Nir Eyal
Hooked
The Hooked Model (Location 279)
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Companies leverage two basic pulleys of human behavior to increase the likelihood of an action occurring: the ease of performing an action and the psychological motivation to do it. (Location 294)
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introducing variability does create a focused state, which suppresses the areas of the brain associated with judgment and reason while activating the parts associated with wanting and desire. (Location 305)
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the investment phase isn’t about users opening up their wallets and moving on with their day. Rather, the investment implies an action that improves the service for the next go-around. Inviting friends, stating preferences, building virtual assets, and learning to use new features are all investments users make to improve their experience. (Location 317)
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this book teaches innovators how to build products to help people do the things they already want to do but, for lack of a well-designed solution, don’t do. (Location 345)
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Businesses that create customer habits gain a significant competitive advantage. (Location 363)
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Habits are one of the ways the brain learns complex behaviors. Neuroscientists believe habits give us the ability to focus our attention on other things by storing automatic responses in the basal ganglia, an area of the brain associated with involuntary actions. (Location 384)
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Fostering consumer habits is an effective way to increase the value of a company by driving higher customer lifetime value (CLTV): the amount of money made from a customer before that person switches to a competitor, stops using the product, or dies. User habits increase how long and how frequently customers use a product, resulting in higher CLTV. (Location 417)
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Some products have a very high CLTV. For example, credit card customers tend to stay loyal for a very long time and are worth a bundle. Hence, credit card companies are willing to spend a considerable amount of money acquiring new customers. This explains why you receive so many promotional offers, ranging from free gifts to airline bonus miles, to entice you to add another card or upgrade your current one. Your potential CLTV justifies a credit card company’s marketing investment. (Location 419)
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Note: CLTV should be an important metric that is considered in formulating the marketing and pricing strategies. Furthermore, altering the way the way in which products are consumed should also be explored allowing a much higher CLTV. For example, the conventional use of a product dictates that it would be used once a year and therefore then subsequent pricing and marketing strategies would be designed around how to make that proposition more attractive for the customer and dictates all such decisions. These are bound to be very similar to the competition. However, if you were to alter the use of the product by design in turn creating another USP then you are open to explore a lot more marketing strategies that would have not have been available to you. For example, you can afford to spend a lot more to as CAC relative to your competition as the CLTV has increased to monthly from annual.
Buffett and his partner, Charlie Munger, realized that as customers form routines around a product, they come to depend upon it and become less sensitive to price. (Location 425)
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Buffett and Munger understand that habits give companies greater flexibility to increase prices. (Location 428)
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in the free-to-play video game business, it is standard practice for game developers to delay asking users to pay money until they have played consistently and habitually. Once the compulsion to play is in place and the desire to progress in the game increases, converting users into paying customers is much easier. The real money lies in selling virtual items, extra lives, and special powers. (Location 429)
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As of December 2013, more than 500 million people have downloaded Candy Crush Saga, a game played mostly on mobile devices. The game’s “freemium” model converts some of those users into paying customers, netting the game’s maker nearly $1 million per day. (Location 432)
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Users who continuously find value in a product are more likely to tell their friends about it. (Location 435)
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Hooked users become brand evangelists—megaphones for your company, bringing in new users at little or no cost. (Location 437)
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Facebook’s success was, in part, a result of what I call the more is more principle—more frequent usage drives more viral growth. (Location 441)
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“The most important factor to increasing growth is … Viral Cycle Time.”7 Viral Cycle Time is the amount of time it takes a user to invite another user, and it can have a massive impact. (Location 443)
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Having a greater proportion of users daily returning to a service dramatically decreases Viral Cycle Time for two reasons: First, daily users initiate loops more often (think tagging a friend in a Facebook photo); second, more daily active users means more people to respond and react to each invitation. The cycle not only perpetuates the process—with higher and higher user engagement, it accelerates it. (Location 447)
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“many innovations fail because consumers irrationally overvalue the old while companies irrationally overvalue the new.” (Location 456)
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Gourville claims that for new entrants to stand a chance, they can’t just be better, they must be nine times better. Why such a high bar? Because old habits die hard and new products or services need to offer dramatic improvements to shake users out of old routines. (Location 457)
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Gourville writes that products that require a high degree of behavior change are doomed to fail even if the benefits of using the new product are clear and substantial. (Location 459)
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QWERTY survives due to the high costs of changing user behavior. (Location 466)
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users also increase their dependency on habit-forming products by storing value in them—further reducing the likelihood of switching to an alternative. (Location 470)
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Ultimately, user habits increase a business’s return on investment. Higher customer lifetime value, greater pricing flexibility, supercharged growth, and a sharpened competitive edge together equal a more powerful bang for the company’s buck. (Location 475)
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Altering behavior requires not only an understanding of how to persuade people to act—for example, the first time they land on a web page—but also necessitates getting them to repeat behaviors for long periods, ideally for the rest of their lives. (Location 480)
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Habits keep users loyal. (Location 503)
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For an infrequent action to become a habit, the user must perceive a high degree of utility, either from gaining pleasure or avoiding pain. (Location 513)
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A company can begin to determine its product’s habit-forming potential by plotting two factors: frequency (how often the behavior occurs) and perceived utility (how useful and rewarding the behavior is in the user’s mind over alternative solutions). (Location 532)
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one aspect is common to all successful innovations—they solve problems. (Location 556)
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“Are you building a vitamin or painkiller?” (Location 557)
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Painkillers solve an obvious need, relieving a specific pain, and often have quantifiable markets. (Location 562)
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Vitamins, by contrast, do not necessarily solve an obvious pain point. Instead they appeal to users’ emotional rather than functional needs. (Location 565)
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A habit is when not doing an action causes a bit of discomfort. (Location 579)
