

Go to the site and see for yourself. Watch the bidding, which has a level of supposed transparency. You can see your opponents bid against you in real time. To watch is both thrilling and deeply chilling.

Spending time on Swoopo.com is like watching the id in pitched battle with the super ego. On this site, due to excellent interface design, the id is the only sure winner.

Web design turned on its side

We in the web design business often talk about what users see above the fold. The assumption is that people may not be compelled enough to browse down. But there are certain situations where the most suitable “browse” direction is sideways and not down. TheHorizontalWay.com is a collection of sites that turn our preconceptions on their ears. Of particular note among the collection is Interview Magazine, which uses the orientation for both novelty and to avert long load times.

The only downside of this approach that I can think of — aside from being slightly disorienting — is the mobile edition of a site would be difficult to maintain, since mobile pages are more traditionally vertical.

Can you think of other potential programs with a horizontal design?