Logo Effects on Brand Extension Evaluations from the Electrophysiological Perspective

Neural waves and short-term memory in a neural net model

We show that recognizable neural waveforms are reproduced in the model described in previous work. In so doing, we reproduce close matches to certain observed, though filtered, EEG-like measurements in closed mathematical form, to good approximations. Such neural waves represent the responses of individual networks to external and endogenous inputs and are presumably the carriers of the information used to perform computations in actual brains, which are complexes of interconnected networks. Then, we apply these findings to a question arising in short-term memory processing in humans. Namely, we show how the anomalously small number of reliable retrievals from short-term memory found in certain trials of the Sternberg task is related to the relative frequencies of the neural waves involved. This finding justifies the hypothesis of phase-coding, which has been posited as an explanation of this effect.

A systematic review of the prediction of consumer preference using EEG measures and machine-learning in neuromarketing research

Introduction

The present paper discusses the findings of a systematic review of EEG measures in neuromarketing, identifying which EEG measures are the most robust predictor of customer preference in neuromarketing. The review investigated which TF effect (e.g., theta-band power), and ERP component (e.g., N400) was most consistently reflective of self-reported preference. Machine-learning prediction also investigated, along with the use of EEG when combined with physiological measures such as eye-tracking.

Methods

Search terms ‘neuromarketing’ and ‘consumer neuroscience’ identified papers that used EEG measures. Publications were excluded if they were primarily written in a language other than English or were not published as journal articles (e.g., book chapters). 174 papers were included in the present review.

Results

Frontal alpha asymmetry (FAA) was the most reliable TF signal of preference and was able to differentiate positive from negative consumer responses. Similarly, the late positive potential (LPP) was the most reliable ERP component, reflecting conscious emotional evaluation of products and advertising. However, there was limited consistency across papers, with each measure showing mixed results when related to preference and purchase behaviour.

Conclusions and implications

FAA and the LPP were the most consistent markers of emotional responses to marketing stimuli, consumer preference and purchase intention. Predictive accuracy of FAA and the LPP was greatly improved through the use of machine-learning prediction, especially when combined with eye-tracking or facial expression analyses.

How does the use of simultaneous contrast illusion on product-background color combination nudge consumer behavior? A behavioral and event-related potential study

Color, as one of the most critical visual factors influencing consumer decisions, has been widely used in e-commerce marketing. However, the effects of product-background saturation combination on consumers’ willingness to purchase products with different heaviness attributes (e.g., heaviness-positive products or heaviness-negative products) have not been conclusively determined. The current study demonstrated the effects of product-background saturation combination on product heaviness perception and its downstream consequences. Based on behavioral method, study 1 showed that a patch of color placed in a pale background (the saturation of the background is lower than the saturation of the color patch) was perceived as visually heavier than that in a colorful background (the saturation of the background is higher than the saturation of the color patch). Study 2 applied event-related potentials (ERPs) method to explore the underlying neural mechanisms of how the interactions between the presentation modes and the product types affect consumer decisions. Behaviorally, compared to the colorful background, the pale background would lead to a higher purchase rate for the heaviness-positive products, whereas the opposite results were found for the heaviness-negative products. Furthermore, for both the heaviness-positive and heaviness-negative products, a shorter reaction time would be observed in the pale background condition than in the colorful background condition. Neurophysiologically, the pale background would result in smaller N2 component and larger P3 component compared to the colorful background for the heaviness-positive products, while the reverse held for the heaviness-negative products. Smaller N2 component implies decreased perceptual conflicts and larger P3 component implies increased decision confidence, suggesting that e-retailers should present heaviness-positive products with pale backgrounds and heaviness-negative products with colorful backgrounds.

