Hooked Book Summary – Nir Eyal and Ryan Hoover

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Synopsis

Why do we check Facebook every morning when we wake up, but people only use our product once? Hooked provides the psychology underpinning habits and how this applies to some of the most successful companies’ products. Each of these products utilizes what Nir Eyal calls the Hook model. The Hook Model associates people’s emotions and routines with a product. These connections draw the consumer back time after time, allowing the company to save money on no longer having to buy expensive advertising. Hooked provides insight into how you can form habits around your products by using technology, business, and psychology knowledge. 

About Nir Eyal

Nir writes, consults, and teaches about the importance of psychology and technology in business. Nir has founded and sold two companies since 2003. Additionally, he has taught at the Stanford Graduate School of Business and the Hasso Plattner Institute of Design. Nir runs a popular blog on NirAndFar.com and frequently writes articles for The Harvard Business Review and Psychology Today.

It’s Difficult to Change or Replace Established Habits

We all develop habits over time. Our habits are what make it so difficult to quit smoking as a new year’s resolution. We build habits tied to our everyday lives, which makes it so difficult to shift away from them. 

Habits are activities that we engage in with no conscious thought. Psychologically, habits are vital energy- and time-saving shortcuts for our brains. As our brains are always looking to increase their efficiency, we often do whatever worked last time. This then leads to us repeating behaviors over and over again.

Habits are challenging to change permanently. Nir Ayal provides examples of research showing that changing our routines will not remove the neural pathways associated with that routine. The neural pathways of the old habit remain in our brains and are ready to be easily reactivated. For example, ⅔ of alcoholics are drinking again within a year of a detox program. 

Nir provides guidance on ways you can succeed in adopting a new habit. Firstly, repetition is key. The more you repeat a behavior, the stronger the neural pathways formed in your brain. Nir provides the example of a study that found that students who flossed their teeth regularly were more successful in continuing with this habit than those who were told to only floss rarely. 

Without repetition, the habit you are seeking to adopt has to have massive value for you. You have to believe that this new habit will have a significant impact on your life. One habit which isn’t frequent but still occurs due to its great value is our use of the retailer Amazon. Although we don’t use Amazon every day, it is still a habit to shop from Amazon rather than other online stores. Amazon’s direct price comparison of multiple items is so useful that we all make a habit of shopping there, even if it is infrequent.

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Create Products That Are Habit-Forming

The most successful businesses and products in the world are those that are habit-forming. Habit-forming products have a knack of making their way into our daily routines. A perfect example of this is our smartphones. Smartphones play a considerable part in our lives. For most people, it is a habit to check our phones for notifications and messages. 

Nir outlines some of the advantages of selling habit-forming products:

• They attract long-term customers. As habits are challenging to get rid of, your customers are likely to become repeat customers. These customers are of greater value based on the total cash flow they will produce. As an example of this, Nir talks about how Facebook’s popularity came from the habits people built around the platform. Then, once these customers invited friends, further habits were produced. Facebook was no longer a short-term tool but a long-term habit.
• Habit-forming products have a strong competitive position. The strength of these products is reinforced by how difficult it is to remove a habit. Once a customer has formed a habit around your product, a competing product will have to be significantly better than your product. Nir uses the example of QWERTY keyboards to showcase this point. Although many more intuitive and effective keyboard layouts have been introduced, people still prefer using the QWERTY layout. This isn’t because this layout is better; it is just because they now have a habit of typing on this layout.
• Habit-forming products have greater price flexibility. When customers have a habit of using your product, they develop a dependency. This dependency is often strong enough to withstand price changes. For this advantage, Nir talks about online games that start as free-to-play. Players make a habit of playing this game. Then, once the free-to-play option expires, they are willing to pay to continue.

The Four-Staged Hook Model

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Nir introduces the Hook Model as a cycle that can be utilized to successfully make your company’s products habit-forming. The Hook Model consists of four steps which have to be repeated continuously. After repetition, the users will start to form a habit around your products. 

1. The Trigger – There needs to be an external event that encourages a consumer to use your product for the first time. A common trigger is an engaging TV commercial.
2. The Action – The action relates to what has to be done for the consumer to use this product. For example, ordering a subscription or joining an online community
3. The Reward – This consumer should then obtain fulfillment when engaging with this product. Specifically, this product should fulfill the needs the consumer expected to be met when they experienced the trigger. 
4. The Investment – The consumer will have invested something of value to use your product. This might be time, money, personal data, or information.

