Not long after his breakthrough, Clinton Kilts helped to found a new division for the American marketing consultancy BrightHouse, their Neurostrategies Group. Their focus was not intended to be ordinary market studies of the type that are supposed to tell producers how to put together a commercial for strawberry jam or sports cars to hit a target market. It was claimed in their launch statements that all the studies done would be of a general character–designed to increase our understanding of how consumers think and, in particular, how they develop a relationship to companies and brands.

The discussion quickly came to turn on the concept of branding. The fact that something–be it a product, an institution or a concept, for that matter–is not just immediately recognizable but has a narrative of its own. The product is not just a physical thing but comes with a whole mental universe that penetrates the consumer. Think of Gucci, iPod, Mercedes, and take note of the images the words bring to mind. Branding has been a hot topic for a long time in the advertising world, and it is one with phenomenal force. Most of us know that branding palpably influences our choices and shopping habits, but researchers suspect that branding can also fundamentally change the way we comprehend sense impressions.

At least that is the obvious conclusion to be drawn from the only (so far) classic study in neuromarketing, a fascinating study of what can be called the Pepsi paradox. For decades, it has been known that Pepsi is the preferred cola in blind taste tests, but it is still Coca-Cola that continues to be the absolute bestseller in the U.S. and the rest of the world. However, since 2004, we have been able to see the short-circuit going on in the head of the cola-drinking masses.

The originator of the experiment was Read Montague of Houston’s Baylor College of Medicine, who must be credited with breaking through to the broader public with the experiment, which was essentially a cola-tasting while being subjected to MRI. Just under seventy volunteers were first asked to taste the competing products in a blind tasting and, just as so often before, Pepsi was the big winner. Pepsi also set off greater activity in the so-called ventral putamen than Coca-Cola. The putamen is an area cradled deep in the brain in the striatum, which is, among other things, a component in the reward system. So, the interpretation was straightforward–the activity meant "this feels good."

In the next series of experiments the subjects tasted colas with visible labels. When the research subjects knew which brown liquid was which, almost all of them suddenly preferred Coca-Cola. They were convinced that the taste of Coca-Cola was far superior to Pepsi. This shift in attitude followed an important change in the brain–this time, the medial prefrontal cortex went into action. The cerebral cortex intervened with its higher cognitive processes and triumphed over the immediate feeling of reward that was evoked by the taste impression. The product that actually tasted worse and provided a poorer physiological reward was viewed as better when the whole identification apparatus and the idea "this is so me" went into action.

The cola experiment, which came out in the journal Neuron, might be said to show that branding is mind over matter. And, of course, this got marketing people to think in a new way. Now they could hope that the methodology of brain research would help to explain how people build up the much sought-after positive branding story. The dream is that researchers with their scanners will discover what has to be done to get the right elements into play to achieve a tenable branding. Storytelling aimed right at the medial prefrontal cortex.

Excerpted from Mindfield: How Brain Science is Changing Our World by Lone Frank. Copyright © 2009 by the author and reprinted by permission of Oneworld, previously published in Danish as Den Femte Revolution by Gyldendal in 2007, English translation by Russell Dees