Lindstrom, Martin

Lindstrom.jpgMartin Lindstrom is the CEO and Chairman of the Lindstrom company and the Chairman of Buyology Inc., New York, and BRAND sense Agency, London.

As one of the world's most respected marketing gurus, he advises top executives at companies such as McDonald's, Nestlé, Procter & Gamble, Microsoft, Walt Disney, Unilever, and GlaxoSmithKline. Martin Lindstrom speaks to a global audience of close to a million people every year. He has been featured in numerous publications, including the Wall Street Journal, the New York Times, the Washington Post, USA Today, BusinessWeek, and Time. He's been featured on NBC's Today Show, ABC News, CNN, and BBC. His previous book, BRAND sense, was acclaimed by the Wall Street Journal as one of the five best marketing books ever published. His latest book, discussed here with Erik, is Buyology: Truth and Lies About Why We Buy, which describes his studies in the field of neuromarketing. It's a New York Times and bestseller.



[Bio adapted from his website, www.martinlindstrom.com.]

Buy the book, Buyology

tompeters.com asks ...

Martin, Buyology is based on a three-year study of neuromarketing. What is neuromarketing?

ML: Neuromarketing is basically a marriage between marketing and science. Marketing has been around for a hundred plus years; science, the same. But those very different camps have never really flirted with each other as they are right now. In principle, neuromarketing uses non-verbal expression techniques to make people express what's going on in their subconscious mind. We now know that 85 percent of everything you and I do as consumers is taking place in the subconscious mind. No one has ever been able to plug into that area, and that's why we wanted to do that. I wanted to be one of the first to set a standard in the industry.

It seems we finally have access to the inner workings of the brain. I recently interviewed the authors of Predictably Irrational and Nudge. Those books flirt with this notion that we think we're making decisions for rational reasons, when in fact all kinds of irrational things are at work in our brains. Apparently there have been some negative reactions to this field. You mention the group Commercial Alert that is dead-set against neuromarketing. What is frightening to people about this?

ML: We know from history that we fear what we don't understand. That's exactly the reason I wanted to write Buyology and conduct this amazing study, because no one has conducted a study this size before.

I wanted to explore the questions, how far can this go and how far should this go? We can start to understand what's going on in our subconscious mind with a fairly high level of accuracy. Most importantly, what are the ethics around it?

This is extraordinarily controversial. Commercial Alert, whose concerns I take very seriously, are at one end of the spectrum. They think all advertising should be banned as well as any commercial exploration of making people buy more. That's one extreme. On the other end we have people who think we should scan consumers' brains and program them to buy more. [Laughter] I'm trying to take a stand in the middle and show what's possible so that we can start the discussion around ethics. The conclusions are very simple and good for the consumer because we cannot plant a "Buy" button in consumers' brains. Thank God for that. I wrote the book to the consumer because I want to make sure that everyone is aware of what really goes on behind the scenes right now in companies. Consumers should be involved in the debate about how far things should go.

You begin the book by discussing subliminal ads, which created some hubbub back in the '50s and '60s. Why did you start there?

ML: There are many reasons why I find it intriguing. I read The Hidden Persuaders by Vance Packard when I was a kid.

No one has ever proven that subliminal advertising works until now. Finally, we have a research technique that enables us to show that it works and is, indeed, incredibly powerful. Not only that, it takes place every day.

You expose a famous example of subliminal advertising—movie theaters flashing an image of "drink more soda" or "buy more popcorn" so quickly that you didn't actually see it, but your subconscious was registering it—as a hoax. You acknowledge that subliminal ads exist, however. And you posit that, in a way, much of life has become subliminal. There's so much going on that isn't really registering in our conscious mind but is registering in our subconscious on a daily basis.

