Order Neil Peterson's
Embracing the Edge
on Amazon today.

Or buy it at the Edge Foundation. All profits from the sale of the book go to support the mission of the Edge Foundation.

View Neil's latest traveling blogs





Neil Peterson is an affiliate member of the National Speakers Association and frequently speaks to organizations on a variety of topics. Learn more

You may contact Neil about speaking engagements at:
(206) 910-7515

It is the question with a multi-billion dollar answer. Forget the X prize – the expanding field of neuroeconomics is where the money’s at – literally. Our wholesale embrace of capitalism has meant, among other things, that businesses are willing to shell out big bucks to get you to buy their products. This is advertising. Sometimes advertising hits the nail on the head – witness Apple, Coca Cola, Ford. These brands deliver a good product, but you know about the product because of the serious/creative action taking place behind-the-scenes. That advertising is a worthy investment should go without saying, but what if you could make that advertising even more effective?

The new science of neuroeconomics might be the answer. Economists have long been stymied about why we – as (mostly) sentient beings – continue to make decisions regarding our financial choices that are more often based on seemingly irrational or misguided information. Asked a series of questions about our purchases, we are more likely than not to give reasons that make little to no sense. For fans of logic, this is a nightmare. Psychologists have been stymied by this same dilemma. There has just been no feasible way to view the ‘brain on decision making’.

Until now. Brain imaging scans have long been at use in the medical field, mostly in regards to diagnoses and disease-prevention. The technology isn’t new, although scientists are learning improved methods for reading the results, but has only recently been applied to viewing active areas in the brain in response to specific stimuli. By watching the brain in response to targeted questions regarding financial decisions – stock trading, consumer actions, choosing one mortgage over another – scientists are learning much more about the things that make us say ‘Yes.’ And for anyone who has spent money on a creative campaign, only to see no return on investment, this could be big business.

Neuroeconomics is a branch of social neuroscience, the study of how our biology affects our social behavior, and how to use that knowledge to refine previous theories of how we interact with the world around us. These advancements are especially exciting when considering that as much as we know about our anatomy, the brain is still largely akin to the ocean – vastly complex and riddled with deep areas we know nothing about.

These imaging scans are able to show us – in graphic, anatomical detail – which areas in the brain respond to messaging and have been proven to predict consumer decisions. Pleasing imagery, brand familiarity and inspiring ad content can active the pleasure centers of the brain, urging us to buy the product and fill the now-apparent void. However, high price points have been shown to stimulate the insula, an area associated with painful stimuli. In addition, mistargeted messaging can also affect the regions of the brain connected to disappointment – especially if said product does not deliver as promised. It’s not you making the decisions, it’s your anatomy.

While this new field is promising for advertising, it is also a boon for economics and our own bank accounts. For example, scientists have shown that when given expert advice, certain regions of our brains show little to no action. Meaning that if Warren Buffet tells you to do something, you stop thinking for yourself. By acknowledging this biological treachery, you are able to take back control and make the decision based on sound, rational information (even if it comes from the Oracle of Omaha.) Neuroeconomics is still a relatively unknown field of study, relegated to the ‘small offices’ of academe, but once it starts delivering quantifiable results, the sky is the limit.