Importantly, this model is a cycle. After the final step, the consumer is led back to the start of the cycle. The four steps are then repeated over and over until a habit starts to form. The consumer will start to develop their unique internal triggers instead of external ones. These consumers will then have an impulse to use your product without the need for external influences. 

Consumers’ internal triggers will continue to get stronger until their engagement with your product is no longer conscious. They do not even have to think about using your product. Instead, they will just do it. At this point, the cycle has become an unstoppable chain reaction that will be extremely difficult to change. 

This model outlines an interesting feature of how our long-term behaviors are formed. Most importantly, understanding these behaviors can help your business be successful. The following sections will take a closer look at each of the steps of the Four-Stage Hook Model.

External Triggers

Habits require a spark to kickstart the cycle proposed by the Hook Model. People do not wake up one day and decide they want to use your product. There has to be an external trigger that encourages this potential consumer to become a genuine consumer. The most common external triggers are advertisements, targeted or generic, and word of mouth from friends or family. 

External triggers are necessary for products to become part of a consumer’s habits. Nir describes these external triggers as calls-to-action and can take various forms. For example, some businesses may adopt traditional advertising to try and lure new customers. Alternatively, companies like Facebook rely on viral dynamics. After creating one customer who has made Facebook a habit, a chain-reaction is started. Word of mouth spreads the product’s reach far and wide. Subsequently, one external trigger creates millions of external triggers for other people. 

Nir explains that triggers can only be effective if they give the consumer a simple choice of actions to take. Consumers do not react well to overly-complicated external triggers. Therefore, it is unlikely that a consumer will engage with your product if you use complicated and confusing external triggers. Nir provides an example to explain this point. Imagine you want to join a social networking site, but the registration form takes an hour. This kind of obstacle will significantly reduce the likelihood that your product will be used, let alone become a habit. Therefore, a simple trigger should always be prioritized over a complex trigger.

Internal Triggers

As previously stated, the frequency at which we use a product over time is crucial for habit production. Companies cannot rely solely on external triggers pushing consumers to use their product consistently. This would be expensive and dependent on chance. Hence, internal triggers are a hugely important part of creating habit-backed products. 

Nir explains that we usually use products to solve the problems that we have. More often than not, these problems relate to avoiding pain or seeking pleasure. For example, think about the reasons for us buying food, clothes, or smartphones. Each of these items provides us with pleasure: we enjoy the taste of food, enjoy wearing clothes that suit our personality, and smartphones provide us with entertainment and the opportunity to build communities. However, these items also help us avoid pain, such as hunger, coldness, and social disconnection. 

The key to producing internal triggers is encouraging consumers to make a mental connection between your product and a desired solution. This desired solution should either be the avoidance of pain or the seeking of pleasure. Once this mental connection is formed, you have an internal trigger with a positive association, as the product helped solve a problem. 

Nir explains that the most powerful internal triggers are negative emotions. We are more likely to seek out habitual problem-solving products when we are experiencing negative emotions. For example, many of us have internal triggers for social networks and smartphones. These triggers range from boredom to the stress of living in uncertainty. Subsequently, we build habits that help us forget about these emotions or change them into positive ones.

Internal triggers produce an impulse in consumers to use the product more and more often. However, internal triggers are only cues that encourage consumers to use your product. Motivation is still required to make a product a habit.

Every Product Needs a Motivation

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A trigger alone is not sufficient to generate action in consumers. Nir explains that people only take action if three preconditions are met: A trigger, a motivation, and the capability. Triggers are required, but consumers also need to have the motivation to engage with your product. Hence, Nir recommends that companies increase the motivation associated with their products. 

The most accessible motivation that a company can attach to their product is the user’s ability to use the product. Do not attempt to increase the users’ motivation through unreasonable benefits. Instead, you are more likely to attract customers if a product is easy to use and cheap. Nir recommends simplifying the steps needed to use your product and providing consumers with the outcomes that they desire from your product. Emotions will always be a vital motivating factor, so you should tap into our human drives. Utilize emotion-grabbing advertisements to increase the likelihood of customers using your product. Specifically, focus on emotions related to pleasure.

Utilize Variable Rewards

Motivation is vital in helping encourage customers to try a product. However, we cannot maintain this motivation without producing the results the customer wants. For customers to use a product frequently, a foundation of habit-building, the product must work every time it is used. In effect, the product must reliably deliver on what it promises. 

