(notes on) Hooked by Nir Eyal
NB. These notes contribute towards my diyMBA, my attempt to learn lots without a formal MBA programme. Check out my full reading list, and why I’m doing it DIY.
In summary, Hooked proposes a four-step framework to build habit-building products. Great for building a business, and also for understanding why we ourselves are so hooked and tips for overcoming our addiction. Though released in 2014 — a long time in internet years — its aged well and is an essential read for anyone starting out or if you missed it first time round. AND its a quick, to-the-point read with no padding… a rare achievement.
Buy the book!
TLDR
A successful habit-forming product will gain a loyal, growing following with high user engagement without the need for costly advertising.
We all use habits to make our everyday life easier, and often make new habits. Products can become part of this routine by creating a Hook using a simple 4-step process of Trigger, Action, Reward and Investment.
My Notes
Why Habits are Good for Business
Habits are the things we do with little or no conscious thought, guiding nearly half our daily actions. They allow the brain to simplify complex behaviours, allowing us to focus our attention on other activities.
Turning the use of your product into a user habit helps your business:
- Increase Customer Lifetime Value (CLV). By increasing the frequency and time spent of usage, increasing revenue opportunities (direct spending or ads) and reducing churn.
2. Provide Pricing Flexibility. Highly engaged users are less sensitive to price changes
3. Supercharge Growth. Users are more likely to tell their friends about your product or share more content.
4. Sharpen Competitive Edge. Products that change customer routines are less susceptible to attacks from new entrants, who must be “nine times better” (John Gourville, HBS) to compete with replacing old habits that die hard.
Solving Real Problems: Painkillers vs Vitamins
All successful innovations solve problems using either Painkillers or Vitamins.
Painkillers solve an obvious need by relieving a specific pain. eg Uber gets you somewhere, Evernote gives you a place to store your notes and ideas.
Vitamins do not solve an obvious need or relieve a specific pain. Instead they appeal to users’ emotional rather than functional needs. eg Social Media allows you to keep updated and interact with a group. Not an immediate need, at least to begin with.
However, a habit is formed when not doing an action causes a bit of pain. Checking social media may begin out of curiosity, but soon it can fulfill a definite need to feel seen or included. Not doing so causes pain.
“The desire to be entertained can be thought of as the need to satiate boredom. A need to share good news can also be thought of as an attempt to find and maintain social connections”
Nir Eyal
Habit-forming technologies are both vitamins and painkillers. They begin as nice-to-have vitamins, but once the habit is established they provide an ongoing pain remedy.
The Hook Model
- Triggers
Like the spark plug in an engine, Triggers kick off the Habit Hook and come in two types, External and Internal.
External Triggers are a call-to-action pushed to the user from an external source, such as a notification or prominent button. They contain key info and clearly show what the next step is. 4 types include:
- Paid Triggers, eg advertising
- Earned Triggers, eg favourable press mentions, featured store placements
- Relationship Triggers, eg a recommendation from a friend
- Owned Triggers, eg app notification, email newsletter.
Paid, earned and relationship triggers drive new user acquisition, whilst owned triggers prompt repeat engagement until a habit is formed.
Internal Triggers manifest automatically in your mind, and occur when a product becomes tightly coupled with a thought, an emotion, or a pre-existing routine.
Emotions, particularly negative emotions, 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.
Positive emotions can also be internal triggers, but may arise to satisfy something that is bothering us. The desire to be entertained can be thought of as the need to satiate boredom. A need to share good news can also be thought of as an attempt to find and maintain social connections.
Users who find a product that alleviates their pain will, over a period of several months, form strong, positive associations with the product.
2. Action
Following a trigger comes the action: the behaviour done in anticipation of a reward.
The simple action of clicking on the interesting picture in a newsfeed, opening the app, or playing that next level of the game form the ‘action’ phase of the ‘hook’.
Companies must ensure the user has both:
- The ability to perform an action, eg your phone rings but you can’t find it in your bag, so you don’t take action and answer. Any technology that significantly reduces the steps to complete a task will enjoy high adoption rates by the people it assists. Easier is always better.
- The motivation to perform an action, eg your phone rings but you suspect its a telemarketer, so you don’t take action and answer. This includes to seek pleasure, hope or social acceptance and avoid pain, fear, and rejection.
Where to start — Ability or Motivation? Start with Motivation by making it simple.
“ Take a human desire , preferably one that has been around for a really long time. Identify that desire and use modern technology to take out steps. ”
Evan Williams (Blogger, Twitter, Medium).
Factors that influence a task’s difficulty:
1. Time: how long it takes to complete an action
2. Money: the fiscal cost of taking an action
3. Physical Effort: the amount of labour involved in taking the action
4. Brain Cycles: the level of mental effort and focus required to take an action
5. Social Deviance: how accepted the behaviour is by others.
6. Non-routine: how much the action matches or disrupts existing routines
Heuristics are also important. Understand Scarcity, Framing, Anchoring, Endowed Progress effects.
3. Variable Reward
Reward your users by solving a problem, reinforcing their motivation for the action taken in the previous phase.
“What draws us to act is not the sensation we receive from the reward itself , but the need to alleviate the craving for that reward.”
Nir Eyal
But the same reward creates a predictable feedback loop, which quickly gets tired. Therefore, rewards must be variable which come in three types:
- Rewards of the Tribe. We depend on one another, and are driven by our connectedness with other people. We seek rewards that make us feel accepted, attractive, important and included.
2. Rewards of the Hunt. We need to acquire physical objects, such as food and supplies that aid our survival. Where we once hunted for food, today we hunt for other stuff, like information.
3. Rewards of the Self. People desire to gain a sense of competency. We are driven to conquer obstacles, even if just for the satisfaction of doing so.
“Only by understanding what truly matters to users can a company correctly match the right variable reward to their intended behavior.”
Nir Eyal
Also, don’t make a reward feel constraining. Understand Reactance — the feeling of being constrained by our lack of choices when our autonomy is threatened, causing us to rebel against a behavior.
4. Investment
The more users invest time and effort into a product or service, the more they’ll value it.
We all have these 3 tendencies:
- We irrationally value the effort we’ve invested
- We seek to be consistent with our past behaviours
- We avoid cognitive dissonance (the psychological pain of two conflicting ideas)
These tendencies combine to form the process of rationalization in which we give reasons for our behaviours, past and present.
So prompting users to invest time and effort into your product causes them to post-rationalise that this effort was worthwhile, causing them to value your product higher.
eg organising music files in iTunes (I can relate to that!), building a following on social media, or improving your photoshop skills.
The investment phase helps load the next trigger, increasing the odds the user will make another pass through the Hook cycle.
So now we’re read this book we can all build habit-forming products. Yay! But remember…
