EP 77: How Emotion Dictates Our Behavior, with Kevin Perlmutter

On this episode of THRIVE—sponsored by Workamajig—Kelly and Kevin Perlmutter discuss how emotion dictates behavior in the new now, the neuroscience behind it all, and how brands need to shift in order to speak to the rapidly changing emotional states of being.

Episode 77 Links

Limbic Brand Evolution: limbicbrandevolution.com
iTunes / Apple Podcasts: itunes.apple.com/us/podcast/thrive-the-agency-scaler-podcast/id1370205729
YouTube Channel: youtube.com/channel/UCboltXvff1KfeCHpQbY_8PA/
Vimeo Channel: vimeo.com/agencyscaler

TRANSCRIPT

 EP 77: How Emotions Dictates Our Behavior

Duration: 23:56

Kelly: Welcome to this week’s episode of Thrive, your agency resource. I’m joined today by Kevin Perlmutter, founder and chief strategist of Limbic Brand Evolution, the consultancy helping brands increase desire, engagement, and loyalty with a distinct focus on emotion. And that’s actually what we’re going to be diving into today. How does emotion dictate our behavior? And what are brands and creative agency leaders need to know, as we sort of enter the new now or are in the midst of the new now. So Kevin, thank you so much for joining me on the show today.

Kevin: Thank you so much for having me.

Kelly: So I do always like to start, especially with agency leaders, and I know that you’ve had some in house brand experience as well. What is the origin story of Limbic and why did you feel the need to go out on your own and create this consultancy? 

Kevin: Yeah, I started Limbic in early 2019. And it was after many, many years of working in the business for other agencies. I spent the first 16 years of my career working at ad agencies. And then for 7 years, I was a Senior Brand Strategy Leader and Client Relationship Leader at Interbrand, which is a global brand consultancy. And there I became a full on brand strategy leader for the clients that I was working with. I actually had an incredible opportunity to launch their first ever customer experience practice.

Back in 2008 or 2009, I created the infrastructure for that practice, train strategists in multiple offices around the network, spoke at a conference or two. And it was just an incredibly influential time for me in my career growth because I was really starting to think about the customer perspective, having come from advertising. This was really important to me at that time, and becoming really important in marketing and branding. I did a lot of other things there. But then in 2014, I had the opportunity to join a music studio that focuses on Sonic Branding, and my job there was Chief Strategist and Chief Innovation Officer.

And the role that I played there was one as an internal business architect to help the company evolve, to help think about offering expansion to help deepen the strategy capabilities and the innovation, ways of working for that company and for its clients. But more importantly, for me, the bigger takeaway was a deep understanding of behavioral science, and learning how to think about brand strategy and brand experience through the lens of emotion and how you want people to feel. One of the capabilities that I created there was a neuroscience based research capability. And I did that in partnership with an outside research agency. We customized it to be an exclusive capability of this music studio. And I really learned a lot about neuroscience based research, how emotion impacts behavior, and lots of other things that we’ll get into details as we go.

Kevin: Yeah, for sure. So, yeah, so let’s just talk about that. How does emotion dictate our behavior in what you’re sort of calling or terming, the “new now”? How does that work? And like just from a 101 standpoint?

Kelly: Yeah, well, when I decided to form Limbic and bring all of these things together, I felt that there was a really distinct opportunity to think about emotion, and apply emotion to how brand leaders and CMOs strengthen relationships with their customers. This is something that is often talked about, and it’s something that most friend leaders, most CMOS don’t really give a lot of credence to. So one of the things that I think about quite a bit is the power that emotion has on people’s decisions. So 95% of the decisions we make are subconscious and instinctive, only about 5% give or take depending on a situation are rational decisions. We’re constantly making these instinctive decisions all day long.

And it’s guided by our feelings. The name of my company is Limbic Brand Evolution. And that comes from the limbic system, part of our brain, which guides emotion, motivation, behavior, and memory. So all the time when I’m thinking about how to work with clients, and how to bring emotion based techniques into the relationships, I’m thinking about how is it going to make people feel, and using that as a lens for the different ways that I guide them forward. So another statistic that’s really important is that when people are emotionally connected to a brand or an experience, they’re 50% 53% more valuable than people who are just highly satisfied. So it really has tremendous impact on the way people behave. And sort of the value that they bring to a company as a customer. So I might not have answered your question exactly.

