đź“š Hooked: How to Build Habit-Forming Products – Nir Eyal

Kindle Highlights

  • Cognitive psychologists define habits as “automatic behaviors triggered by situational cues”: things we do with little or no conscious thought.
  • Trigger is the actuator of behavior—the spark plug in the engine.

The Hook model

from: https://www.alexandercowan.com/the-hook-framework/

The Hook Model has four phases: trigger, action, variable reward, and investment.

Trigger

  • A trigger is the actuator of behavior.
    More choices require the user to evaluate multiple options. Too many choices or irrelevant options can cause hesitation, confusion, or worse—abandonment. Reducing the thinking required to take the next action increases the likelihood of the desired behavior occurring unconsciously. (Hick’s law)
    As a readily accepted aspect of interface design, these calls to action don’t need to tell people how to use them; the information is embedded. (Affordance)
  • Types of External Triggers: 1. Paid Triggers Advertising, search engine marketing, and other paid channels are commonly used to get. 2. Earned triggers are free in that they cannot be bought directly, but they often require investment in the form of time spent on public and media relations. 3. Relationship Triggers One person telling others about a product or service can be a highly effective external trigger for action.
  • Relationship triggers can create the viral hyper-growth entrepreneurs and investors lust after. Sometimes relationship triggers drive growth because people love to tell one another about a wonderful offer. Proper use of relationship triggers requires building an engaged user base that is enthusiastic about sharing the benefits of the product with others.
  • Owned Triggers: Owned triggers consume a piece of real estate in the user’s environment. They consistently show up in daily life and it is ultimately up to the user to opt in to allowing these triggers to appear. While paid, earned, and relationship triggers drive new user acquisition, owned triggers prompt repeat engagement until a habit is formed.
  • Internal Triggers When a product becomes tightly coupled with a thought, an emotion, or a preexisting routine, it leverages an internal trigger. Internal triggers manifest automatically in your mind. Connecting internal triggers with a product is the brass ring of consumer technology.
  • Emotions, particularly negative ones, are powerful internal triggers and greatly influence our daily routines. Feelings of boredom, loneliness, frustration, confusion, and indecisiveness often instigate a slight pain or irritation and prompt an almost instantaneous and often mindless action to quell the negative sensation.
  • In the case of internal triggers, the information about what to do next is encoded as a learned association in the user’s memory.
    The ultimate goal of a habit-forming product is to solve the user’s pain by creating an association so that the user identifies the company’s product or service as the source of relief.
    You’ll often find that people’s declared preferences—what they say they want—are far different from their revealed preferences—what they actually do.
  • Triggers cue the user to take action and are the first step in the Hook Model. Triggers come in two types—external and internal. External triggers tell the user what to do next by placing information within the user’s environment. Internal triggers tell the user what to do next through associations stored in the user’s memory.

Action

  • The behavior done in anticipation of a reward.
  • Fogg posits that there are three ingredients required to initiate any and all behaviors: (1) the user must have sufficient motivation; (2) the user must have the ability to complete the desired action; and (3) a trigger must be present to activate the behavior.
  • Dr. Edward Deci, Professor of Psychology at the University of Rochester and a leading researcher on the self-determination theory, defines motivation as “the energy for action.”
    According to the Fogg Behavior Model, ability is the capacity to do a particular behavior.
  • Naturally, all three parts of B = MAT must be present for a singular user action to occur; without a clear trigger and sufficient motivation there will be no behavior. However, for companies building technology solutions, the greatest return on investment generally comes from increasing a product’s ease of use. The fact is, increasing motivation is expensive and time consuming.
  • Influencing behavior by reducing the effort required to perform an action is more effective than increasing someone’s desire to do it.
    Product can decrease in perceived value if it starts off as scarce and becomes abundant.
  • The mind takes shortcuts informed by our surroundings to make quick and sometimes erroneous judgments.
  • The framing heuristic not only influences our behaviors; it literally changes how our brain perceives pleasure.
    People often anchor to one piece of information when making a decision.
  • The study demonstrates the endowed progress effect, a phenomenon that increases motivation as people believe they are nearing a goal.
  • For any behavior to occur, a trigger must be present at the same time as the user has sufficient ability and motivation to take action. To increase the desired behavior, ensure a clear trigger is present; next, increase ability by making the action easier to do; finally, align with the right motivator.
  • Ability is influenced by the six factors of time, money, physical effort, brain cycles, social deviance, and non-routineness. Ability is dependent on users and their context at that moment.
    Heuristics are cognitive shortcuts we take to make quick decisions.
  • By making an intended action easier to do, people will do it more often.

