You’re not paying enough for your coffee. That’s according to Kai-Markus Müller, a German neuroscientist who has developed a way to measure brainwaves and hit upon feel-good prices. Judging by neuroimages, he told Spiegel International, Germans would happily pay $3.25 for a small cup of Starbucks coffee, 33 percent more than the current price tag of $2.44. If he’s right, Starbucks is missing out on a whole lot of profit.
Müller previously worked for the consulting firm Simon-Kucher & Partners, helping companies determine optimal pricing for their products. But, he says, “classic market research doesn’t work correctly.” Research subjects can’t always be trusted to honestly state how much they’d be willing to pay for something, he says.
Neurological scans are harder to fool. In our brains, there is a region that monitors proportionality. When proportions are drastically off—for example, when a cup of coffee costs ten cents or $100—this region sets off an alarm. “When the brain was expected to process unexpected and disproportionate prices, feelings of shock, doubt and astonishment manifested themselves,” Müller told Spiegel.
In Müller’s Starbucks study, an undisclosed number of subjects were shown several images of the same cup of coffee, each paired with a different price tag. Subjects’ brainwaves were being recorded via electroencephalography, or EEG, and indicated when the price was right.
In a follow-up experiment, Müller teamed up with scientists at Munich University of Applied Sciences and installed a caffeine vending machine that dispensed coffee for 70 cents, cappuccinos for 80 cents, and then left students to their own devices to pick an appropriate price for macchiatos. After several weeks, the macchiato price leveled off at 95 cents, according to Spiegel. When Müller performed his neuropricing lab experiment, he found that subjects’ brainwaves also indicated 95 cents as the ideal price for the vending-machine macchiato. An exact match.
These days scientists are developing all sorts of brainwave-based gadgets. There are headphones that supposedly use sensors to detect emotional state, then choose songs that fit the mood. There’s also Good Times, an app being developed to sense your state of concentration and block incoming calls when you’re deep in thought. And several big companies are already spending millions on neuromarketing.
Müller’s company, The Neuromarketing Labs, advertises not only NeuroPricing, but also NeuroBranding, NeuroPackaging, and more. The site does not list any clients, and it doesn’t include pricing for the various services—but, if all goes well, customers will pay no less than they deem reasonable.