To Each Their Own: The Impact of Regulatory Focus on Consumers’ Response to Online Information Load

Contrary to the common view that more information is always better, too much information can damage decision quality. Building on existing literature, this study identified regulatory focus as a critical factor influencing the effect of information load (IL) on online consumer decisions and used event-related potentials (ERPs) to uncover its underlying neural mechanism. Behavioral data showed that promotion-focused participants would spend less time making purchasing decisions in the low IL condition than in the high IL condition. However, no significant difference was found for prevention-focused participants. In contrast to the high IL condition, ERP data indicated that the low IL condition recruited more attentional resources at the early stage of rapid automated processing (larger P2 component), leading to reduced long-term memory conflict (smaller N2 component), and resulting in enhanced decision confidence (larger P3 component) for those with a promotion focus. However, we observed either weakened or even opposite outcomes for those with a prevention focus. These findings generally shed light on when e-retailers should provide large/small amounts of product information in online environments.

Is Distant Extension Always Upset? Neural Evidence of Empathy and Brand Association Affect Distant Extension Evaluation

Distant brand extension as an essential strategy of obtaining benefits was highly focused on the normal marketing practice and academic research. In the current study, we aim to recognize that how individuals with different levels of empathy respond to distant extensions under corporate social responsibility (CSR) and corporate competence (CC) associations to explore the corresponding neural mechanisms using event-related potentials (ERPs). We divided subjects into two groups involving a high empathy (HE) group and a low empathy (LE) group according to an empathy measure questionnaire. The subjects first faced a brand name following the CSR or CC association descriptions, and then, they were asked to evaluate the new product of brand by a five-point scale. Current results revealed that the participants of the HE group were more apt to accept the distant extension products than those of the LE group. Additionally, in the HE group, products from a brand with CSR associations were more acceptable than CC associations. Moreover, a larger N2 amplitude was elicited in the LE group than in the HE group. For the LE group, an augment N2 was found under CSR than CC associations, reflecting that LE consumers might perceive conflict when evaluating distant extensions and allocate more cognitive resources to deal with CSR information. At the later stage, the HE group showed a greater P3 than the LE group. For the HE group, an increased P3 was elicited under CSR than CC associations, suggesting that empathic individuals might show motivational salience and helping willingness toward distant extension products, especially under the CSR scenario. These results provide potential electrophysiological evidence for the positive impact of brand associations on the evaluation of distant brand extension in the case of subdividing different empathic individuals.

Neural Bases of Brand Reputation Effect on Extension Evaluation: An ERPs Study

Brand extension, as a marketing strategy, is frequently utilized by enterprises to produce new products. There exist several critical factors determining its success, such as brand reputation and perceived fit. The present study adopts the event-related potentials (ERPs) method to explore the underlying neural mechanism of the joint influence of the two factors on consumers’ evaluation of brand extension. Specifically, consumers were presented with a brand with corporate social responsibility (CSR) or corporate ability (CA) reputation, following attached to an extension product (high fit vs. low fit). And then, they were given a 5-point scale to report their acceptance intention (AI) toward the brand extension. Behavioral data showed a higher AI and a shorter reaction time for high fit in contrast to low fit conditions. For low fit conditions, consumers were more inclined to accept the extension product with a brand with CSR than CA reputation. Neurophysiologically, CSR reputation evoked a larger P2 amplitude and LPP amplitude than CA reputation. Moreover, the low fit conditions elicited a more positive LPP amplitude than the high fit conditions in the context of a brand with a CSR reputation. Yet, for a brand with a CA reputation, the effect of perceived fit was not found. These results may reflect early attention resources engagement and altruistic motivation at the late stage during brand extension evaluation. The findings provided neurological evidence for which of the two types of brand reputation (CSR vs. CA) have a more positive effect on brand extension.

