The Prospect’s Perception Gap: How to bridge the gap between the results we want and the results we have

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“Print your webpage and take a red pen through every declarative statement. See what you have left,” Flint McGlaughlin urged in his featured speaker session at MarketingSherpa Summit.

People challenged with a claim naturally resist it. But people who arrive at a conclusion will naturally defend it.

In this video replay of his session, McGlaughlin, Founder and Managing Director, MECLABS Institute (parent research organization of MarketingSherpa), shared the levers you can pull to help your customers arrive at the right conclusions about your brand.

McGlaughlin integrated case studies around value proposition and branding from almost 20 years of consumer behavior research to help attendees at every level in an organization. Business leaders will discover how to rethink ways they communicate their brand. Marketers will learn to transform the messaging of any piece of marketing collateral to, ultimately, improve results by replacing promises with expectations and claims with conclusions.

“Value is derived from a limited view of reality, and thus it is often appraised differently,” McGlaughlin said. “We presume value ... but we have to help them [customers] see it.”

You can watch the video replay of the session below. Or scroll down for a full transcript of this featured speaker session.

Change ‘data’ to ‘behavioral traces’ because calling it data dehumanizes it. — Flint McGlaughlin 

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TRANSCRIPT (slightly edited for clarity)

Flint McGlaughlin: If you've been to any of these summits in the past, in fact, how many of you have attended the summit before? Let me see your hands. Good. All right, and if you've heard me speak, today will be different from what we've done before. We're going to be engaging neuroscience and more cognitive psychology, and we're going to be talking about one of the most important challenges that you face. I'll say more in just a few moments, but could you please take a look at this page? Now. I want you just to do a couple things. The music is going to come up in a second. You need to work in teams of three. There's a reason for that; we test everything.  And you need to put down three to five changes you would make to this page. We're going to do it swiftly and then move to something else. All right, so, feel free to get up and move if you need to reach somebody. Feel free to talk and make noise, but let's get started right now. 

If I can have your attention back for a moment. What we've done together is we've raised a question that's caused you to start to develop some actions, but beneath the actions is a hypothesis. And we may not always recognize that it's a hypothesis, but when you have a reason for the change, you're forming a hypothesis and it could be explicit or implicit, but often when it's implicit, we haven't done the necessary science to shape it correctly. But before we have a hypothesis, we have to have some set of observations that guide how we're thinking. And, and to do that, we need to think more about the mind. You've heard me say for many years, it's not right, it's not the main task to optimize webpages; we optimize for the sequence of thought. So as you think about this page, I want to take you to a different place.

We're not going to do what you might have seen before when we've opened some of these events. Instead, I want you to keep your thoughts. In fact, I'll just do this. Um, I'm going to walk down here ... tell me one thing that you would change about the page right in here. Go ahead and I'll come right back to you. "Too many calls-to-action."  Yes sir. "If it's a landing page, remove the navigation and unnecessary friction." I'm not using Mike runners right now, so I can keep my speed up. But I'll say out what I hear. All right. Somebody else, what other changes would you make? Yes.   "The white text on the top is very hard to read." You're correct. Yes. "Make travel insurance more dominant." Yes. "The images don't fit the call-to-action."

All right, so where's the group from Sweden? I know you're in here somewhere. Wave your hands at me. There's a large group from Sweden, I think 10 to 20 people that came. So give me some insights from, from the other side of the world. What's one thing you would change? I can't hear it from here ... All right, so take a look. Keep your thoughts in mind. We're going to come back to this later, but for now I'm going to tell you that to get to the best answer, we need to go on a journey, and it's probably going to be a bit odd at first. I'll share with you some concepts, and I want you to see each of them and ask yourself, "How are these connected?" Because they are closely connected and indeed, the only way I know in the short time that I have to deliver to you the richest possible experience, something you can take away, is to sort of approach this very differently than you might think. Because we're focused right now on a challenge that's much greater than many of us realize.

We spoke last year about the marketer's blind spot. This year, we're inverting that conversation, and we're thinking about the challenge that we face inside of the prospect. And it is the prospect's perception gap that gives us the greatest challenge. So as you stare at the screen for a moment, I'll share with you the first object that we're going to look at later, and ask yourself what is the connection between these particular concepts?

So that's the first one. Take a look at that and say, how would that possibly connect to this?  You know, you have a Lego on the table in front of you. We're also going to provide a beetle for each person here too, just a little something extra we do for you. And, and then notice, uh, some would be relieved to see there's beer involved and a Lego.  And finally this. Now the truth is between each of these is a rich connection that can help us understand something about how the brain works, how the mind processes. And with those observations we can sort of put together a set of implications and applications. And indeed I will take you down that path. But first I'm going to ask you to do something very carefully. On the table in front of you is a Lego. You're going to want that Lego a little bit later. There is this image. It may be easier, you can use this, but it may be easier to use the card. You need to stare at that top dot for at least 30  seconds, 30 to 60 seconds. And then immediately stare at the bottom dot, and we're going to see how "normal" changes for you. So stare at the top. When you stare at the bottom some of you will notice a change. Can anybody tell me what the change is? Yes, yes. Say it out loud again. Yes. “The color changes.”

What's going on here? Because it's important that we realize what you see after staring at the dot based on the frame of reference you began with, it changes the way reality is perceived in the second set of illustrations — the dune, or the mountains. Indeed, if you think about this a little bit more — and Beau Lotto developed this. He's credited on the card — but it helps us understand how the thing we focus on first can change the way we see the second thing. And the implications from that are phenomenal. Indeed, I want to use that as the basis to open up new territory for us to discuss together, and we're going to move through six points beginning in observations, implications and applications. The observations are going to take us into a deeper understanding of the mind. And then we want to look at the implications for marketing. And then we want to ask how can we apply this tomorrow?

How could we use this to make a difference? And so you'll notice this image on the screen is the controlling image. I'll guide you through this entire session. And that will be our frame of reference, so you can understand where you're at in the spine of the delivery. Okay, let's start by focusing on the first point. You'll notice it just animated. This is critical, and marketers, we make this mistake over and over again. We underestimate the importance of what you see right now. Reality is not directly or fully apprehended. Sometimes we have this idea in our mind that our eyes are just a window into reality. They are not. Indeed, it is approximated in a perception process, and in that perception, your version of reality is reconstructed by what's happening inside of your mind.