ML: Yes. What I find so interesting is that direct messages are not as powerful as indirect messages. We did an experiment, which I think you will enjoy—which was not included in the book. We placed two fake billboards in Los Angeles on one of the most high-traffic roads. The first showed a cowboy enjoying his life on a ranch without a cigarette. The second had an illustration somewhat similar to the first one. The only difference was that it had a logo next to it, and a slogan from a very famous tobacco company. Guess what? As people were passing by, the billboard without the logo had double the effect as the one with the logo in terms of generating craving in consumers' brains.

We learned that today the use of a logo can have a reverse effect. It's pushing the message too hard. It's saying to consumers, "Hey, buy me, buy me!" The consumer's first response is, "I don't want to buy from them." But at a subconscious level, the consumer is affected by the message without the logo and suddenly feels, "Hey, I want to have a cigarette now." It actually convinces the consumer that they're making up their own mind and that they should follow their instinct. It doesn't feel as though a message has been planted in their head.

We have to have been familiar with the product beforehand, right?

ML: Yes, you need to have had a bridge built. The bridge can be built in different ways. It takes two or more years to establish a bridge.

I want to say one thing. I'm not a huge fan of subliminal advertising and I don't support it. But I am a fan of telling brands that brand building is not about the logo—it's about everything around the logo. Sending indirect messages is more effective. Tell a story without showing the logo.

Companies have to start a process where they craft their advertising so that at the end of a two-year period, they don't have to put their logo in the ads. The signals they send should be so powerful that the brand is obvious—the color, the shape, the picture format, the style, the tone of voice, etc.

Companies that do this are incredibly successful. Take the Apple iPod. There's no logo on the front of an iPod, but you still know it's the iPod.

I've never thought about that.

ML: Of course not. Look at the cartoon movie WALL-E. Did you see it?

I haven't seen it, although it sounds like it's pretty funny.

ML: It is. What's interesting about this movie is the design of one of the robots. It's formed like a silver egg. The design of the robot invokes an iPod. It never says Apple anywhere, but it's actually an indirect product placement from Apple.

It's such a powerful way of sending a message instead of showing a logo all the time. We know from our product placement research that product placement with logos doesn't really work. What works is when you send indirect messages, because people feel like they're making up their own minds.

I find it more intriguing, more powerful, when we put the story together ourselves. Is that part of this?

ML: Definitely. Part one, there's no logo, but there are indirect signals. I start to guess who is behind the ad or placement, so I'm involved with the brand. Just the fact that I'm guessing is enough for me to remember it, right?

Part two, if it fits into a storyline and the brand becomes the hero during the process, that's even better. When the brand's not a hero, it becomes wallpaper. If the brand does not fit into the storyline, it's in the background, and we know from our study that the brand will be deleted from your long-term memory. Our brains are built in such a way that we cannot cope with all the information we're receiving. Information is being deleted constantly. If a brand doesn't help to complete the storyline, then the brain chooses to delete it so that it can concentrate on understanding the story instead.

We saw this in the American Idol test we did. People actually had less of a recollection of a brand after the event than they had before.

Tell us more about your research concerning American Idol, Coca-Cola, and Ford.

ML: I wanted to test if product placement works. It does. But about 99 percent of product placement and sponsorship today does not work, and it's an absolute waste of money. Why? It becomes wallpaper. Coca-Cola was successful with American Idol because they invented the Red Room. The Red Room is a Coke-branded green room. It's the place where contestants sit and relax before going on stage. It makes sense. They're relaxing with Coke in their hands. My brain is saying, "Okay, that's part of a storyline, it makes sense."

AT&T's sponsorship of American Idol, which was Cingular when we did the study, made sense because you have to use a phone to cast your vote. It makes sense to your brain, so your brain will remember it.

When it comes to Ford—let me be frank here—what the heck does a car have to do with a singing contest? [Laughter] Seriously. It doesn't help me understand the storyline and it doesn't help the singers win. So what will my brain do? Delete it.

Ford is not alone; right now, 99 percent of all brands are doing exactly what Ford has done.

Ford and Coca-Cola each spent 26 million dollars to advertise on American Idol. You're saying that Ford basically threw that money out the window?