Involvement of bilateral insula in brand extension evaluation: an fMRI study

The present study aims to investigate functional involvement of brain areas in consumers' evaluation of brand extension that refers to the use of well-established brand for launching new offerings. During functional magnetic resonance imaging (fMRI) scanning, participants viewed a beverage brand name followed by an extension goods name selected from the beverage or household appliance categories. They responded acceptability to given brand extension. Both acceptability responses and reaction time revealed a noticeable pattern that participants responded to acceptable stimuli more carefully. General linear model (GLM) analyses revealed the involvement of insular activity in brand extension evaluation. Especially, insular activity was lateralized according to valence. Furthermore, its activity could explain behavioral response in parametric modulation model. According to these results, we speculate that insula activity is relevant to emotional processing. Finally, we divided neural activities during brand extension into separated clusters using a hierarchical clustering-based connectivity analysis. Excluding two of them related to sensorimotor functions for behavioral responses, the remaining cluster, including bilateral insula, was likely to reflect brand extension assessment. Hence, we speculate that consumers' brand extension evaluation may involve emotional processes, shown as insular activity.

The effects of brand familiarity and product category in brand extension: An ERP study

In this paper, neural features influenced by brand familiarity and category were investigated in a brand extension experiment by using conventional event-related potentials (ERPs) and time-frequency analysis. Twenty-four participants were required to decide whether to accept the extension of one brand (stimulus 1) to a certain product category (stimulus 2) in a 2 familiarity x 2 category paradigm. Stimulus 1 consisted of household appliance brands that had different degrees of familiarity (high familiarity vs. low familiarity) to a certain participant, and stimulus 2 consisted of two categories of products (high conflict vs. low conflict). Twenty-two sets of valid data were used for data analysis. We found greater N270 amplitudes in the low-familiarity brand condition and in the high-conflict product category condition, which meant that the participants had to devote more cognitive resources when the brand was less familiar and felt more conflict when the brand was extended to the high-conflict product category. According to the time-frequency analysis results, brand familiarity and product category were found to have a significant effect on the amplitude of theta-band power (4-7.5 Hz) at frontal electrodes in the time period of 270-340 ms. This result indicated that the activity of individual nodes of the language processing networks increased when the extension product category was mismatched with respect to the brand name and that the related memory of the brand was activated and the long-term memory was extracted when the participants faced the high-familiarity brand extension. The study provides an insightful view of how brand familiarity and category influence consumers' cognitive processes regarding brand extension.

Group-Level Neural Responses to Service-to-Service Brand Extension

Brand extension is a marketing strategy leveraging well-established brand to promote new offerings provided as goods or service. The previous neurophysiological studies on goods-to-goods brand extension have proposed that categorization and semantic memory processes are involved in brand extension evaluation. However, it is unknown whether these same processes also underlie service-to-service brand extension. The present study, therefore, aims to investigate neural processes in consumers underlying their judgment of service-to-service brand extension. Specifically, we investigated human electroencephalographic responses to extended services that were commonly considered to fit well or badly with parent brand among consumers. For this purpose, we proposed a new stimulus grouping method to find commonly acceptable or unacceptable service extensions. In the experiment, participants reported the acceptability of 56 brand extension pairs, consisting of parent brand name (S1) and extended service name (S2). From individual acceptability responses, we assigned each pair to one of the three fit levels: high- (i.e., highly acceptable), low-, and mid-fit. Next, we selected stimuli that received high/low-fit evaluations from a majority of participants (i.e., >85%) and assigned them to a high/low population-fit group. A comparison of event-related potentials (ERPs) between population-fit groups through a paired t-test showed significant differences in the fronto-central N2 and fronto-parietal P300 amplitudes. We further evaluated inter-subject variability of these ERP components by a decoding analysis that classified N2 and/or P300 amplitudes into a high, or low population-fit class using a support vector machine. Leave-one-subject-out validation revealed classification accuracy of 60.35% with N2 amplitudes, 78.95% with P300, and 73.68% with both, indicating a relatively high inter-subject variability of N2 but low for P300. This validation showed that fronto-parietal P300 reflected neural processes more consistent across subjects in service-to-service brand extension. We further observed that the left frontal P300 amplitude was increased as fit-level increased across stimuli, indicating a semantic retrieval process to evaluate a semantic link between S1 and S2. Parietal P300 showed a higher amplitude in the high population-fit group, reflecting a similarity-based categorization process. In sum, our results suggest that service-to-service brand extension evaluation may share similar neural processes with goods-to-goods brand extension.