Now you might say, well, how does that connect? Well, it connects to snakes and beetles and 300 percent improvements in your marketing performance let's unpack the first two points under Section one — Observations. And I'm going to stop that just a second. I want you to take your phone. If you've got a phone in front of you, I want to use it. I'm not asking you to silence your phones. I figured you know that. I want you to look at the camera on your phone because we're going to compare that for just a moment. So if you have your phone look at it. Do you know, how many of you know the megapixels on your phone? Who knows that number? Twenty-one. That's huge. That's better than my iPhone. Anybody else? What're the megapixels on your phone? So, you know, the average phone is about 12 megapixels. 16 over there.

All right. I want you to think about that powerful camera on your phone. I mean it's unbelievable how it reconstructs an image on a screen and digital bits. And as you think about your phone, I want you to think about this other camera. I'm going to talk about it for just a moment. Your eye is also working much like that camera. It is processing and it's processing with a hundred and 30 megapixels, and it's processing information that moves into your brain. Your brain is like a vault of silence and darkness. And it cannot see anything. But in your brain, one-third of the cerebral cortex is being used to try and understand and process, and really it's generalizing what's taking place. In the meantime, this amazing camera right here — not only is it a hundred and 30 megapixels but it's processing 2 billion pieces of information per second, not 2 million, 2 billion.

And as it does so, it's reconstructing reality. As we saw last year — this, this presentation is part of a trilogy that I've been planning over three years — the blind spot, if you didn't get it, someone can tell you where you can get it from last year and listen to it because it connects to this. We did an experiment with the eye last year, and in that what we noticed was that you don't really see everything that you think you see. Your eye takes in the light, and it's reconstructed. We found that there is a blind spot. Every human being has it at the optic nerve, at the connection point, and your mind, your brain fills it in. Now, hold to that thought and let me develop this just a bit further because, despite the fact that you're processing 2 billion pieces of information per second, you're barely touching. You're barely grasping what's really going on. Do you see that tiny spectrum on the screen? I want you to notice in just a moment that it represents the part your eye can see, and all the rest is the part your eye cannot see.

Indeed. We're only seeing a fraction of what's going on around us. We have this natural survival arrogance that makes us feel like we're directly perceiving, that what we see is right. Have you ever argued with a friend and swore, "I did not say that." And the other person says, "I heard you say that." Have you ever had that? You know, the more I've studied, the less I've been able to speak with such confidence because I have discovered that I don't know even for certain many of the things that feel like certainty.

That's scary to me. What's really going on around me? And if you get to the molecular level it gets even more frightening. But let's stop for that for a moment, and I just want you to pick up the Lego on the table in front of you. I'm going to borrow this one. I want you to appreciate these Legos because somebody ordered them on the plane on the way here, and it took $80 in a cab to pick up the box. And I sent my daughter who's here — Casey? Are you in the room? ... See that beautiful blonde in the back. Hold your hand up, Sweetheart. Hold it high. The only reason we're here today is because 30 years ago she [my wife] let me start a research lab. We were just married, just married, and we took a walk on the beach and I said, "There's this amazing opportunity."  I tried to explain what the internet was, but no one knew. No one had heard of it. It was in Unix. There were no websites. And I said to her that day, I said, "You know, it's not that it's going to be a phenomenon that could be transactions and banking and media, but it can become the world's greatest behavioral research laboratory."

Now she had more foresight than the professors at Cambridge or Oxford because I tried to get them to do a research project, and they wouldn't do it. But we walked on the beach in Florida, and you know Malcolm Gladwell talks about turning points. He's actually at Cambridge where I have worked for many years. Malcolm was right. It was a turning point. She said yes, we found the lab, and everything that's happening in this presentation has grown out of those 30 years. We've done 20,000 path experiments, we've tested across a billion emails, we've benchmarked in 36,000 companies, we've interviewed 500,000 leaders, and we have recorded, studied and analyzed 5 million phone calls. And we're still learning the answer to one single question that connects to everything I'm going to talk to you about today — Why do people say yes? Given a set of variables, options, why did we say yes to one and not the other?

Now you've heard me speak about this for 12 years, but today we're going to talk about it in a way that we never have. We're going to look at things that we've never seen, but we're still trying to fundamentally answer that question. So you don't have a customer if someone doesn't say yes. Do we all understand that? A business exists to create a customer? Peter Drucker said that many years ago. He said the job of the CEO is to create a customer. It's not to plan strategy. It doesn't matter until you have customers. That strategy is a means to an end. In the end, you've got to create and serve a customer. But I want you to go back to the Lego for a moment. So this all connects. Why do people say yes? Well, first of all, as we're going to see, it's directly connected to how they perceive reality, and there's a problem with how we perceive reality.

So if you've got this little Lego in front of you, I don't want you to ever forget it. But where is Paul Cheney? There he is, in the back. I see him. Stand up. Would you guys look at Paul? Where's Erin? Stand up, Erin. These are all team members that have worked in my presentations. Paul's in our content team. Been with me for years. Erin, how long have you been on the job now? Three weeks. So feel free to harass her, etc. I asked for Paul and our team, our data scientists, to help me illustrate a point. And you won't find this on the internet. Paul worked this out himself with our data team doing the math. I asked him a tough question. I said, "How can you illustrate effectively for me a 10 trillionth? Now we all understand what a 10 trillionth means, not 10 trillion but a 10 trillionth, a tiny fraction, one of 10 trillion. So take the Lego and imagine that every building you see in Las Vegas, every beautiful suite, like the Aria, Caesar's Palace, Wynn and The Cosmopolitan and on and on we go, was built out of Lego blocks. And let's suppose that you took one Lego block off that pile. You still wouldn't have 10 trillion. You'd have to go to Hong Kong and add every skyscraper in Hong Kong. You'd have to go to London and every skyscraper in London. You'd have to go to Paris, and you'd have to go to New York, and you'd have to work your way halfway around. In fact, if you took every skyscraper in the world, half of them, and built them all with Lego blocks, and you took one block off the pile, you'd have a 10 trillionth. Why is that important? Well, because what I'm going to say now is one of the most frightening things I know where I could possibly say ... Listen, here's the frightening thing. You and I only perceive a 10 trillionth of reality.  

