Building Habit-Forming Products with Nir Eyal, the Author of "Hooked"

Courtland Allen 7s

What's up everyone, this is Courtland Allen from IndieHackers.com, where I talk to the founders of profitable internet businesses.

Today I'm talking to Nir Eyal, a serial entrepreneur and author who is perhaps best known for his book. It's called Hooked: How to Build Habit-Forming Products. I've read the book a couple of times now, and I thought it was great. If you haven't read it yet, I'm betting that by the end of this episode, you'll want to go out and grab a copy. As the title implies, it's all about how to build habit-forming products that keep users coming back on a regular basis, and who among us doesn't want to know how to do that?

Nir is an expert in this area, obviously, and I had more than a few questions after reading his book, so it was very illuminating to be able to sit down with him and ask him questions about how entrepreneurs can best take advantage of what we know about habit formation. He breaks down the exact processes behind how companies like Facebook are able to keep users hooked on their products, and also the science underlying it, which I personally find very interesting.

We also get into a discussion about the ethical issues surrounding the entire topic. As you can imagine, the things that we know about the brain today, and about habit formation, can be used for both good and bad. There's a lot of important discussion to be had about the gray area between the two, so I really wanted to pick Nir's brain on the subject.

Anyway, I had a lot of fun recording this episode, Nir is a super smart guy with a lot of insightful and practical knowledge for entrepreneurs to use, and I hope you guys enjoy hearing what he has to say as much as I did.

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I'm here with Nir Eyal, Nir welcome to the podcast and thanks for coming on.

Nir Eyal 1m 34s

My pleasure, thanks for having me.

Courtland Allen 1m 36s

No problem, I'm excited to have you on.

You're the author of Hooked: How to Build Habit-Forming Products, and you've also got a blog at NirAndFar.com, where you write about habits and what you call "behavioral design": the intersection of psychology, technology and business.

I think this combination of factors is just about as important as any other field of study today, especially if you judge based on where we spend our time, making habitual use of products like Facebook and Twitter and all sorts of other things, and staring at our phone. And it's certainly relevant to the audience listening in right now, who are mostly aspiring entrepreneurs with dreams of building products that people love, and make habitual use of.

Rather than diving directly into your book, I'd love to have you describe your background, and how exactly you developed this particular area of expertize.

Nir Eyal 2m 23s

Sure, so, my background is that I started a couple of tech companies and exited both. The last company was at the intersection of gaming and advertising.

I had this really interesting vantage point to see a lot of companies kind of come and go in these two industries of advertising and gaming, and these are frankly two industries that are dependent upon mind control. They are dependent upon influencing people's behavior. Advertising's all about influencing human behavior and game design, and there's probably no industry that understands how to get people to do things better than the gaming industry.

At the vantage point between these two industries I learned a lot of these patterns, if you will, of how to influence behavior through digital interfaces. When my last company was acquired and I had some time on my hands I really wanted to focus on, "What is it about these products that brings people back, and how do products and services influence our behavior?"

When I went out there to try and find those lessons, I didn't find any book, I didn't find any guide for how to do it, and so I decided to write my own, so that I could, frankly, answer these questions for myself. But also so that I could provide a guidebook for all sorts of companies out there that are trying to change human behavior for good. I think that there's a real deficit out there of people building products and services in ways that effectively change human behavior.

There's a lot of people trying to. They're building products and services that could improve people's lives, if they were designed properly, and I think that's a real disaster that we don't have enough people who understand these techniques. It's not just social networks, it's not just gaming companies, but it's all sorts of companies that are using these techniques for good.

Courtland Allen 4m 8s

You mentioned wanting to provide a guidebook to help other people change human behavior for good, but the research that you started doing and the writings came in the form of your blog. How did you decide to turn your blog and your writings into an actual book, and what was that process like?

Nir Eyal 4m 22s

Yeah, I never set out to write a book. I was just writing a bunch of blog posts about what I was learning, and what I was learning was based on what I wanted to know, frankly, and so I just kept writing these blog posts trying to answer my own questions.

I spent a lot of time in the Stanford library. I spent a lot of time talking to practitioners in Silicon Valley who were building these products and services that really amazed me like Facebook and Twitter and Instagram and WhatsApp and Slack. I mean these companies do such an amazing job of bringing us back that I really wanted to kind of discover their secrets on a psychological basis.

