Hooked: How to Build Habit-Forming Products [Summary]

Hooked: How to Build Habit-Forming Products by Nil Eyal discusses how some of the world’s most successful products, like smartphones and social networking apps, make us form habits around them and why that’s crucial to their success, before teaching the 4-step framework that lies behind them.

The Hook Cycle

1. Trigger

   • Prompt the user to take an action.

   • 2 kinds

     • Internal - “feeling bored” → Open Instagram
     • External - Ads, emails
   • The idea is to use external triggers, form a habit and make the use of our product to be prompted by internal trigger

2. Action

   • Trigger leads to a reward through an action
   • The action has to be as streamlined, delightful, and simple as possible.
   • Eliminate as many steps between the trigger and reward as possible.
   • The goal is to make this action a habit.
   • Doing something out of habit means doing it without even thinking.

3. Variable reward

   • User takes an action in hope of receiving a reward - something entertaining, something useful.
   • The important thing here is variable. If it’s the same reward everytime, the law of diminishing returns kicks in and the action is never turned into a habit.

4. Investment

   • Make the user work a little and store some sort of value in the product - upload their pictures (action) to connect with their friends (reward)
   • This is also known as The Ikea Effect

Why is this important?

1. Charge premium price for a more engaging product.
2. Increase your customer lifetime value (CLV).
3. Increase your growth rate via organic channels like word-of-mouth.
4. Develop a stronger competitive advantage with the combined effect of the previous points.

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