A 10 trillionth. What that leads to is an undeniable question. What else is going on that I don't perceive? Now you might say, "well, how does that work with marketing?" Well, I'll remind you that point one is about observations and I'm observing something about the mind that's critical to understanding the implications for marketing. But I'll tell you one thing it says, and we'll move on from philosophy in a moment. We're all far too certain of ourselves. Uncertainty reigns. We are incipient being's limited. We are not ultimate. We cannot know all. We cannot be so sure. In fact, the real problem of philosophy or theology is to learn how to cope with uncertainty. 

Theology offers you a faith package. Philosophy offers you some other ways. But either way, it takes a certain level of bravado just to live in a world where you can only perceive a fraction of what's happening and where you truly don't know what's going to happen the next day, the next moment. Now we're going to move from that because as profound as the impact that might be and how we think about our entire life. we're here today to think about marketing. But I promise you, you can't begin to do your job right as a marketer until first of all, you recognize your blind spot, and secondly, you understand the perception gap that you've got to cope with when communicating to your prospect. So let's take it a step further. This is the Lego 1,568 skyscrapers would be necessary to make this point. And you might say, "but really? I mean it sort of feels like as a human being, we're the center of the universe." I'm not saying we're not. It feels like we're the center of the universe, and it feels like these things — touch, smell, hearing, sight — each of these are sort of the end all be all for understanding reality, but it's not true, not even in the animal kingdom.

How many of you know what this is? Well, if you don't know, you haven't missed out on much. But if you look at it very carefully, you'll notice the name is very appropriate. It's called a star-nosed mole. Now I don't know how many people in this room ... Has anyone ever seen a star-nosed mole in real life? I'm glad nobody raised their hand. But if you look at the star-nosed mole, it has 22 fingers. Its brain is somatotopically organized to process data coming in from those 22 fingers, and it then casts it into a three-dimensional image. What Is my point? It's using senses you don't have. It's perceiving another aspect of reality that you cannot perceive. And the star-nosed mole, using that sensory set, is able to see in 3D a different kind of way. We could talk about the sonar of whales, but let's look at another piece of fascinating science.

Many of you who have seen the migration of birds, but scientists had been perplexed. They've been perplexed for years and years trying to understand how do they know where to go? Have you ever wondered how do they get so far? Those are pigeons, and that is a race. How do pigeons find their way so well? Well, scientists recently discovered that pigeons have, and other birds, magnetite-based magneto receptors. You know what that means? They can sense the polarity of the earth, and they have a built-in compass. That's what guides them. I make this point only to say you don't have, you don't have an exclusive take on reality. And in fact, other parts of the animal kingdom see the world differently. The infrared-sensing pit organs of a snake — you know, snakes are deaf; they can't hear anything, and you can't really count on their sight.

First of all, they're low on the ground, but they have amazing infrared capability that allows them to see prey or danger. And by the way, there's a fascinating scientist named Eagleman who's building a vest that senses reality differently. And I have seen this in action.  You put the vest on, and a blind person can identify objects wearing the vest. The researcher holds up the object. The blind person writes its name on the board and by the receptors built into the vest, they're able to see, quote unquote. Science is working on adding more senses to our capabilities. So what does that mean for all of us? Well, it means that we need to firmly grasp the limitations that we have, or we'll never be able to overcome the challenges that we face.

Let's look at the second point then. So we've talked about reality, that it's approximated, it's reconstructed. Now we need to understand something else. Value is derived — listen, this is very important — from a limited view of reality. And so it is appraised differently. Different people might see it and understand it in different ways. Now, these two observations form the foundation for what we need to talk about with regards to marketing and its implications. Believe it or not, they have everything to do with getting that page that you saw, in the beginning, to work better. We'll connect those dots in the second section, but for now, let me explain how this might work.

I want you to watch this very closely. Watch. That doesn't look right, does it? Keep watching. Your eyes are tricking you. How does he do that? Your eyes are still tricking you. Jerry Andrus developed this. I'm going to show it to you again because many of you think, oh, I saw. In fact, I had a colleague from Harvard watch this with me and he thought "oh yeah, I see now because there's one side missing." He completely missed the point. If you, if you watch it again with me, you're going to see something happening. If you pay close, close attention, your eye is fooling you. It will make that feel like right now you are not seeing what is really there. Your eye is filling in the dimensional space of that, and if you look the way he turned it, those sides don't even exist. Watch again. Now, watch really closely. Watch this — look, look, look, look, look, look, look — that's not possible. Your eyes are fooling you. Now, watch when he turns it. Your eyes are going to step back and fool you again if you're like most people.  Now you see it's not there. See, it's not there. That side is not there. But as soon as he starts to pop it back, your eyes are going to fool you again. Your brain is doing what it's designed to do.

Now we can learn something from that. Okay? We can realize that people do not necessarily see what is really there, and one of the greatest problems in marketing, and I'm, I'm just giving you a hint of what's coming, is we presume value instead of help them truly see it. That's why they're not responding to what we do. Stay with me. Look at this next piece. Good question in Vegas, what is the value of this beer bottle? Now I know that we have a lot of employees from my group here, and they were with some employees from another group here. And I know for a fact that they didn't sleep much last night, and the beer bottle was very important to this table right here. Go ahead and confess. All right. All right. Some of our team was out with them. It's Vegas, and the beer bottle may be important to many people in Vegas, but it's more important actually to this.