Variable Rewards

  • People who observe someone being rewarded for a particular behavior are more likely to alter their own beliefs and subsequent actions.
    Rewards must fit into the narrative of why the product is used and align with the user’s internal triggers and motivations.
    In fact, a recent study found social factors were the most important reasons people used the service and recommended it to others.
    To change behavior, products must ensure the users feel in control.
    An element of mystery is an important component of continued user interest.
  • Finite variability—an experience that becomes predictable after use.
    Experiences with finite variability become less engaging because they eventually become predictable. Products utilizing infinite variability stand a better chance of holding on to users’ attention, while those with finite variability must constantly reinvent themselves just to keep pace.
  • Variable reward is the third phase of the Hook Model, and there are three types of variable rewards: the tribe, the hunt, and the self. Rewards of the tribe is the search for social rewards fueled by connectedness with other people. Rewards of the hunt is the search for material resources and information. Rewards of the self is the search for intrinsic rewards of mastery, competence, and completion.
  • Research shows that levels of the neurotransmitter dopamine surge when the brain is expecting a reward. Introducing variability multiplies the effect, creating a focused state, which suppresses the areas of the brain associated with judgment and reason while activating the parts associated with wanting and desire.
  • Habits are defined as “behaviors done with little or no conscious thought.”

Investment

  • The more effort we put into something, the more likely we are to value it; we are more likely to be consistent with our past behaviors; and finally, we change our preferences to avoid cognitive dissonance.
  • The last step of the Hook Model is the investment phase, the point at which users are asked to do a bit of work. Here, users are prompted to put something of value into the system, which increases the likelihood of their using the product and of successive passes through the Hook cycle. The big idea behind the investment phase is to leverage the user’s understanding that the service will get better with use (and personal investment).
  • The company found that the more information users invested in the site, the more committed they became to it.
  • Once users have invested the effort to acquire a skill, they are less likely to switch to a competing product.
  • Unlike the action phase, which delivers immediate gratification, the investment phase concerns the anticipation of rewards in the future.
  • Investments in a product create preferences because of our tendency to overvalue our work, be consistent with past behaviors, and avoid cognitive dissonance. They enable the accrual of stored value in the form of content, data, followers, reputation, or skill.
  • Investment The last phase of the Hook Model is where the user does a bit of work. The investment phase increases the odds that the user will make another pass through the Hook cycle in the future. The investment occurs when the user puts something into the product of service such as time, data, effort, social capital, or money.