ML: Yes. This is not to say that American Idol is a bad place to advertise. Ford has the best real estate in town. Don't waste it. Change the entire concept. Integrate it into the storyline so it makes sense. Get some clever people to brainstorm how to do that.

I don't think they've tried that in the coming season that begins in January.

Obviously they haven't contacted you.

ML: They haven't contacted me, but they're certainly very aware of this study. At this stage, if I were Ford, I would look at those neuroscience numbers, and I would take the study seriously. Even though you may be critical towards what neuroscience can conclude today—you shouldn't be, because we can prove it with science—you still have to admit that a Ford car has nothing to do with a singing contest. They have to find a justification for it, no matter what. That's what I'd work hard on if I were at Ford.

You have a wonderful anecdote in your acknowledgements about taking the Sydney Harbor Bridge tour. The tour guides are subjected to four months of training. Could you describe what happens in the third month of training?

ML: What's amazing about this whole tour is that it's not just a beautiful view. The tour guides have gone through a very extensive training process. In the third and fourth months, instead of learning about the Sydney Harbor Bridge, they are given research tools so they can create their own story. They go out and interview the people painting the bridge and the families whose granddads built the bridge. After a two-month period, they all have created their own stories. Those are the stories they're using as they're showing people around on the bridge.

Adam, who was my tour guide, created an unforgettable presentation. I asked him, "How the heck can you be that engaged? You've shown this bloody bridge 350 times." And he said to me, "Because it's my own story." That is what it comes down to.

Brands have an enormous problem when they pre-package a very controlled story. No one can own it. I think that's the reason why companies today are increasingly losing passion, because the founder is not around and no one owns that story anymore.

My message from the Sydney Harbor Bridge story is "Give the brand to the consumer." Make the consumer become the owner of the brand. Let them spread the word of mouth. Let them develop new products. Let them develop the communication package and spread it around the world. And then it will be a success.

One of the reasons why Apple, Harley-Davidson, and Hello Kitty are such successes is that they're driven by incredibly strong communities that own their stories. They spread the stories.

I spoke to two gentlemen in Israel recently. They'll be releasing a movie in the U.S. soon, called MacHEADS, inspired by my previous book, BRAND sense. They told me, "The secret of Apple's success is that they have four core communities out there. The communities are very small groups of people who are passionate about the brand; they live and breathe the brand. If those four groups were removed, the entire brand would fall apart." To me, that indicates that brands are not all about a logo and beautiful graphic design; brands are about having a heart beating somewhere. That's exactly what I learned from Adam and my Sydney Harbor experience.

I spoke with Guy Kawasaki about his new book, Reality Check, which is a wonderful compilation of his entrepreneurship knowledge. Getting his former position as the Mac evangelist was a fluke, but he was passionate about the brand.

The people running the Sydney Harbor Bridge have turned their guides into, essentially, brand evangelists. They've had to create the story themselves, so it's much more powerful for them. We all know that somebody telling a real story that they've created or are a part of is much more powerful than somebody giving you canned statistics.

ML: That's true. I asked people leaving the 2000 Sydney Olympics who were going back to the U.S., "What do you remember about being here?" Everyone had their own little story. One gentleman said to me, "One day I was lost. So I asked a policeman how to find my way around. He said, 'Hang on a second.' He lifted his police hat, and pulled out a tourist map he kept under it. He gave it to me and pointed out where I wanted to go. I asked him if that was standard procedure. He said, 'Oh, that's just my own little idea.' I will never forget it."

During the 2008 Olympics in China, you would have never discovered that type of story because everything was so programmed, and no one really owned it. It was a very well-programmed machine, but there was no soul in it. You could say the Sydney Olympics was similar to the Apple brand, and the Beijing Olympics was very much like the Microsoft brand.

Microsoft has an amazing distribution strategy, which has made them as powerful as they are. Yet, when we do research studies, no one is prepared to put a Microsoft tattoo on their arm, whereas 6.6 percent are prepared to put an Apple tattoo on their arm.