Kelly: What do you mean by 53% more valuable? You mean in terms of like monetarily as a lifetime?

Kevin: Yes, that’s exactly what I mean, because they are more eager to buy your products. They’re more interested in talking about them positively. And I carry that experience with other people. They’ll go deeper into your product line. They’ll be willing to try new things. They’ll be more forgiving if they have a bad experience once in a while. On the flip side, 47% of customers according to the CMO Council, 47% of customers will abandon a brand experience if it’s frustrating and personal, or they’re just having a really bad experience, if they have not developed that loyalty to that brand. Definitely, I’m sure the statistic is higher for those who have not developed the loyalty because on the other side, it’s gonna be a lot lower for those who are more forgiving.

Kelly: Right. So let’s talk a little bit about the neuroscience behind it all because I think that that’s probably the most interesting part. I mean, we all know, because even all of those CMOS and all of the people watching who are creative leaders, or listening are creative leaders, we ourselves are consumers. So we know that what you’re saying is true. We know that our emotions guide our purchasing decisions and our behaviors in general in the world. But I think the neuroscience aspect of it is the most interesting and I think that gives a lot of credence to just as human beings, being sort of detectives, like wanting to know why do I do this? So neuroscience really helps to explain that.

Kevin: Yeah. So there are a few different things going on in neuroscience that actually do explain why emotion is so powerful. One of them has to do with the difference between intrinsic and extrinsic motivation, and there’s a great book that was written many years ago called Drive. And that book really explains this theory really well. And there are many others out there. But basically, what this book calls motivation 2.0 is really rooted in extrinsic motivation. And that’s like give and get scenarios that if you do this, you’ll get that and there’s all sorts of information about customer relationships and employee to employer relationships, where extrinsic motivation and almost bribing people with a reward for doing something well, has a limited life span.

But when people are motivated intrinsically, it’s based on something that they really desire, based on something that they really feel, something that motivates them to actually get up in the morning and do things. So as it relates to brands as one scenario, if brands are doing things to make people’s lives better, which I believe is the appropriate calling for any brands in the world today, is to make people’s lives better. If brands are really doing that, and communicating what they’re up to in a way that gets people excited, that draws them into the experience, that makes them feel that emotionally, this is going to be something that they want to be a part of, associated with, that it’s going to solve some unmet need or even unarticulated need in their lifestyle, that they’re going to be drawn to that brand more deeply.

So intrinsic motivation is a huge piece. There are also things that happened to our emotions around cognitive biases. So we’re walking around with cognitive biases all day long. And there are many very effective cognitive biases that can be applied to marketing and are successfully applied to marketing everyday by smart marketers, to help people make decisions in your favor. And I don’t believe for a second that any of that is manipulative. Anyway, it’s really tapping into the neuroscience of how brains work. And it’s helping to guide people towards decisions that you would hope that they would make in favor for brands. Because it means something to them. But you can offer things up like the scarcity effect, when something is out of stock soon, when there’s only a few that are available for sale, that’s going to cause people to feel a little bit more compelled to maybe take advantage of it sooner if it’s something they’re interested in. If there are choices that people need to make between different options, there are lots of different cognitive biases that we have that inform those choices.

So for instance, the ambiguity effect means that if there’s too many choices, people just are unable to make their decision. But if you know there’s another one out there called the decoy effect, which this familiar example for the decoy effect is like as old as a wine list in a restaurant. There are certain wines that are on the book ends of the spectrum of that list that they know most people aren’t going to buy. Most people aren’t going to buy the most expensive wines. And very few people are going to be with guests and friends with the restaurants and buy the cheapest bottle of wine. But they’ll typically buy something else within a range that’s in between the two. And those are choices that marketers could make to help address how people think and how they make decisions.

Kelly: Yeah, I think about that in terms of like SAS platforms as well when you can subscribe on a monthly basis or an annual basis for some SAS platform and you have sort of like the good, better, best, the good options, but entry level option typically has very few bells and whistles, if any; maybe there’s like a free and then good, better, best. You might do the free version just as a trial. But once you jump up, most people jump up to the better option because they like sitting in the middle. So yeah.

