The Hook Model
The importance of habits in business
- For many companies, turning their products into habits – behaviors requiring no conscious thought – drives a lot of value. This makes loyalty as important as gaining millions of customers.
- Once a product has become a habit, it does not require extensive advertising to ensure usage; it is linked to users’ emotions and routines.
- The result is that users begin considering these products indispensable, which ensures repeated use and, in turn, continued success for the companies that manage to create such products.
- But how do successful companies actually go about creating habit-forming products? Is this all chance, or is there a technique to it? This book covers some of the key aspects that any designer or seller of a habit-forming product would do well to keep in mind.
- Hooks are a series of experiences that can together modify user behavior and encourage formation of new habits.
- As we will see, greater accessibility, more data and improved speed of delivery have increased the likelihood of hooks being employed to drive habit formation in our times.
- The hooks employed by companies essentially follow a four-phase process called the Hook Model. Successful products go through multiple cycles of these four phases to reach a refined stage where users keep coming back for more on their own, without any need for aggressive marketing by the company.
The four phases of the Hook Model are
- Trigger – External or internal cues that prompt certain behavior
- Action – Use of the product, based on ease of use and motivation
- Variable Reward – The reason for product use, which keeps the user engaged
- Investment – A useful input from the user that commits him to go through the cycle again
We will look at these four phases in greater detail in chapters after the next one, and also explore some ideas related to this whole field of user manipulation.
The Habit Zone
Benefits of habit-forming
- Getting consumers to form habits related to their products can be critical for many companies to succeed, but it is not necessary for every single company.
- For cases where it is needed, and where a company successfully manages to achieve it, habit forming can have a number of benefits. These include:
- increased customer lifetime value (CLTV) – the amount of money that the company can make from customers before they move to competing offerings
- more flexibility in raising prices or charging for premium services
- supercharged growth by word-of-mouth publicity (characterized by Viral Cycle Time – the amount of time taken by a user to invite another user)
- greater competitive edge, because the competition finds it difficult to make inroads, e.g.people continue to use the QWERTY keyboard despite better keyboards available
- But people are creatures of habits, and creating new ones requires them to forget certain old ones.
- This means that for new types of behavior to really become ingrained into our decision-making systems, they need to be reinforced again and again.
- The benefit is that once you have succeeded in turning your product into a habit, another competing product will find it tougher to displace your product, e.g. Google’s ubiquity and synonymity with Internet search has meant that products that are not particularly bad, like Bing, have failed to become as popular.