Is that right? [Laughter]

ML: That's true. It puts things in perspective. Guess what? Most companies around the world are in the Microsoft category. They've become a well-oiled machine, but there's no passion, no soul.

It comes down to control, right? In a large company, somebody has to maintain control. Whereas it seems that at Apple—it must come from Steve Jobs—things are run more loosely.

ML: The Apple brand is incredibly controlled behind the scenes. But Jobs has managed to at least make people feel that they can change things. Apple engages with their fan communities. There are rumors that Steve Jobs and his staff lost contact with the core community some years ago when the brand became too broad. Suddenly, everyone owned an Apple product. When these small fan communities weren't little unique groups with a passion about a really unique brand anymore, they lost faith in the brand. They missed being unique. Apple revitalized those communities.

By the way, exactly the same thing happened with LEGO, the toy manufacturer. They lost contact with their fan communities for a while, but they've revitalized them. Basically, that's the reason why the brand is so successful today.

I think brands are realizing the magic is not in the logo, the ad, or the television commercial; the magic is in those communities and their passion.

Although the Apple ads on TV right now, the PC guy versus the Mac guy, seem to be quite popular.

ML: They are popular because they have one objective, they are defining who the brand is not. There's a strong correlation between brands and religion. We scanned the brains of religious people to understand the areas in the brain that are activated. The same areas are activated if you are very passionate about a brand.

I traveled around the world, interviewing religious leaders. We examined ten ingredients that are the pillars of creating power for religions. It's a roadmap for the brands of tomorrow. One ingredient is to define your enemy. That's exactly what Apple is doing. They're saying, we're Mac and you're PC.

Pepsi did that for a while with Coke versus Pepsi. When I spoke to Pepsi executives some time ago, I said to them, "Where's your enemy picture? You haven't really maintained that picture, have you? If you ask 14- or 15-year-old kids today, 'Who's the main competitor to Coke?' they have no idea. They're not going to say, 'Pepsi,' because that's an enemy picture you've failed to maintain."

Pepsi took it for granted. Companies should not take things like that for granted. The enemy picture is incredibly powerful. That's the reason why religion and sports are so powerful, because they have a defined enemy.

It appears from your coverage of religion in the book that religions have been very good at branding themselves, if inadvertently.

ML: That's not really my conclusion. My conclusion in the book is that religion has been around for two, three, or four thousand years, and that's not a coincidence. To be frank, religion is one big story. It has amazing stories, passed on from generation to generation. The reason you and I know about it today is because of stories.

When we do neuroscience research on storytelling, we know for a fact that if I have ten numbers I would like you to remember tomorrow, and I either tell those numbers to you repeatedly for five minutes or I tell you a story around those numbers, you will remember the numbers from the story with 50 percent more accuracy. We are hard-wired to be seduced by stories.

The ingredients that make religion as powerful as it is today—having an enemy defined, sensory appeal, rituals, symbols, communities, evangelism—are the same elements that make brands powerful. They all activate the same region in the brain, for religion or brands.

Brands like Harley-Davidson, Apple, Guinness Beer, and the Olympics, all utilize at least nine out of ten of the ingredients that create power for religion or brands. Using those ten ingredients is the roadmap for how to build the brands of tomorrow.

You suggest in the book that perhaps if the producers of the Segway had done some neuromarketing research, and found out what people actually felt about the Segway rather than listening to what they said their opinion was, that they might never have produced it.

ML: That's true. I think the best evidence to support my claim is the experiment with the Quizmania TV show. It's a terrible quiz show. It's like Wheel of Fortune on speed. No one really liked it when they were asked if they did. Guess what? When we scanned their brains, they loved it. Guess what? When it was aired around the world, the brain scan prediction was 100 percent correct.