The scientific name is there, but the name that's most used is the Australian Jewel Beetle. Very important to the biology of Australia, and I'm going to share with you a terrible problem. That beetle and its entire species, which is everywhere in Australia, was nearly wiped out all because they misunderstood value. Indeed, I will tell you that that beer bottle is far more important to that species than it is to anybody in Vegas, as hard as that is to believe. In fact, their survival was threatened by it. Two biologists, the short version, were in the outback, and they noticed, you know, the beer bottle on the ground where Australians had thrown it out the window. And they were doing studies, but they stopped and looked and there was one of these beetles firmly attached to the back of that bottle. And you could pick it up and shake it, and he wouldn't leave. In fact, they were so fascinated, they took out two more and set them on the ground. And in a short order, six more beetles flew in and assaulted the bottle. Indeed, beetles were so determined to interact with that bottle that they observed that while they clung to it fiercely, ants were attacking them, biting them. I don't mean to be crude, biting their genitalia. You gotta be pretty seriously attached when that's going on, and you're not doing anything. And the beetles still would not let go.

Why? Why? It's so powerful. Those beetles had been inadvertently marketed to. It wasn't the intention, but they were fooled. They thought that bottle was very important. Do you know why? Because the female of the species has some important characteristics. She is bigger, and she is dimpled. And for the male, the bigger the better. Here's what you had. An entire species trying to make with beer bottles all over the outback. Biologists did their best to, to fit. It's a classic case of the bottle destroying a relationship. The reality is that biologists did everything they could to stop this catastrophe. And when that didn't work, there was only one solution. What do you think it was? What does it? Yep. They changed the design of the beer bottles. And that's the only thing that saved the species. So what can we learn from that? We need to understand that this beetle placed extreme value on this beer bottle. Now the value it placed was very different than the value my 22-year-old son on the third row here sitting next to Julio placed probably on it last night.

But the reality is they both saw the same object, and they perceived its value differently. Do you understand? And that's vital to the next point in just a moment. But I want to show you how the subtle changes of presentation can impact the very structure of the mind. And again, if you don't understand this, you'll never be able to take marketing to its next level. You'll never be able to cross the chasm between the results you have and the results that you want. So let me show you this study. This is a piece of research done by a science team. This is the actual journal article in a peer review journal article, and you can tell from the large paragraph that we've inserted, it's a very scientific study, blind control with all the proper procedures, highly peer-reviewed and highly regarded, very well cited. And in this study, there was a unique design that I think has implications for every single person here. Take a look. Watching TV is related to math ability. How many of you believe that? I'm not saying it's wrong, I'm not saying it's right. How many believe that watching TV might impact math ability in a positive way? Let me see your hands.

Good. All right. At least three of you. All right. Now, this very scientific article was presented to a group of people, and they were asked to rate it based on the quality, the value of the scientific reasoning. And they presented it three ways. You're looking at the first way. Let me show the second way that bar graph. So this is the first way. This is the second way. Imagine that each group is ranking the quality of the reasoning. ("It makes sense to me," they said.) Very specific questions they had to answer. Can I show you the third way? A picture of a brain. That's an FMRI scan notating activity on the brain. Now what's important to note is that the study was completely made up. The bar graph had no meaning whatsoever. And the brain images had no connection whatsoever to anything said in the article ... Watch, there's the control. There's the bar graph. They're the same, right? See the control on the bar graph? People ranked the quality of the reasoning the same. Here's with the brain [higher]. Now these were not uneducated people, but they perceive the value of the study quite differently based on that. So you'll note that all throughout the MarketingSherpa conference we're showing you brain images. I started with one. [laughter]

Many of you are going to take me literally, run back on your ecommerce page and put a big picture of a brain on it next to your claims. [laughter] The point is the appraisal of value is so off, based on a slight change, nothing in the words changed. Just a picture. By the way, we don't pay enough attention to the pictures on our sites. They have a very distinct job to do. Stop buying stock images. Stop slapping smiling faces up there, and start thinking about what image would produce the highest impact. But let's keep going because this sort of leads to another place that we need to go together.

So value is derived from a limited view of reality, and this leads us to implications for marketing. Now remember, we're going to get two implications, and then we're going to look at application. We're going to work. We're going to make something better before we're done. But I want you to clearly grasp the third point. If we just presume value ... it's deadly to results. So what did we do about this? Well, I want you to see what might be wrong with this page. I want you to note that it has an eight percent conversion rate, which might sound high, but not really. It's a completely free offer. If you can't give it away, you've got problems. So think about the page; think about what's wrong. But let's just note before we actually do anything about making it better. Do you see how the value is presumed? I see "free, start now." Is that what you need? By the way, this is a big brand. These people are smart. They have high-paid marketing executives. But they have the marketer's blind spot, and we all have that. We all have to overcome that with our methodology, and in the blind spot, they know the value, but they're presuming the value in the design. They're not explicating it. And no, I'm not saying put a brain image up there by the button, but notice another one. This is one of the largest industrial companies in the world. Conversion rate is one percent. They want to generate leads, energy exploration, and extraction. So there you have it. Again, the value is presumed. Let's look a third.

This is an organization that provides the backbone for many of the biggest cellular networks in the world, including Verizon. And this group has their own direct-to-consumer offer, and it's compelling. It's powerful. But they can't get above a two percent conversion rate. Here they're trying to talk about value, but they've confused talking about cost as if that was the value. Who cares that something is $20 a month until you want it? They've misunderstood the sequence of thought. You must create a problem first, and then you must provide a solution in the form of value. Then I care about your discount and your free shipping and all the rest.

We've got to figure out how to solve that. But to do that, we get to point four. We must carefully guide the prospect's perception process. How do we, how do we manage the way they see, so to speak, our offer? And that brings us to some critical pieces. In a moment, we're going to talk about pure application. In a little bit, we're going to cash this all in with "here's what to do." But for now, I want you to think about this problem that many of us are facing all over this room. We have our offers out there, but we are not guiding their perception process. We are not carefully helping them see the value, and it's number one. Nothing has a higher impact on conversion than the value. I mean, you say, "What about the negatives, friction and anxiety."