I started just sharing what I was learning through these blog posts. Then I started getting requests from folks, like hey, I want to share this with my team, "Do you have a PDF you can share with me about the stuff that you've learned? You know tell me how do I share what you're writing about in a way that people can understand?" I got requested from my blog readers to write the boo. After about two years of blogging I decided to put together the book into what I thought would be a little PDF, but ended up becoming over 200 pages.

Courtland Allen 5m 24s

I've heard of a lot of startups that start that way, where someone's doing something, maybe as a hobby or just as something that they enjoy doing, and people say, "Hey, I would love to pay for something like this," but I've never heard of a book starting that way.

Nir Eyal 5m 36s

Yeah, it was great actually. I self-published the book at first, thinking okay, maybe a few people would want to see it. And then the book kind of took a little life of its own when it started getting a bunch of reviews on Amazon, a bunch of five-star reviews. It wasn't until that started happening that I actually got a call from a publisher, and from book agents, asking to publish it for real.

Courtland Allen 5m 58s

That's awesome, and that must have felt great to have a publisher reach out to you. Between this phase of people on your blog knowing about your book and you getting all these five-star reviews on Amazon, what kinds of things did you do to market your book?

Nir Eyal 6m 10s

Not much. I was giving talks, I lived in San Francisco and I was getting out there into the product design and tech community and giving talks about the subject matter of the book, but not too much more than that.

Courtland Allen 6m 23s

Yeah, it's interesting. I want to get into the discussion of the book itself, but… in a way, writing a book and getting the word out about it, especially if you self-publish is I'm sure full of the same lessons and challenges as starting a company, and getting the word out about a product that you built.

Nir Eyal 6m 40s

Yeah, there are a lot of parallels.

I think one of the things that I did that helped a lot was that I involved my blog readers. One thing that I did was I invited all my blog readers to read a very early version of the book, and then leave comments about what they thought of the book in a Google Doc. And so, 900 people actually signed up to be contributors, and they helped me edit the book, and so this did a few things.

The deal was, if you helped me edit my book, then I would list your name in the back of the book. To this very day there are about three pages of names at the very very back of the book of everybody who helped me.

This was tremendous in that, number one, the book got way better. As an author, or as, well, the parallel here is to a startup entrepreneur. If one customer complains, or in my case one reader complains, and says "Hey, what you wrote here doesn't make sense," well then that's your opinion versus my opinion. But when 25 people say, "This is stupid, this doesn't make sense, or your product sucks," then you can actually start to do something about it and change your product, and so that's what I did. The book got so much better because I involved people and asked them to help me.

But then, the other unpredicted benefit was that these people were my most devoted fans. When the book actually came out and then I told them, these 900 people, "Hey the book that you helped edit is now being published, I'd love it if you got a copy but can you help spread the word," well of course those were my most helpful fans who really helped me get the word out about the book. It was great.

Courtland Allen 8m 12s

Yeah, I think that's a lot of authors' dream actually, to have 900 people give them feedback about what they've written, so they can make it more engaging, more educational, more clear, before releasing into the wider world. It just goes to show the benefit of actually building up an audience, because you'd been blogging for how long at that point?

Nir Eyal 8m 29s

About two years.

The interesting thing is that when you write a book, you typically can't do what I did, because the way traditional book writing works, the process works, it kind of works the way we used to build software where, you know you sell a book proposal, and then you essentially are locked into this deal with the book publisher, because you get an advance, and then you go write the book, and you're not allowed to share with anybody, particularly.

I mean a publisher would still to this day, if you told them, "Hey, I want to share this book with 900 people for free before I publish it," they'll say that's a terrible idea, right? Because they own the rights, they own the copyright, and they don't want to do that. They want those people to buy the book, and they don't want it pirated. But I didn't have that constraint, because I self-published it first.

So this is very analogous to how to build software. Waterfall processes versus the lean startup processes that we do today is all about getting customer feedback, hearing from what people like and don't like about your product, so you can iterate on it before you get it out there in its alpha form.

Courtland Allen 9m 31s

We could probably talk for like an hour just about self-publishing and how that industry is changing and where it will be in the future.

Let's dive into the actual content of your book, because… it's pretty remarkable that you built a blog, and you're writing about something that just interested you, and you get to the point where you have 1,000 people who want your book so badly that they'll actually volunteer to help you edit it.

In the book you talk about the hook cycle, I'm sure a lot of people who are listening in have read the book, but let's go through it, kind of step by step. What is the hook cycle?

