How to Create Habit-Forming Products

Jun 17, 2023

#290 Episode Summary:

In this Episode, you’ll Discover How to Build Habit Forming-Products, How To Create Desire, Engagement and more with Nir Eyal.

Nir Eyal is a best-selling author and writes, consults, and teaches about the intersection of psychology, technology, and business. He’s the founder of two tech companies, an active investor in habit-forming technologies, and taught at the Stanford Graduate School of Business and the Hasso Plattner Institute of Design at Stanford.

Here’s a glance at what you’ll discover in this episode:

  • How Twitter, Instagram, and Facebook build addictive products and services
  • Nir explains the 4 steps you need to build habit-forming products
  • How to get people so hooked on your product that they won’t stop using it even if a “better” product comes along
  • Put these 3 types of rewards into your products to make them irresistible
  • The Power Of The Unknown: How to manufacture desire and engagement
  • We’ve all seen how the products we use can have a profound impact on our day to day lives.
  • Habits are things we do with little to no conscious thought. 40% of things you do every day are based on habits. (1:11)
  • Companies use the “Hook” to get consumers to form habits. “The hook is an experience designed to connect the consumer’s problem with the company’s product with enough frequency to form a habit.”  (1:44)
  • “It is through successive cycles through these hooks that customer preferences are shaped, that our tastes are formed, and that these habits take hold. “(1:53)
  • “Hooks have 4 basic steps; a trigger, an action, a reward, and an Investment.”  (2:03)
  • Triggers
    • External triggers are something that tells us what to do next, like “buy now”, “click here”. (2:09)
    • Internal triggers are things that tell the user what to do next, but where the information for what to do is stored as a memory or an association inside the user’s head. (2:37)
    • Negative emotions are the most powerful triggers. “People suffering from depression check email more.” (3:09)
  • Action
    • The simplest behavior is done in anticipation of a reward. It’s as easy as a scroll on Pinterest, pushing play on YouTube. (4:44)
    • B.J. Fogg’s rule of behavior: When there is sufficient motivation + sufficient ability + a trigger = predictable behavior. Every action requires these three things. (5:13)
    • “The easier something is to do, the more likely we are to do it.” (6:08)
  • Reward starts in the brain. How do we manufacture desire? The unknown is fascinating. B.F. Skinner says a variable reward causes increased focus and engagement. (6:23) Three types of rewards:  
    • Rewards of the tribe come from other people – social media.(7:56)
    • Rewards of the hunt: having to do with the search for resources or information – slot machines, online feeds, twitter. (8:23)
    • Rewards of the self: things that feel good, but don’t come from other people or have information attached. Things that are intrinsically pleasurable such as the search for mastery, consistency, competency and control – Gameplay, Candy Crush, email, to-do list, app notifications. (9:21)
  • Investment is something the user does to bring them back. Increases the likelihood of the next pass through the hook through storing value. (10:31)
    • Habit-Forming Products appreciate in value – they get better with use. Google drive, Mint, Pinterest, Twitter all get better the more you put into them or use them. (11:03)
    • “ Reputation is a form of stored value that users can literally take to the bank.”  (11:25)
    • Reputation dictates what you can charge, makes it less likely that people will leave, EVEN if a better product comes along. (11:31)
    • “It’s the product that can capture a monopoly of the mind that can hold on to the market.”(12:06)
  • Key: How can we take the lessons from these “best of breed” companies to apply to our own businesses? (13:23)
  • I think that if we’re smart, we can apply these very same tactics to all our businesses; to help our customers and users live happier, healthier, more productive, more connected lives. (13:55)
  • “I truly think that we can use habits for good.” (14:07)

by Joe Polish
Founder of Genius Network

Joe Polish

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