Have you seen people stand in line for three days to buy an iPhone with lines wrapping around the block? Sometimes a mile long. Would you say there's friction there? People are camping out so they don't lose your place in line. What? What could possibly possess them to go through this, standing in a rainstorm, camping in a line to get a phone? Their perception of value. So as you keep this in mind,  I'm going to stop. We're going to work for a few minutes. This is very important. I want you to either pick a product that you represent, or your company itself. If you're a service organization, it could be for your service organization itself, your group of services. If you're B to B, it's for your business this way. If you are B to C, it's for shopping in your store or a product line that's important. And I want you to write down what you believe to be the value proposition of your product. Now we're going to do this in a group activity. In this case, you can pair up just with one other person. Both of you write it down, and then I need you to exchange the papers. So everybody's going to have to take a crack at this. Okay? And then you share it with your friend, then we're going to talk. All right, so go ahead.

... We're going to do some detective work together and to do that, I want you to see this same experiment. And we're going to zero in on a piece. You need to pay close attention because I'm going to ask you to think about it in a group setting very soon. This is that same research study. It's test protocol 1457 from our library. We have the world's largest library of experiments in case studies in this field, and we pulled it out to teach today. You recall seeing this, we talked about it, correct? Now I'm going to zero in on just a piece of it in just a moment. So if you'll look, you're seeing a control, and now you're seeing the part of the treatment. And if you look at it in this way, you'll notice there's a significant difference in the way value's being communicated. I'd like to show you the two side by side, and as you look at the control and the treatment, remember the conversion rate was like eight percent. I'm going to share with you the result. I'm not yet teaching how but look at the difference. Conversion rate goes way up. Let's look at another for just a moment. We're going to compare these two and just a few moments. So here is test protocol 1576. We saw this also. There was the control. Next, you're going to see the treatment.  I'll show them to you side by side. The difference is not that dramatic, but we are not fixing web pages. Are we all clear on that? We are operating at the level of the mind. We are operating on the thought sequence. We are doing a sort of scalpel work here. There's the control, there's the treatment, there's the difference.

Now that starts to help us understand a very simple point: That if we can somehow actualize value better, we can see a dramatic increase in our yes rate. I think many of our words confuse us. Every cell is the consummation of a series of micro-yes(s) that lead to the macro-yes that allows me to become a customer. And the way you get the greatest result is to make certain that you get every micro-yes. We try to work on the general conversion rate. Bad, bad problem. Because we conflate all those tiny micro yes(s) and their significance. I mean, to come to this summit, you had many micro yes(s) before you had ... it wasn't one "yes." You had to agree to think about what you read; you had to give it attention. Then you had to continue to do so, and then you had to work through a process that included making payment. You probably went through 50 or more micro-yes(s) to get to the decision to attend, to get it consummated in an exchange of value. So keep thinking and notice test protocol 1594. We talked about this one also. There it is. There's the control. There's the treatment. There are the two, side by side. And here's the difference. Conversion rate goes from two percent to nine percent for 262 percent improvement.

So all of this business about the brain is not some abstract concept, and it's not designed. It's most definitely not designed to keep you entertained while I speak. Because entertaining you doesn't get a result in your life when you leave. Nor is it to impress you with how clever anybody is inside of the MECLABS Institute. That doesn't make it any better. In fact, sometimes that can make it worse. You can feel like "I can't do that because I'm not a scientist." That's nonsense. You're a human being and because you're a human being, you can do this. We'll explain more about it coming up. But what I want you to see is the difference which leads me to the beginning of the application and the most important point I've said so far: Stop making claims of value and start fostering conclusions of value.

There's a huge difference. Marketers are so confused. We run around doing declaration. We declare this, we declare that we're the fastest. We're the best. We're the leading. People don't believe us. They don't perceive value from that. But explanation with statements like "I'm going to teach you" has the prospect draw a conclusion in their own mind, which they owned. And your power, all your power, all of your equity in the world depends on that conclusion. Your businesses equity doesn't exist on the balance sheet; it exists in the mind of your prospects. You say, how can that be? Well, to give you an example, anybody ever hear of Arthur Anderson? Where are they today? Gone, overnight. The balance sheet didn't protect them when they had an extreme loss of equity in the mind. People stop trusting them because of the connection to the Enron scandal, and overnight they're gone.

Lehmann brothers, what put Lehman brothers under? I was there. I was there when Bear Stearns went under. What put Lehman Brothers and Bear Stearns under was not the balance sheet. Because if depositors had remained, they could've survived. It was people's perception that they could no longer be trusted that destroyed them. It was a conclusion, a change of the conclusions in the mindset. You've got to understand how to create those conclusions, how to foster them. You can't actually grab one like we try to do it in marketing, pick out your audience and then sling it into their head with a statement of declaration. They've got to add up to a conclusion based on critical pieces of information you share with them. So let's look at this very closely now. This is test protocol 1798. This is a company based in Columbia but with a strong US market. What you're going to notice as a control. And it's a pretty good control. They're very good direct-response marketers. They've built several organizations before this one, and this page has a lot of things that are right about it, but it's still failing. Let me tell you something. I don't care how beautiful your page is ... how well it's designed or how good is the copy. If it doesn't foster the right conclusion, you still lose. So take a look for just a moment. There's the control and there's the treatment.

Let's look at them side by side: control, treatment. Now, they already had their highest-performing page. They couldn't beat the page on the left, so all we're looking for is a slight increase, which would translate right to the bottom line based on the way their margin works. And the new page produces 34 percent higher revenue. Hold on to that for a second cause you're going to look at it again in a second, but you're going to compare it to this page. This is the AMA in Canada, sort of like the AAA in the US. Do you remember this page? From the beginning? Remember you made some ideas about how you would improve it. Think about your ideas. I'm going to share with you a treatment. It is not the ultimate page. This is an iteration of multiple changes over time. But look at the treatment.

There's the control and the treatment side by side. Something magical is happening here. You know, the thing about this is, I know it's science, but if you really think about it, everything magical in the world ... If someone came from a time machine back from a 200 BC and walked over and flipped the light switch on, would that seem like magic? Boom! Light appears. If someone from AD 100 were to visit in a time machine and you put them in your car and race down the road at 70 miles an hour, would that seem like magic? They have no notion of a combustible engine. And indeed, I don't know if you know this, but when the automobile was first developed, scientists proclaimed that human beings could not survive at speeds over 30 miles an hour. Our bodies would collapse under this amazing force.