Nir Eyal 10m 1s

Sure, so I'll give you kind of a 30,000-foot view of this basic four-step process that we see is embedded in all sorts of habit-forming products. So of course when you think about the apps on your phone, the phone itself — apps like Facebook and Twitter and Instagram and WhatsApp and Slack and Snapchat — all of these things have what I call a "hook" built into the core experience, and these hooks have four parts, four phases.

Every hook starts with a trigger, which is a call to action. It tells you what to do next, and those calls to action can either be externally triggered or internally triggered. We'll get back to the internal triggers in a second, but let's talk about the external triggers.

External triggers are things that give you some piece of information for what to do next. Let's take everybody's favorite habit-forming product, Facebook. When you get a notification or an email or something, some kind of ping or ding that tells you what to do next, you open the app, that takes you to the next step of the hook.

The action phase of the hook is defined as the simplest behavior done in anticipation of a reward. Just that simple act of opening the app and scrolling the feed, that's the core habit that Facebook wants to habituate its users to. And what we find is in the history of technology, technology is fundamentally all about decreasing the friction, decreasing the work it takes to get a reward.

So as business people, as people who are designing these products, I can't overemphasize how important it is to make your product as easy as possible to use. If you want to habituate people to doing a behavior regularly, you've got to make that behavior as easy as possible. Because the more people are more likely to do a behavior, the easier it is to do. There's a whole chapter on the trigger phase, and on the action phase. The next thing that happens, just to follow this example of using Facebook, you open the app, you scroll the feed, the next step of the hook is the reward phase.

And it's not just a reward. It's not just about scratching the itch. It's also about having an element of variability. At the core of these habit-forming products that we see today in our digital devices is some kind of variable reward. This comes out of the work of B.F. Skinner, a psychologist back from the 1950s and '60s.

He found that when he gave his pigeons a little food pellet on a predictable schedule (meaning they would push the lever and get a reward, push the lever, get a reward), they only would push on the lever whenever they were hungry. But then when he introduced some variability (meaning the pigeon would push on the little lever and sometimes they would get a food pellet and sometimes they wouldn't), that's when Skinner observed that the rate of response, the number of times that these pigeons pecked at the disk and turned on this lever, occurred much more frequently.

So when you think about what makes gambling something that people habituate to, what makes television shows fun to watch, why we like scrolling our Facebook news feeds, why we like watching sports, why we fall in love, and romance — all of these things have this basic element of variability. And so the most habit-forming technologies also incorporate this core element of a variable reward. Scratching the user's itch and yet leaving them wanting more for the next pass through the hook cycle.

And then finally, the last step of the hook is the investment phase. The investment phase is really something that is quintessential for products. As opposed to offline habits, online habits are so powerful because these products, for the first time, are shaping themselves based on the input you give them and that's brand new. That's really really important.

If you think about the history of manufacturing, the history of business, it took a long time for a product to change. Henry Ford famously said that the customer could have any model of his car, as long as it was black, because it took a lot of time and money to change and customize a product.

Well today, that's not the case anymore. Today, Facebook, if I gave you my Facebook login information or my Pinterest account information or you name it, my Slack account information, it would kind of be useless to you. It actually wouldn't be that useful, unless you were trying to hack me. It actually wouldn't be all that helpful to you because it's been customized based on my information, my data, and that's what makes this current generation of technology so powerful and why it's revolutionizing business.

This investment phase asks the user to essentially co-create the product with the company. Every time you like something on Facebook, you comment, you add a friend, any of these behaviors, you are giving them data about you, you are essentially improving the product with use. And that's a really really big deal that the product gets better and better the more you use it.

That investment not only makes the product better, it makes you more likely to come back and use the product in the future, because you have committed to it. You have put effort into it, which is another known psychological phenomenon, it's called the IKEA effect. We know that the more you put effort into something, the more you like it, the more you appreciate it. That's what makes the investment phase so important. It improves the product with use, [increases] user satisfaction with the product ,and it also loads the next trigger.

Finishing up this Facebook example, when you do any of those investments that I just discussed, you're giving the company an excuse, a reason, a rationale, to reach out to you again, and send you a notification that says, "Hey, guess what, somebody liked your photo or somebody commented on the string that you've commented on, that you were mentioned in." They're reaching back out to you with another external trigger, prompting you through the hook model once again.

Now, the really interesting part is that through successive cycles through this hook, eventually, you no longer need those external triggers at all, and now you become prompted through what's called an internal trigger. An internal trigger is where the information for what to do next is in your head, is a memory, is an association, and it's typically triggered through emotions.

Courtland Allen 16m 21s

If you don't mind me interrupting for a second, I was just about to ask you: in your book, you give an example where users "feel a pang of loneliness, and before a rational thought occurs, you just go into your Facebook feed."