Despite consistent results being critical, you will also want to make use of variable rewards. Studies have shown that our craving for rewards causes a stronger emotional reaction than receiving the reward itself. Thus, anticipation is essential when trying to encourage consumers to form a habit out of your product. If the reward received is predictable, then customers won’t be as excited by the product. Therefore, you want consistent rewards of varying degrees. Variable rewarding is an approach often adopted by social media platforms. Twitter and Facebook present you with a combination of photos, videos, posts, and polls. While scrolling through these feeds, you can never predict what will come up next. This unpredictability is what brings customers back again and again to these social media platforms.

Finally, as well as providing variable rewards, these rewards should always relate to the user’s initial motivation to use the product. Nir provides the example of online question-and-answer forums to showcase this point. People usually start contributing to question-and-answer forums, like Quora, because they crave the reward of social recognition. When some sites attempted to offer them cash rewards, they found that these rewards were not effective. These rewards were no longer in line with the users’ original motivation.

Customer Investment Encourages Habits

Customers can invest time, effort, money, or even personal data into your product. Once they have invested one of these into your product, they are more likely to use your product again. Research suggests that we place more value on things when we have invested. For example, one study showed that we place more value on something that we made with our own hands than something directly comparable made by somebody else. Similarly, suppose you have built a social network community and profile filled with photos with memories. In that case, you will value the old social network more than a new social network.

Secondly, humans try to be consistent in their behaviors. Studies show that what we’ve done before tends to be a pretty good predictor of what we will do in the future. Hence, if we feel we’ve invested in a product by using it frequently, we’ll likely keep using it in the future.

Finally, we tend to adjust our world-view to suit our behavior, after which that new world-view will then generate more of said behavior. Nir provides the example of the first times we would have tasted beer or wine. It is unlikely that we enjoyed the flavor, but we kept trying it as others enjoy drinking alcohol. Slowly you get used to the flavor of the alcohol and actually enjoy it. This example is your behaviors influencing your preferences. The same thing can happen with investment in a product. Investments change our preferences, and eventually, we become dependent on the product.

Habit-Building Products Should Be Done Responsibly

This book is based around the idea of getting people hooked on a product. However, the first thing that comes to mind when the word hooked is used is addiction. Therefore, Nir emphasizes the importance of companies using the Hook Model responsibly. Irresponsible habit-building is merely manipulation. 

Nir suggests that companies ask themselves two questions to identify whether they are habit-building responsibly or irresponsibly:

• Does the product enhance the users’ lives?
• Would the entrepreneur use the product themselves?

If the answer to both of these questions is no, then it is highly likely that your company is engaging in irresponsible habit-building. 

Every company has a responsibility for how their product affects their customers. However, this effect is exaggerated when utilizing the Hook Model. Therefore, companies have to be especially careful that they make ethical decisions when aiming to implement the Hook Model. 

Know Your Product and What Your Customer Wants

Every entrepreneur wants to create a product that people want to use over and over again. Having repeat customers is impressive and also brings economic benefits. However, to implement the Hook Model, you have to know your product and your customers.

Firstly, you need to ask yourself the question of whether your product should be habit-forming. Not all new products need to be habit-forming to make you lots of money. Therefore, always start by asking yourself whether this product needs to be habit-forming. For example, life insurance is a one-off purchase. There is no point in wasting your time trying to get people hooked on purchasing life insurance. There are other ways of obtaining customers for life insurance than habit-building. Hence, only pursue habit-forming for products that rely on users’ constant and frequent engagement. 

Once you have decided to create a habit-forming product, you will need to analyze your customers’ needs, as well as the benefits your product offers. You need ensure that your product is meeting your customers’ needs. Your product has to be solving your users’ problems frequently enough that it becomes a habit. Additionally, understanding your customers’ needs is vital for adjusting the triggers and rewards you incorporate into your Hook Model. 

Suppose you are looking to upgrade or enhance an existing product and turn it into a habit-forming product. In that case, you should take a slightly different approach. Firstly, you should identify your existing habitual users. Then, identify where their habit developed. You can then spot similarities between them and potential customers. 

Concluding Point

Try to connect your product’s offering to your customers’ needs and frequently lead them through the Hook Model. If you manage to do this, you have the opportunity to be extremely successful.

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