Now what I'm trying to tell you is behind all the magic in the world, maybe not all, but behind so much of what feels magical is the science. And to me, what I'm sharing with you next is magic. It's not a number. It's like changing a few words on the page with no real development lift in a few moments, and you see a 330 percent increase. And that, by the way, was revenue. Revenue went up 330 percent for their insurance product. How many of you would be settled if you leave here today and just get a hundred percent lift? So the point is it's like magic, but it's not. What's really happening is what we looked at in the first two points. Something in the mind — something's happening in the brain, something that changes the way value is perceived — and people respond to it differently. So then, I have the two side by side. Now comes the time for you to do detective work. We're going to break into groups. I'm going to give you a few extra minutes this time because what you need to do is very important. Let me look at my time. Okay. I have three hours left. It's gonna be great. [laughter]  What you need to do is look at these two in a group of three or more and decide where is the commonality. This is the optimized versions, and there's something both sides of that screen have in common. What is it? What's going on in the nature of the copy? You follow me? So try to identify the pattern that you might see that's connected between the two. With that in mind, break into your group and let's go.

Did anybody tell me something you see that's common between them? Say it again? ... What about the structure? The same? Okay. The same flow in terms of structure, the way the words are laid out on the page. What else? Yes sir. Consumable benefits. All right, good. Somebody else? Yes. All right, so there's some addressing of risk and anxiety which are on the negative side of the equation. All right, good. And you're right. But focus with me now on the value side. Even though you're absolutely right. Focus on the value side. How is the value being communicated similarly? We're fostering a conclusion. Any technique you see taking place? Right over there. Both start with what you're going to get from the product. Very good. Yes, the very first word is an action verb. Very important. Somebody else? One more idea from someone, right over there. Okay. That's one of the most important things. He said both use exact numbers to show the value.

Now I'm very limited ... The teacher in me wants hours to unpack all this and break it down so you can see it. There's so much more we could say if we had a long time, but the goal today is to give you something realistic that you can take back and use to get impact. You know, on Thursday I'm teaching for eight hours on website optimization. It's a full class, but if you want to get it, you can. If not ... you can get the online version of it, and it'll get into much more depth.

But let's watch this for a second and I want to share with you this excerpt from my book, which you can get here, but the point is — this is our explication of the value proposition. This is the product of 20,000 experiments. This is a heuristic that breaks down how to win in the mind as it relates to communicating the value proposition. And I'm going to borrow a little bit of it right now to help you see something. So we need to work through two key pieces. Would you all agree that no matter what you communicate about your value, if I don't understand it, it doesn't work? We all understand that, right? But what if I understand it, but I don't believe it? Does it work? It doesn't work. In fact, if you can think of these as multipliers, if clarity is zero, no matter how high the value is, let's call value 100 — What is zero times a hundred? — So if your value is 100 but I don't understand your value, they're still at zero. Many marketers are confident because they have that hundred in their mind and they think, well, of course, they're going to buy, but I don't understand the value. So you get zero.

What about belief? This is our biggest challenge. It's very hard to foster a conclusion because marketing has moved from being a servant-oriented mindset to an adversarial-oriented mindset. It doesn't have to be that way, but if they think your the adversary trying to trick them, trying to fool them, trying to move them — and that's what they think, by the way, when we use all this strange language in our marketing. Marketing speak. Words that we never use with anyone else. I was teaching yesterday, and I illustrated the point by saying, how many of you would go up at the cocktail hour tonight or at the party and say, "hi, I'm the world's leading expert on ecommerce, and I'm fast. And people say I am ranked at high quality.  It sounds so horrible. Every time I say it, I want to gag, but isn't that exactly how we communicate on our page? What does that produce? Do you think that produces the right conclusion in somebody's mind? The more expert you become at marketing the less we become in touch with what it means to be a consumer. Hanging out with marketers is dangerous because we all learned to talk in a certain language, and we get bad habits and then we communicate that way. We showed, I mentioned this yesterday, we showed in two separate studies a thousand marketers before-and-after test results, but first we just show them the two pages. We didn't tell them which one was best, and we asked them to vote. In the first study, 72 percent of the marketers chose the wrong page.

Now think ... you could do better flipping a coin. A trained monkey could probably beat that. So it didn't seem right. So we ran the study again with a thousand marketers. First time, 72 percent. The number the next time, 74 percent. What's wrong? I mean, I could have picked somebody off the street, seriously, and they'd have done a better job than the marketer at picking the winning treatment. Why? Because the more we get engaged in the marketing culture, the less we become in touch with the average consumer. We think differently. We talk differently, we infect ourselves, and our blind spot gets in the way.

So let's think about these three steps because what you saw really happen was we simplified. We layered data so you could click through, but you didn't have to have it all in your face now. And we sequenced it properly to match the way people were thinking, the order of their concerns. That helped people understand. But understanding was not enough. 

We used specification. Do you know what that means? Don't tell me you have the world's largest inventory. Tell me you have 117,621 products, and make sure it's accurate. When it changes, change it. Give me a number, and your credibility will go up. So we used specification and we quantified — very specific.

What's the difference between a quantified statement or a quantification and a qualification? If somebody uses a qualitative statement, let's use that word, as opposed to a quantitative statement, what's the difference in the two? Somebody tell me what a quantitative statement Is. Okay. It's numerical. It's measurable. What is a qualitative statement? Yeah, it's an opinion. It can't be backed up with a number. Here's a simple rule. Don't make qualitative statements about yourself. Same profit at the party. If I walk up to you now and say hi, I'm really handsome, aren't I, it's going to just produce a horrible effect. It's not true either. I know. The bottom line is ... let somebody else say it. Let their rating system say it, let a customer say it, but don't brag about yourself. It's disgusting. And we don't foster the right conclusion when we do that. So specify, quantify and verify.