That's something that I've experienced before. You know, just the feeling of sitting at my computer, working and being productive, then I sort of black out for a split second, wake up, and somehow I'm on Facebook or Hacker News without even remembering how I got there.

Nir Eyal 16m 45s

So that's when they've won. That's the essential leap that a habit-forming product has to make, they have to cross this gap of becoming purely externally triggered, meaning it's always a ping or a notification or a commercial or something that tells you what to do, which generally costs money. If you think about the ad industry, they charge big bucks to get in front of enough eyeballs, whereas you [[want to]] transition to a product where people are triggering themselves.

This is why you don't see Facebook running a bunch of Super Bowl commercials or spending money on a bunch of television ads and print ads, radio ads. They don't need it. Because you're not triggered through an external trigger with Facebook. It's the product itself, it's this internal trigger, that gets you to come back, because you've associated with loneliness (in the case of Facebook) or boredom (in the case of YouTube or Reddit), or whatever that negative emotional state that you feel. The relief is found with one of these apps.

Courtland Allen 17m 47s

Yeah, that's the holy grail. That's where all of us want our apps to be.

And overall, I mean that's a lot of information to process, what you just went through, but at the same time it's so simple, it's just four steps. And the research behind it is also fascinating, because it spans such a large timescale. B.F. Skinner was doing his behavioral research on pigeons 70 something odd years ago, whereas the IKEA research that you mentioned took place fairly recently, so we've got basically a century's worth of knowledge being condensed into a limited set of steps that companies are taking advantage of today.

Nir Eyal 18m 19s

I wanted to make it simple so that it's accessible, right? There's a lot of books out there about psychology that are really interesting to discuss at a dinner party, but when it comes to the brass tacks of, "Alright, what do I do with this? How do I build a better product?" They kind of leave you hanging. So I didn't want a lot of fluffy stories. I wanted to tell entrepreneurs and product designers, "Here's what you do. Here's how to use this stuff."

Courtland Allen 18m 45s

Yeah, and one of the points you make in the book is that a lot of companies are super advanced in how much they know about this stuff, but it's kind of a trade secret. They don't have a exactly huge incentive to tell everybody else in the world, "Here's how you build an addictive product."

I'm curious, how did you piece together so much of this information, when such a large percentage of it is probably locked away behind close doors?

Nir Eyal 19m 6s

Right, so one thing I just want to correct if you don't mind, is I don't like the word addiction.

Courtland Allen 19m 11s

Totally.

Nir Eyal 19m 13s

And there's a very specific reason I did not call the book "How to Build Addictive Products". I called the book "How to Build Habit-Forming Products," because addictions are always bad. We never want to addict people.

Addiction is defined as a persistent, compulsive dependency on a behavior or substance that harms the user, so I am anti-addiction. I think if companies addict people knowingly, they have an ethical responsibility to help those people disconnect.

Now, habits are a whole another story, because we have good habits, and habits can help people live much better lives, so everything in the book is really about how to build habits to help people do things they want to do, but for lack of good product design don't do. I just wanted to make sure we differentiate between addiction and habits.

Courtland Allen 19m 57s

Yeah, I think it's a worthwhile distinction to make and hopefully toward the end of this episode we'll have a lot more time to talk about the moral issues at play, because I think there's potentially a large gray area between where a habit ends and an addiction begins. Or you can imagine using something like Twitter productively and then using it in a distracted or addicted manner at different times in the same day, where it's hard to make a single summary judgment.

Nir Eyal 20m 22s

Yeah. But frankly, I learned a lot of these techniques from businesses that are dependent on addiction. There are several industries that I won't work for. I do a lot of consulting on my book for products that want to increase engagement and user retention. And there's some industries I just won't talk to and I won't work with, because they depend upon, not habituated users; they depend upon addicted users.

So when a casino calls me, I won't work with them. When a gaming company… not all gaming companies. When I think about online gaming companies, I think about Clash of Clans or Candy Crush or FarmVille back in the day. Many of these companies — again not all of them — many of these companies depend upon what we call whales, these 1% of users that make up 99% of the revenue of these companies.

So it's not about somebody going to Las Vegas on a bachelor or bachelorette party every couple of years. Vegas doesn't really care about those people. Vegas depends upon the people who sit in front of those slot machines, sometimes wearing diapers so they don't have to get up from their chairs. that's who Vegas depends upon, and so that's why I won't work with those type of companies, because it's really about addicts.