Modelling Peri-Perceptual Brain Processes in a Deep Learning Spiking Neural Network Architecture

Familiarity of marketing stimuli may affect consumer behaviour at a peri-perceptual processing level. The current study introduces a method for deep learning of electroencephalogram (EEG) data using a spiking neural network (SNN) approach that reveals the complexity of peri-perceptual processes of familiarity. The method is applied to data from 20 participants viewing familiar and unfamiliar logos. The results support the potential of SNN models as novel tools in the exploration of peri-perceptual mechanisms that respond differentially to familiar and unfamiliar stimuli. Specifically, the activation pattern of the time-locked response identified by the proposed SNN model at approximately 200 milliseconds post-stimulus suggests greater connectivity and more widespread dynamic spatio-temporal patterns for familiar than unfamiliar logos. The proposed SNN approach can be applied to study other peri-perceptual or perceptual brain processes in cognitive and computational neuroscience.

The Effects of Money on Fake Rating Behavior in E-Commerce: Electrophysiological Time Course Evidence From Consumers

Online ratings impose significant effects on the behaviors of potential customers. Thus, online merchants try to adopt strategies that affect this rating behavior, and most of these strategies are connected to money, such as the strategies of returning cash coupons if a consumer gives a five-star rating (RI strategy, an acronym for “returning” and “if”) or returning cash coupons directly with no additional requirements (RN strategy, an acronym for “returning” and “no”). The current study explored whether a certain strategy (RN or RI) was more likely to give rise to false rating behaviors, as assessed by event-related potentials. A two-stimulus paradigm was used in this experiment. The first stimulus (S1) was the picture of a product with four Chinese characters that reflected the product quality (slightly defective vs. seriously defective vs. not defective), and the second stimulus (S2) displayed the coupon strategy (RN or RI). The participants were asked to decide whether or not to give a five-star rating. The behavioral results showed that the RI strategy led to a higher rate of five-star ratings than the RN strategy. For the electrophysiological time courses, the N1, N2, and LPP components were evaluated. The slightly defective products elicited a larger amplitude of the N1 component than the seriously defective and not-defective products, reflecting that perceptual difficulty was associated with the processing of the slightly defective products. The RI strategy evoked a less negative N2 and a more positive LPP than the RN strategy, indicating that the subjects perceived less conflict and experienced stronger incentives when processing the RI strategy. These findings will benefit future studies of fake online comments and provide evidence supporting the policy of forbidding the use of the RI strategy in e-commerce.

Characteristics of Human Brain Activity during the Evaluation of Service-to-Service Brand Extension

Brand extension is a marketing strategy to apply the previously established brand name into new goods or service. A number of studies have reported the characteristics of human event-related potentials (ERPs) in response to the evaluation of goods-to-goods brand extension. In contrast, human brain responses to the evaluation of service extension are relatively unexplored. The aim of this study was investigating cognitive processes underlying the evaluation of service-to-service brand extension with electroencephalography (EEG). A total of 56 text stimuli composed of service brand name (S1) followed by extended service name (S2) were presented to participants. The EEG of participants was recorded while participants were asked to evaluate whether a given brand extension was acceptable or not. The behavioral results revealed that participants could evaluate brand extension though they had little knowledge about the extended services, indicating the role of brand in the evaluation of the services. Additionally, we developed a method of grouping brand extension stimuli according to the fit levels obtained from behavioral responses, instead of grouping of stimuli a priori. The ERP analysis identified three components during the evaluation of brand extension: N2, P300, and N400. No difference in the N2 amplitude was found among the different levels of a fit between S1 and S2. The P300 amplitude for the low level of fit was greater than those for higher levels (p < 0.05). The N400 amplitude was more negative for the mid- and high-level fits than the low level. The ERP results of P300 and N400 indicate that the early stage of brain extension evaluation might first detect low-fit brand extension as an improbable target followed by the late stage of the integration of S2 into S1. Along with previous findings, our results demonstrate different cognitive evaluation of service-to-service brand extension from goods-to-goods.