What does verify mean? What is verification in this? You need third-party evidentials. What is a third-party evidential? That's when someone certifies what you're saying. That's when Yahoo, or let's take Amazon, gives you a four and a half star rating, or some ecommerce service or a trust verification around your privacy statement or an important authority figure. PC magazine talks about how good your product is. Do you understand you're leveraging someone else, a third party with high authority and credible, to talk about you, so that you yourself don't make the mistake of trying to make a claim without backing it up? We spend so much time, I mentioned this earlier, we're declaratIve in our marketing. We're this, we're that ... Try this, take a red pen, print your webpage and mark in red through every declarative statement.  See what you have left.  And we wonder why people don't understand. We're too busy saying things about ourselves instead of explaining things in a way that helps the other side understand and believe. It's the combination of the two that produces the conclusion, and when you get the right conclusion in their mind, you get the yes. When you get the yes, you get the customer. Does that make sense to everyone?

So if we look at those pages and think about them that way, that's what's taking place. And just remember the AMA. They're a highly credible organization. There a not for profit. They're one of the most dominant organizations in Canada in terms of not for profits and among all the other provincial travel groups, they're the biggest. They're in Ontario, I think. But do you know what? For all that credibility, that page was under-producing every single day until it was optimized. It was leaking 330 percent. When you think about it that way, it's frightening. How much money is dribbling out of all your work right now? How much of it is leaking out of your funnels while you sit in this meeting because you haven't helped people build the right conclusions? Just like the Australian jewel beetle, they're not seeing the same thing you are.

So we come to my most interesting point for me. It's the funnest one to talk about. Stop relying on a brand promise. I'm so disgusted with brand promises. Brand is amazing when it's right, but most of the time it's wrong. David Ogilvy was a genius and his leveraging of the concept "brand" was brilliant. But David said something that many agencies have forgotten. He said, "Make every word sell." He understood that brand had an important part to play. It is the aggregate experience of the value proposition. And from the experience of the value proposition (not necessarily by you. It could be your friends who experienced it, but they talked to you about it all over the marketplace.) The experience of the value proposition creates an expectation. And all the power of brand is in the explanation and the expectation that is owned inside of that vault, the brain, the mind of the prospect. When you make a brand promise, I think to myself, "oh yeah, right, you and 200 others who hit my inbox today with trash promising what your brand is going to do for me." There's no power on a brand promise. There's only power from the brand delivery. When you deliver the promise, you create an expectation. That's why you've heard me say this many times, if Apple created an iChicken, we'd stand in line for two miles to get it. We wouldn't even know why it was cool, but we know that we're going to like it once we get it. And if you think that's out there, let me tell you something. When they produced the tablet, the whole world said, "What a joke. Nobody's going to want this." I read all the blogs. Nobody was positive. Everybody was negative. "No one's going to sell that." And then hundreds of millions of tablets later, we all sing a different tune. They knew what we wanted before we knew what we wanted, but we experienced that. And by the way, if Apple messes it up, and they're making big mistakes right now, if they mess up that power of expectation in your mind, they're doomed. They have an installed platform, they have so much revenue coming in that it can cover up the decay going on on the inside if they're not very careful, for many years. But the inside will rot out because expectation will go down.

So how do we understand this? How do we apply this today? I'm going to go to the most important part of this presentation in just a moment, but first I'm just going to show you how creating brand or using it, leveraging it properly, changes results on an identical page, virtually. Look at the two pages. The content is basically the same. One is the control. We were doing experiments in The Boston Globe. They ran on our servers for many years. And Peter Doucette who oversaw all this has lectured in the keynotes and we have videos of this. We watched The Boston Globe's trend line go from down to up, from the moment we launched these experiments. And you can see like a hockey stick, It starts to go up. Peter tells this story. He said when we were first starting this, flat was the new up. If we could just stay flat and not go down, we were doing good. Last year, The Boston Globe raised prices. Has anybody seen a newspaper raise prices? They're going extinct all over the world ... Last year The Boston Globe increased prices by 74 percent, but in the beginning, they had some challenges. This is the control, and this is the treatment. I'm sharing them with you side by side, and all that I want to show you is the difference of putting that little brand on the top more dominantly. It produced a 40 percent increase with no changes to the copy below. What's going on there?

Suddenly, the page has the power of the brand expectation leveraged against the copy, and it produces a different set of conclusions about the offer. Now I'm going to share with you some things about this that are so exciting. Before we end, I'm watching my time. It is limited. I have 10 minutes and 47 seconds, 46, 45 and I've got to deliver the final payload to you, but I need you to move swiftly through, I think, the most important activity. And that will give me just a few minutes to share with you something pretty amazing. So here's the activity. I asked you to write down your value proposition. The first thing I want you to do is look at the value proposition that was placed in front of you and ask if it answers this question. If it doesn't, it's not working for you. so take your colleague's value proposition, we're going to rank it, and you're going to ask these questions.

Did the answer that they placed to the question, what is your value proposition, form a reason? Could you put the word "because" in front of it? And then, does your answer pass this 4-conclusion test? IC stands for ideal customer. Will the ideal customer conclude, "I want it."? Will the ideal customer conclude, "I can't get it (exactly like this) anywhere else"? Will the ideal customer conclude, I (instantly) understand it"? Will the ideal customer conclude, "I (naturally) believe it"?

Now you'll notice that we're getting ready to do a scientific experiment. I want you to work on that copy, rating it in just a moment. Leave these cups sitting right where they are on the inside aisle. And we'll use this to leverage this understanding in an even deeper and more profound way. (Paul, you're lovely. That's a wonderful job pushing that cart. I've found your natural gifts. [laughter]) All right, so go ahead. Finally, does the answer they give me connect to the experience of the brand? Is it somehow encapsulated emotionally and rationally by the brand? With that in mind, let's take a few moments to just take the music up and let's rank these. We have a limited amount of time, so look at your colleague’s notes and see what you can do. Let's go.

I know it's an embarrassing question, but how many of you looked at your colleague's value proposition as written on the piece of paper and it matched this criterion extremely well? Look around the room.