Kevin: Yeah, it definitely helps to draw people in. But depriving them of a few things along the way is going to help them move forward. But when I think about the neuroscience of this, I want to make it clear. I’m not primarily focusing strategy on cognitive biases that sound like they’re manipulative. If you’re listening in the wrong direction. What I’m really thinking about is what’s going to motivate people, what’s going to help people make decisions in your favor, because they fully believe that what you do out there is most important. So when I’m working with clients, in addition to helping to think about the consumer motivations and how to link with consumers in a way that addresses their need, I’m also incredibly interested in thinking about what motivates the brand leader or the company leader, thinking about what it is that they feel is the most important thing they could be doing to help others is super important to my process.

And another area of neuroscience that I bring into it has been to do with the parasympathetic nervous system and the sympathetic nervous system. And the difference between the two is that the sympathetic nervous system is really about fight or flight. It’s really about asking questions that make people concerned and nervous and kind of put their guard up. So a technique that we all use with our clients with executive interviews, helping to understand what makes them tick. And I’m really leaning into questions that tap into the parasympathetic nervous system, when I’m asking interview questions. I want to understand from a client when their business is working in the way it should, what is their best day? What are they most excited about, that they do for the customers that they want to serve? What is it that they wish people knew about their organization that they fear some people don’t and would give them a better impression of the reality of what the organization’s purpose in the world is. So I bring neuroscience into the work that I do because it taps into the way people actually make a lot of decisions; the way it dictates their behavior.

Kelly: Right. And so the natural question for me after that is, how does all of that translate into branding? And then how do brands need to shift in order to speak to this rapidly changing emotional state of being that consumers are faced with at this moment in time? Which is different from anything that we’ve seen in history.

Kevin: It’s such a great question, and it’s the question that I’ve been dealing with for the last several months while all these have been going on in the world. And as a brand consultancy leader who prides himself on having, I think it’s distinct and important approach to the way I serve my clients. I keep trying to think how it can become more distinct or what’s most relevant in the work that I’m doing right now. I actually started this business with a belief that a focus on emotion, in how you want people to feel is the most important thing that marketers should be thinking of. And in the last few months, it’s become clear to me that that is even more important than it ever has been before. I think it’s super important to understand your customers. So first and foremost, understanding what makes your customers tick, what’s driving their decisions and their behaviors is a lifelong pursuit of any marketer.

But right now, there have been so many shifts and changes in the way people are feeling and the way people are behaving and what they have access to and what they’re afraid of. So people right now are looking for greater security. They’re looking for more normalcy. They’re looking for emotional releases from the stresses that they’re dealing with. These are all things that brand leaders can tap into if they understand them. But on the flip side, they’re looking for things like contactless payments, contactless interactions with brands. They’re looking for more healthy alternatives. They’re looking to be more value conscious. There are some industries that are going to change dramatically forever moving forward, health and wellness and the tremendous increase in virtual health care is going to continue.

The doors are open. And as a great marketer, a friend of mine once said, “You can’t put the toothpaste back in the tube.” I mean, these things are out and they’re going to happen and they’re going to continue and people are enjoying them. So the things that marketers should be thinking about right now is in the new now, as all of this is changing on a daily basis. You need to stay in touch with what’s going on in your customers minds. What’s changed for them recently, that could impact not only how they might no longer need or desire, what you’ve been offering in the past. But what is it that you do in the world that you can actually bring into their lives that will make their lives better? That’s what you should be thinking about.  How can you adapt your services to suit the needs that they have right now?

Kelly: And thinking about those things is super important. Right? But how do you recommend getting the data from the consumers themselves? How do you recommend like, either serving or what are the ways in which you think are the most impactful in order to get the most honest answers from the consumers that these brands are essentially trying to serve?

Kevin: It’s such a great question. And it’s just the question is, how much does a car cost? It’s that age old question where there are so many ways to approach it, from a limited budget to a large budget. So if you have a limited budget or you’re a small business owner. be observant, talk to your customers, understand what’s changed in their lives. Look at research. Do a Google search on brands in your industry and how they’ve adapted to serve the customers in their local markets. Look at consumer trends and what’s changed. If you look online, there’s so much information you could find right now that robust research may not be necessary. You can send out surveys to your customer base to understand what they need most now and what things you can do to better serve them.