If we had followed quantitative and quality research techniques, that program would not exist today. But it does exist and it's successful. What I find fascinating is that, in research, quite often we say one thing and mean something else. It's not because we're lying, it is simply because we can't express certain things. Too much is driven by the subconscious mind. But almost all brands have created an entire foundation around assuming that what people say is correct.

Almost every time we did a research study for Buyology, people said one thing, and we learned that what they said was totally different from what was happening in their subconscious mind. With the Segway, I'm pretty sure if you were to do a neuroscience-based study, you would find that the concept in principle makes sense, but people would never really buy it. It's one thing to say, "I would stand on that thing." It's another thing entirely to say, "I will stand on that thing after paying five thousand dollars for it." People are simply not prepared to do that. There are other, less practical factors like, "Do I look stupid on one?" But when it comes down to it, sometimes the less practical factors drive whether people purchase and use something.

A parallel example is the Corona beer ritual where you squeeze a lime and put it down the bottleneck. When Corona was developing a new brand called "The Corona beer with lime taste in it," people never bought it. They didn't like the taste. But it's exactly the same taste as if you squeeze a lime and put it down the bottleneck. [Laughter] So there's no logic to this, right? If you did research studies, everyone would say, "Of course, develop a lime-flavored beer." But it never sold because our subconscious mind misses the ritual. The ritual becomes part of a story.

I find pushing the wedge of lime in problematic. It doesn't fit, it spills, and it can be hard to drink.

ML: It's human nature. It's like knocking on wood. Why the heck do we do that? I met a CEO from one of the largest corporations the other day. He tried to justify knocking on a plastic bottle in substitute of wood. [Laughter] He has a staff of 1.7 million people. This guy was actually arguing against me that people were very rational and we should be using quantitative and quality research techniques. I said to him, "And you just knocked on a plastic bottle."

That is where we are as human beings. The more we're under stress in our society, the more irrational and superstitious we become. This makes us more vulnerable to seduction by emotional, subconscious things than anything else in our lives. No research technique until now has been able to understand this. That's why I believe my research is going to change our view of how to build brands and research brands in the future.

And it's a warning to us as consumers to beware.

ML: Definitely. Neuromarketing is relatively new. If no one monitors the industry, companies may get carried away with it. It could become a monster over which no one will have control if no one pays attention, and it could become too late for the consumer to have a say.

Now the consumer can read Buyology and can begin the debate of whether what's happening is too much. Will it be too much if politics uses neuroscience in the future? Are new brands using it too much already? Now is the time for people to speak up if they think it's too much. If people feel comfortable about it, fine. But this will not stop.

With the recent presidential election, I think Democrats were fearful that, despite the fact that people were saying that they were going to vote for Obama, perhaps they'd get into the booth and say, "Well, no, I can't actually vote for a black man."

ML: Exactly.

You're saying if you had taken 500 people, strapped the neurosensors on, and asked them who they were going to vote for, you'd get a more reliable view of how the election would go?

ML: I'm pretty convinced that's true. I'm not saying that neuroscience and neuromonitoring would replace quantitative and quality research techniques. I think we will see this in addition to them. It will tell us what's going on, but it won't tell us why. Still, it's an interesting insight that we haven't had before.

I predict that by 2012, neuromonitoring will play a major role in the polling phase of research when it comes to the election. We will start to see that many of the predictions coming out of ACNielsen or Gallup will be based on neuroscience, rather than just asking people questions. Politics is such an emotional thing. It's driven by the opinions of those around us as well. The subconscious mind has an enormous influence.

The best evidence is a recent study which showed that when people were voting in churches, they were more inclined to vote for the Republicans. Why? Republicans are against abortions. It's hard to be pro-abortion if you're standing in a church, right? At the subconscious level, you are more inclined to vote for a certain party depending on what's happening around you. Those studies, for me, indicate that there are many signals around us that we have never taken into account using qualitative and quality research techniques.

Excellent. Martin, I want to thank you for your time.

Contact: jonasson (at) – martinlindstrom (dot) com

Website: www.martinlindstrom.com