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My answer to the vitamin versus painkiller question: Habit-forming technologies are both. These services seem at first to be offering nice-to-have vitamins, but once the habit is established, they provide an ongoing pain remedy. (Location 582)
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forming strong user habits can have several business benefits including: higher customer lifetime value (CLTV), greater pricing flexibility, supercharged growth, and a sharper competitive edge. (Location 607)
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Habits cannot form outside the Habit Zone, where the behavior occurs with enough frequency and perceived utility. (Location 609)
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Habit-forming products often start as nice-to-haves (vitamins) but once the habit is formed, they become must-haves (painkillers). (Location 610)
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Types of External Triggers (Location 673)
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1. Paid Triggers (Location 674)
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2. Earned Triggers (Location 680)
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3. Relationship Triggers (Location 684)
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Relationship triggers can create the viral hyper-growth (Location 687)
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PayPal knew that once account holders started sending other users money online they would realize the tremendous value of the service. (Location 690)
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Proper use of relationship triggers requires building an engaged user base that is enthusiastic about sharing the benefits of the product with others. (Location 695)
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4. Owned Triggers (Location 697)
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Without owned triggers and users’ tacit permission to enter their attentional space, it is difficult to cue users frequently enough to change their behavior. (Location 703)
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product designers must know their user’s internal triggers—that is, the pain they seek to solve. Finding customers’ internal triggers requires learning more about people than what they can tell you in a survey, though. It requires digging deeper to understand how your users feel. (Location 754)
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The ultimate goal of a habit-forming product is to solve the user’s pain by creating an association so that the user identifies the company’s product or service as the source of relief. (Location 757)
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You’ll often find that people’s declared preferences—what they say they want—are far different from their revealed preferences—what they actually do. (Location 767)
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Jack Dorsey, cofounder of Twitter and Square, shared how his companies answer these important questions: “[If] you want to build a product that is relevant to folks, you need to put yourself in their shoes and you need to write a story from their side. So, we spend a lot of time writing what’s called user narratives.”10 (Location 774)
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Dorsey believes a clear description of users—their desires, emotions, the context with which they use the product—is paramount to building the right solution. In addition to Dorsey’s user narratives, tools like customer development,11 usability studies, and empathy maps12 are examples of methods for learning about potential users. (Location 782)
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One method is to try asking the question “Why?” as many times as it takes to get to an emotion. Usually, this will happen by the fifth why. This is a technique adapted from the Toyota Production System, described by Taiichi Ohno as the “5 Whys Method.” (Location 786)
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Triggers cue the user to take action and are the first step in the Hooked Model. (Location 827)
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Triggers come in two types—external and internal. (Location 828)
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External triggers tell the user what to do next by placing information within the user’s environment. (Location 829)
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Internal triggers tell the user what to do next through associations stored in the user’s memory. (Location 830)
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Negative emotions frequently serve as internal triggers. (Location 831)
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To build a habit-forming product, makers need to attach the use of their solution to a frequently felt internal trigger and know how to leverage external triggers to drive the user to action. (Location 832)
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Fogg posits that there are three ingredients required to initiate any and all behaviors: (1) the user must have sufficient motivation; (2) the user must have the ability to complete the desired action; and (3) a trigger must be present to activate the behavior. (Location 859)
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The Fogg Behavior Model is represented in the formula B = MAT, which represents that a given behavior will occur when motivation, ability, and a trigger are present at the same time and in sufficient degrees.1 (Location 862)
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Fogg states that all humans are motivated to seek pleasure and avoid pain; to seek hope and avoid fear; and finally, to seek social acceptance and avoid rejection. (Location 876)
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Consequently, any technology or product that significantly reduces the steps to complete a task will enjoy high adoption rates by the people it assists. (Location 915)
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Traditionally, registering for a new account with an app or Web site requires several steps. The user is prompted to enter an e-mail address, create a password, and submit other information such as a name or phone number. This burden introduces significant friction that discourages users from signing up. (Location 973)
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Many companies have eliminated several steps in the registration process by enabling users to register with their sites via their existing Facebook credentials. (Location 976)
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The examples above show how simplicity increases the intended user behaviors. (Location 1018)
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for companies building technology solutions, the greatest return on investment generally comes from increasing a product’s ease of use. (Location 1025)
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Make your product so simple that users already know how to use it, and you’ve got a winner. (Location 1029)
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the page has two very clear calls to action: sign in or sign up. The company made the desired action as simple as possible, knowing that getting users to experience the service would yield better results than trying to persuade them to use it while still on the home page. (Location 1047)
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The mind takes shortcuts informed by our surroundings to make quick and sometimes erroneous judgments. (Location 1091)
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The Anchoring Effect (Location 1102)
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People often anchor to one piece of information when making a decision. (Location 1108)
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The study demonstrates the endowed progress effect, a phenomenon that increases motivation as people believe they are nearing a goal. (Location 1119)
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Sites such as LinkedIn and Facebook utilize this heuristic to encourage people to divulge more information about themselves when completing their online profiles. On LinkedIn every user starts with some semblance of progress (figure 18). The next step is to “Improve Your Profile Strength” by supplying additional information. As users complete each step, the meter incrementally shows the user is advancing. Cleverly, LinkedIn’s completion bar jump-starts the perception of progress and does not include a numeric scale. For the new user, a proper LinkedIn profile does not seem so far away. Yet even the “advanced” user still has additional steps she can take to inch toward the final goal. (Location 1120)
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Habits help us conserve our attention for other things while we go about the tasks we perform with little or no conscious thought. (Location 1202)
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