You can just talk with people. That’s super important. But on the flip side, there are incredible research capabilities out there. When I have the opportunity, I like to use cognitive and behavioral science based research capabilities that truly understand what needs people have, what their fears are at a subconscious level. There are studies you can do rather inexpensively that allow you to tap into the subconscious, and then even understand how that subconscious reaction affects conscious behavior choices. So there’s an incredibly high correlation between how somebody feels, and then how they act. And sometimes research spends a little bit too much time, a lot of traditional research spends a little bit too much time asking people how they will act. But it’s not wholly accurate, right? Because you’re not tapping into how they feel. And they’re getting back to cognitive biases or stated bias. The way people describe what they’re going to do sometimes isn’t the reality of their instinctive reaction. So I like to use research techniques that combine the two when I have the opportunity.

Kelly: What I’m curious about and this is a little bit of a curveball, but what I’m curious about is, so right now, if we’re talking about emotion, when we’re talking about either surveying or talking to people or whatever the methodology you’re using, there are a lot of people, let’s be honest about it, maybe myself included. Some days that we don’t know how we’re feeling from on a day to day basis. I mean, sometimes my emotions can change hour by hour. And maybe you don’t have the answer for this, but I’m assuming that you could at least lead us in the right direction. How do we account for the fact that people are either overwhelmed? They’re feeling so many things, or they’re actually pretty numb, and don’t necessarily know how they’re feeling? How do you get the information that you need as a brand in a situation like we’re in right now?

Kevin: Well, it’s such an important question. It’s such a great question. And, like everyone else out there, I’m feeling it too just that time when things change on a moment to moment basis, because of all that we’re dealing with right now. And I think that the answer to the question relies on flipping. Flipping the perspective a little bit. So you asked a great question about how do we tap into consumers. How do we do research? How do we understand what they’re feeling? But we’re all humans. We’re all consumers. And as a marketer, the most basic thing you can do, just focus on how you want people to feel. Think about how you want people to feel, think about what is in your arsenal, what is in your product line, what can your brand do in the world right now to help people feel better? What is it that you do that makes your brand special, your business special? And how can you put that out there in a way that makes people feel better? I really think that that’s the most important thing you can do with or without consumer research. You can probably figure out some good answers.

Kelly: Do you find that some of those answers are really just doing a lot of maybe North star vision, mission, purpose statements, things along those lines? I mean, even though those change, like we know that those change over the course of time, but do you think that some of those answers are embedded in doing some of that work with what you said before, part of the beginning of your engagements is to talk with the executives.

Kevin: Yeah.

Kelly: I would imagine that some of that probably comes up in those conversations.

Kevin: It definitely does. I mean, brands are never going to be static. They’re going to start a brand. Any brand, any business started because a leader felt that there was something important that they can do in the world to make people’s lives better. Let’s give the benefit of the doubt that that’s how these brands and businesses started. Sometimes they get a little off course. Sometimes the world around them changes, the dynamics change. And what I like to do when I’m entering a relationship with a client is help them focus. I like to help them focus on what makes them unique and desirable. What is it that they are in the world do for people to make their lives better? And then how can we start to express that in ways that give them that guiding light.

And then when we think about the flip side, which is the questions we already talked about, related to what the consumer is feeling and what the consumer needs, I like to create that intersection. I said the name of my business is Limbic Brain Evolution. Limbic is that part of the brain that controls emotion, motivation, behavior, and memory. And my objective when working with clients is to create what I call limbic sparks, and limbic sparks happen when your audience is emotionally motivated by what you’re all about. So everything I’m doing when working with clients is looking at those two sides.

What is this brand all about? What is their purpose? What is their guiding light? How can we bring that out in a way that is meant to help people? And on the flip side, what is it that the consumers, the audiences they want to reach need, want, desire could use right now, whatever the right question is, and then how do we connect the two? How do we find ways for that intersection to happen, because we’re talking here about how emotion dictates behavior. And if you’re creating limbic sparks, you’re tapping into emotions that people have and your driving behavior.

Kelly: Really, really good stuff. I love this conversation. Kevin, thank you. Thank you so much for joining me. I really appreciate your time. And best of luck with everything.

Kevin: Thank you so much for having me on the show.