The Habit Zone

  • Fostering consumer habits is an effective way to increase the value of a company by driving higher customer lifetime value (CLTV): the amount of money made from a customer before that person switches to a competitor, stops using the product, or dies. User habits increase how long and how frequently customers use a product, resulting in higher CLTV.
  • Habits give companies greater flexibility to increase prices.
  • Frequent usage creates more opportunities to encourage people to invite their friends, broadcast content, and share through word of mouth. Hooked users become brand evangelists—megaphones for your company, bringing in new users at little or no cost.
  • Products with higher user engagement also have the potential to grow faster than their rivals.
  • more is more principle—more frequent usage drives more viral growth.
  • “The most important factor to increasing growth is … Viral Cycle Time.” Viral Cycle Time is the amount of time it takes a user to invite another user, and it can have a massive impact.
  • Having a greater proportion of users daily returning to a service dramatically decreases Viral Cycle Time for two reasons: First, daily users initiate loops more often (think tagging a friend in a Facebook photo); second, more daily active users means more people to respond and react to each invitation. The cycle not only perpetuates the process—with higher and higher user engagement, it accelerates it.
  • A classic paper by John Gourville, a professor of marketing at Harvard Business School, stipulates that “many innovations fail because consumers irrationally overvalue the old while companies irrationally overvalue the new.”
  • Gourville claims that for new entrants to stand a chance, they can’t just be better, they must be nine times better. Gourville writes that products that require a high degree of behavior change are doomed to fail even if the benefits of using the new product are clear and substantial.
  • Users also increase their dependency on habit-forming products by storing value in them—further reducing the likelihood of switching to an alternative.
  • The nontransferable value created and stored inside these services discourages users from leaving. For one, new behaviors have a short half-life, as our minds tend to revert to our old ways of thinking and doing. For new behaviors to really take hold, they must occur often. For an infrequent action to become a habit, the user must perceive a high degree of utility, either from gaining pleasure or avoiding pain.
  • A company can begin to determine its product’s habit-forming potential by plotting two factors: frequency (how often the behavior occurs) and perceived utility (how useful and rewarding the behavior is in the user’s mind over alternative solutions).
  • The researchers also found that the complexity of the behavior and how important the habit was to the person greatly affected how quickly the routine was formed.
  • Painkillers solve an obvious need, relieving a specific pain, and often have quantifiable markets. Vitamins, by contrast, do not necessarily solve an obvious pain point. Instead they appeal to users’ emotional rather than functional needs.
  • When successful, forming strong user habits can have several business benefits including: higher customer lifetime value (CLTV), greater pricing flexibility, supercharged growth, and a sharper competitive edge.

What are you going to do with this? Manipulation matrix

  • Effective hooks transition users from relying upon external triggers to cueing mental associations with internal triggers.
  • Questions to ask yourself while working on a product: What do users really want? What pain is your product relieving? (Internal trigger) What brings users to your service? (External trigger) What is the simplest action users take in anticipation of reward, and how can you simplify your product to make this action easier? (Action) Are users fulfilled by the reward yet left wanting more? (Variable reward) What “bit of work” do users invest in your product? Does it load the next trigger and store value to improve the product with use? (Investment)
  • Manipulation is an experience crafted to change behaviour.
  • Entertainment is a hits-driven business because the brain reacts to stimulus by wanting more and more of it, ever hungry for continuous novelty.
  • Building an enterprise on ephemeral desires is akin to running on an incessantly rolling treadmill: You have to keep up with the constantly changing demands of your users.
  • Facilitators use their own product and believe it can materially improve people’s lives. They have the highest chance of success because they most closely understand the needs of their users.
  • Peddlers believe their product can materially improve people’s lives but do not use it themselves. They must beware of the hubris and inauthenticity that comes from building solutions for people they do not understand firsthand.
  • Entertainers use their product but do not believe it can improve people’s lives. They can be successful, but without making the lives of others better in some way, the entertainer’s products often lack staying power.
  • Dealers neither use the product nor believe it can improve people’s lives. They have the lowest chance of finding long-term success and often find themselves in morally precarious positions.

Habit Testing:

  • Does your users’ internal trigger frequently prompt them to action? Is your external trigger cueing them when they are most likely to act? Is your design simple enough to make taking the action easy? Does the reward satisfy your users’ need while leaving them wanting more? Do your users invest a bit of work in the product, storing value to improve the experience with use and loading the next trigger?
  • If at least 5 percent of your users don’t find your product valuable enough to use as much as you predicted they would, you may have a problem.
  • Habit Path: The goal of finding the Habit Path is to determine which of these steps is critical for creating devoted users so that you can modify the experience to encourage this behavior.
  • Tracking users by cohort and comparing their activity with that of habitual users should guide how products evolve and improve.
  • Once a product is built, Habit Testing helps uncover product devotees, discover which product elements (if any) are habit forming, and why those aspects of your product change user behavior. Habit Testing includes three steps: identify, codify, and modify.
  • First, dig into the data to identify how people are using the product.
  • Next, codify these findings in search of habitual users. To generate new hypotheses, study the actions and paths taken by devoted users.
  • Finally, modify the product to influence more users to follow the same path as your habitual users, and then evaluate results and continue to modify as needed.
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