Look around the room. This is the problem. This is the climax of everything I'm saying to you. I can't take the time to apply this for an extended period, but every one of you can take this back, and yes you can get a copy of the deck. It'll be in a PDF, and you can study it. This criterion should be applied to your value proposition. And until it is an ultimate reason that achieves four conclusions in the mind and until those conclusions are enhanced, encapsulated, by the brand, the brand is simply a Polaroid image of that entire quality experience that produces those four conclusions. And if your brand's not doing that, it's not doing its job either. You know what? I'm so weary of rebranding exercises. It's like we have this house where the plumbing is broken and the heating and air, it doesn't work, and the roof is leaking. So what do we do? We'll paint it.

Every new CEO comes in and we paint the house again. But until you change the experience inside, it doesn't matter what you do on the outside.  Brand ... Agencies, I'm not picking on you, but it's just an industry. It's billions of dollars being raised by doing rebranding exercises that produce very little difference in the marketplace. Because we're focused on the outside instead of on the inside. Because we don't understand the things we've been talking about today, and we don't engineer with the brand. We don't engineer these conclusions carefully, methodically. When a brand has done that right, just seeing its little icon evokes the experience. I write poetry to explain philosophy, and in an observation, I once wrote that a poem is just a Polaroid image of the heart. I can read a poem I wrote 10 years ago and I feel all the same emotions again, feel all the same experiences again. I don't care about writing them for the world as much as just capturing the intricate meaning that I'm experiencing at the moment. And when I pull that poem up and read it, I experience the same thing all over again.

That's what a brand is supposed to do. So we have only a little time remaining, and we don't have a lot that we need to do. I'm going to share these two anonymous cans. I'm going to ask each person unless you have a health requirement, and if so, if you don't want to do this, just pass it to the person next to you. I'm going to have you take a drink from each cup. One of the cups is Coke, but I'm not going to tell you what's in the other cup. I want you to tell me which one tastes the best, or which one do you prefer. Okay, so go ahead because of our time. Take your drinks right now.

All right. You've got to taste it. Yes. Taste each one, all right? Taste each. Did everybody taste it? All right, now we're going to do a simple test here. Those of you that favor the substance in the cup that isn't labeled, let me see your hands.  Okay. Those of you that favored, favored the substance in the cup that is labeled coke. Let me see your hands. Look around the room. Hold them up. Now you have to vote for one. Okay? All right. Now look, hold them up high, please. Please hold them up high. That's for Coke. All right, now put them down. Hold your hands up if you like the other cup. Okay, so I see three, four hands and the rest are all the Coke cup. Okay, that's important. It's very important really because both of those glasses contain Coke. [laughter]  Now I want you to notice the phenomenon here because it's remarkable. Both have the same thing in them, but that which is labeled Coke is producing at least double, maybe more, the response rate. Why? Because there's an expectation that happens in the brain ... Let me unpack this in a study that was done.

So you'll notice two anonymized cans. This exact move was done by a team of scientists.  It's called "Neural correlates of behavioral preference for culturally familiar drinks." ... And in this study, both of these were compared just like that. And then they did an experiment where they used Pepsi and they used Coke. And they had them so both were the same. You know, one had Pepsi, another one with Coke. I won't break it all down. You can look up the study. What's really important here is the discovery. So watch and think about this. This was a very carefully peer-reviewed study done by a team of scientists and particularly neuroscience. They were doing FMRI scans of the brain. They did it blind. They get it right. But what did they discover? Well, let's look.

So this is the preference level when the study was done anonymously so that people couldn't know either way. This is the preference level when they labeled one Pepsi — even if it's coke, right? And this is the preference level when they labeled one Coke. People took the same substance from the cup, and with the expectation in their mind, they somehow believed, just like we saw right here, that the Coke tasted better. Now, let me ask you a question. Who's doing a better job of marketing their brand — Pepsi or Coke? Now I know that's fascinating to me. It's amazing. It goes back to everything we've been learning ...

But what's more interesting to me is that when they scanned the brain for the anonymous, there was no particular activity in the key areas of the brain. When they scanned the brain for Pepsi in the pleasure sectors, in the hippocampus and key other areas, there was no perceivable activity in the brain. If you know how these scans work, there can actually measure the stimulation of blood in the brain. FMRI scanning has changed neuroscience and our understanding of the brain. It's opening up whole new frontiers. Inside of MECLABS, we're going to be using it throughout the purchase process to understand how anxiety is created and where it appears in the brain. Friction — where it appears in the brain and what you can do. And we should be able to see in the image before we see the purchase changes in the brain that indicate what's happening in the purchase. I'm going to do a study where marketers are looking at brain images and they can tell you what happens in the purchase process before they actually see the numbers.

I want to just show you my last slide. This is what the brain looked like for Coke. No, it didn't look like that when they drank Coke not knowing it was Coke, but when they were told it was Coke. Do you see all these areas lit up? The hippocampus and the DLPFC, these are pleasure area. Look at all this activity going on in the mind. It literally changed what's happening in the brain itself. It wasn't just some fantasy belief. It did taste better. That's the important part. It did taste better when you knew it was Coke.

Marketers, what does that say to you? We have a job to do. We have to understand brand is not about promises. It's about creating an expectation. And that's what's happened with this brand. That's why Warren Buffet — I can't believe he's not here. I invited him. He just didn't come. [laughter] — That's why Warren Buffet invested in Coke stock. Literally. I remember when he did it ... What Warren Buffet sees in financials is what we see with our heuristics. He detects value propositions. I could break it down for you. I could show you the correlates very clearly. Given five years of financials, he can find a value proposition. But he's looking at the result, and we're looking at the costs. I shared that with you to say that Buffet invested in Coke because he said the balance sheet for Coke doesn't truly represent the power of the brand. "This is a bargain even if I pay market price." That's one of his most powerful and rewarding investments, that and insurance.

That's what happens in the brain. So marketers, stop making brand promises, start fostering brand conclusions. You can learn more about that in the UF program. They've asked me to share with you. if you don't know this, they've teamed up with MECLABS to offer graduate degrees in this work you're seeing right now.  We're giving a scholarship away at the UF booth, which is just outside the main door ... at the end of this conference we'll announce the winner, you'll be able to get the course free. So if you're interested in that, go see them and talk to them — and I'm done. Thank you very much.

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