Lessons from Nir Eyal: ‘Habit Forming Products’

On May 25th, 2015 at ‘The Art of Marketing Conference’ in Toronto, ON,  we were introduced to Nir Eyal who spoke to us about forming habits through technology. Nir described a habit as “being impulses to do behaviours with little to no conscious thought.” Habit-forming products have hooks.

Nir writes, consults, and teaches about the intersection of psychology, technology, and business. He uses his experience to help companies create behaviours that benefit their users, and help create healthful habits in their own lives. Nir has founded two tech companies, taught at Stanford Graduate School of Business ,and is the author of the bestselling book ‘Hooked: How to Build Habit-Forming Products.’ He also writes on his blog NirAndFar.com, and for TechCrunch, Inc., and Psychology Today.

Habit forming technology has had and will continue to have a profound impact on our daily lives. Companies that have changed lives of hundreds of millions of people have been extremely successful – for example - Facebook, Twitter, GetHub, and YouTube. They have been able to change our day-to-day habits so the questions that beg are:

  1. How do they do it?
  2. How can this impact your business?                                                                                                                                                                                                                                                                                                                            

Let’s have a deeper look.

Habits are simply an impulse to do a behaviour with little or no conscious thought. So, why is this important? Think about it, so much of what we do in our daily lives (40% of what we do) is a habit.  At the “Core” of habits – is what Nir identifies as the “Hook”. 

The companies that have been successful creating habits generate experiences designed to connect users problems to their solution with enough frequency to form a habit. They have been successful at shaping customer preferences and forming tastes – this is how habits take hold.

Nir identified that hooks have four (4) parts.

1. Trigger 2. Action 3. Reward 4. Investment

The Trigger Phase

A “Trigger” is a call to action and tells us what to do next and comes in two (2) types: an internal trigger and an external trigger. Think about the impact this can have on your business development with customers if you can provide a relevant trigger!

External triggers are more of what we are used too - they prompt us to action. Examples can be a “click now button”, a “play now button” or a friend telling us about something to download or a client referring us.  

Internal triggers tell the user what to do next, and the information isn’t the trigger but it is stored as a memory/association to the users mind. The keys to internal triggers are emotions. Emotions lead to particular actions. The most frequent internal triggers are negative emotions. Negative emotions prompt us to act. Our brains are good at pattern matching; it knows what brings relief to pain points. The brain learns what provides relief. For example, what do you do when you experience ‘boredom”?  Many people will check email, YouTube, etc. You then associate these with this trigger.

What impact can triggers have for your products or services?

Well, they can help you build better products and services to win more business. Success relies on understanding what Nir describes as the users “itch". In order to help people live better, it’s imperative to not just tell them the functional requirements of your product or service but to be able to connect with them about the psychological requirement – this is what scratches the users itch.

The Action Phase 

E=MAT

This is the simplest behaviour done in anticipation of reward.  Actions are very simple behaviours like a scroll on Pinterest, or searching on Google, or pressing the play button on YouTube. If the user is not using or activating with you - you must ask yourself is it easy for the user to use? Does the user have motivation to use it? And is there a trigger to tell us what to do?

Motivation is the energy for action; it is how willing we are to do a particular behaviour. There are 6 basic levers to increase motivation – seek pleasure, avoid pain, have hope, avoid fear, seek social acceptance, and avoid social rejection. These six levers are popular within advertisement. An Ad Copy uses 1 or more of these six levers.  

Ability is the capacity to do a particular behaviour – is it easy to do? Ability involves time, investment, effort needed, and brain cycles. If your product or service is difficult to understand – it is less likely behaviour will occur. The best predictor of what you do tomorrow is what you did yesterday. It’s easier to do in the future the more we do it and the easier it becomes. This is also called practice.

Trigger (as discussed in previous section) is if people are not doing a specific behaviour but they have the motivation and sufficient ability to do so – you need a trigger to cross the threshold. If a trigger is present, behaviour will occur. 

Source: Brillance

 

The Reward Phase

Where the users itch is scratched.

There are three stages in the Reward Phase. First, is the Reward of the Tribe – which is a feel good. It comes from other people, empathetic, joy, partnerships, and cooperation. You can achieve this from social media. There is a high degree of variable emotions. Second, is the Reward of the Hunt – which is the search for resources. They feel good when you hunt and find them. This can be related to casinos. When you play slot machines, you keep pulling that lever to see if the next turn will be your jackpot! It’s also like twitter – in a sense, you keep looking at old posts thinking that the next one will be better than the last.  Lastly, is the Reward of the Self – this is the feel good that doesn’t come from anyone other than you. It is intrinsically pleasurable – Candy Crush for example is a part of this stage. As you play on your own, you get a feel good reward getting to the next level!  If you don’t play games, you may get these rewards by checking something done on your to do list, or clearing all your unread notifications.

Think of the following points:

  • Is the reward fulfilling, yet leaves the user wanting more?
  • Is there a stress of desire? – the anticipation of a reward – supercharge this response  - delay – unknown – uncertainty – increases focus
  • A bit of the unknown is fascinating!
  • Uncertainty increases focus, and engagement
  • Crave

The Investment Phase

This is where the user puts something into the product they are interested in/using. They put something into it in anticipation of future benefits. (Action phase – immediate) Investments are loading the next trigger for the user. When you send a message to someone there are no immediate benefits, but you are waiting for a reply, which then has an external trigger by sharing a notification.

  • Storing value – the more we use of something, the less value it becomes – the key is habit-forming tech should appeal in value – AND – become better with use, not less appealing. For example, think of an iPod or the content in iTunes – the more inventory you have (the more data to platforms) – it becomes more of a value to you. Another example is the number of Followers you might have on Twitter – stored value)
  • Reputation is stored value – what you can charge?

Give the user what they want but, you need to leave some mystery so that they want more. You often see that it isn’t the best product to win, but the one that sticks out the most is the one that attracts the customer’s preferences.

The stickiest wins and that’s when preferences are shaped, tastes formed, and habits take hold.

Now, it’s important to understand that not every model needs a habit – many companies, products, and services are doing very well without a habit forming. It is important to consider the implications for your business if you bake some of these thoughts into your plans.

 

What I’ve learned from Nir is:

  1. The companies that have been successful create experiences that connect users problems to their solution with enough frequency to win business – that’s what I strive for everyday with BLUEPRINCE.
  2. Business Development Success relies on understanding your users “itch“. Day in and day out I see sales people always talking about functional requirements of their product or service - connect with them about the psychological requirement – the emotion– this is what scratches the users itch.
  3. With everything you present - is it easy to understand? When services are implemented are they easy to use, follow, and understand?

My challenge to you is to explore how you can change your approach using the elements of the hook to win more business.

Make it a great day!

 

 

At BLUEPRINCE, 

“We empower people and teams to thrive."

Working with some of the world’s best-known companies and small - midsize family run businesses we provide tools and training to help people thrive professionally and personally. Helping people grow drives overall growth. In addition to managing, inspiring and coaching an outsourced sales team for a Fortune Top 35 client, we recently we helped a client communicate and relay his vision and mission to his franchisee ownership team resulting in a unified corporate sale of his company. We also helped a family run business create a customized sales process with coaching to significantly exceed revenue targets.

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