The way I learned the techniques I put in the book are from watching and learning from these industries that are trying to use these tactics to addict people. And the point here, why did I study those industries, the point here is that [what] I want [is] twofold:

One, I want to use these same techniques so that it's not just the gaming companies and the gambling industry and the social networks. They don't need to read my book, they already know this stuff. I want to take the same techniques and bring them to apps that help people save money, that help people exercise more, that help them connect with friends and family, that help them become more productive at work, using those same tactics. You're a dummy if you don't use those tactics in these businesses that really, truly can help people improve their lives, so that's the number one reason I wrote the book.

The second reason I wrote the book is that I wanted all of us to understand that look, these products and services… you know you can't help but read this book and not realize, wait a minute, this is being done to me, right? I need to be more aware about why is it that I keep using Facebook even when I don't want to, why do I keep watching Netflix and YouTube even when I don't want to do that, when I know I should be doing something else?

It's important to realize that these products, they didn't get lucky, they didn't design these products and just stumble into them. They are engaging by design. I mean if you think about the background of Mark Zuckerberg, Reid Hoffman, the founders of Instagram, all of these people, all of them, have psych backgrounds. You know Mark Zuckerberg's major at Harvard, before he dropped out, was computer science and psychology. Kevin Systrom, at Stanford, one of the founders of Instagram, was a Symbolic Systems major, which is a combination of CS and psych. They understand what makes you click and what makes you tick better than you understand yourself.

And so the way that we put technology in its place, is by understanding how these hooks work so that we can build healthy habits when they serve us and also I'm just as much of an advocate for breaking unhealthy habits, where they don't give us what we want.

Courtland Allen 23m 38s

Yeah, I think there's a case to be made that you could characterize this entire process as an arms race of sorts, where companies are creating better and better hooks, but users are getting better also at recognizing what's going on and therefore resisting what's going on, even if they're doing so subconsciously.

And I think you can see that trend, for example, in the advertising industry, where you look back at the ads from the early 20th century, and they're almost comical. I mean the lack of subtlety is stunning, and those ads would probably never work on people today, but they worked on people back then because they didn't have their defenses up.

Do you think that companies nowadays will have to continue iterating and improving upon their habit-forming techniques in order for them to keep working or are we at a point where the methods are so effective and they penetrate to such a deep level in the brain, that's so base and automatic, that they're difficult or even impossible to resist, despite knowing how they work?

Nir Eyal 24m 28s

No, I think that we have this perception that these products are hard to resist today, because they're so new, but I promise you, in a few years time, we'll look back and laugh, just the way we laugh at old ads for cigarettes, et cetera.

What happens with technology, what happens with persuasion techniques, is invariably that when people learn about how these techniques work, they do become less effective to some degree, and I think that's a very good thing. I think we need this phase of assessing, wait a minute, is this really helping me or is this hurting me? I mean I'm very much an advocate for us taking a step back from our technologies, and asking ourselves this fundamental question of, "Am I serving the technology or is the technology serving me?" And I think we should do that for all sorts of habits that we have, not just when it comes to our personal technology.

Look, the average American spends five hours a day watching television. What the fuck? I mean that's ridiculous, and I think we should be just as much up in arms over how much time and human potential that wastes. Nobody talks about it. Everybody's up in arms about Facebook or, you know, games. But there's lots of ways that people waste their time that I think people should stop and ask themselves. Sports, for example. Oh my God, how much time are we going to spend watching a ball, or a puck, bounce across a field? I mean, come on, like there's other ways to spend our time.

So, you know if you take a look at time wasters and want to take a moral stance on them, there's lots of time wasters out there.

On the other hand, we could ask ourselves, wait a minute, you know what, entertainment is something that people want. Boredom is a fundamental human problem that we need a solution to. Boredom sucks. Boredom is literally painful to the human brain, in many ways as painful as physical pain. And so, people look for relief, people look for solutions.

And so whether it's religion, whether it's love, whether it's drugs, whether it's alcohol, whether it's games, whether it's sports or television or movies or books, I mean the amount of distraction from day-to-day life that people need to quell this pain of boredom, of just sitting still, is a huge industry, right? Multiple billion-dollar industries are based on relieving that boredom.

Courtland Allen 26m 52s

I think when you're talking about entertainment and you're talking about boredom, and you look at applications that are social like Facebook and Twitter, you look at games like FarmVille and Candy Crush, it's easy to see how creating habits is not only useful for those companies, but it's pretty much necessary and it's eminently doable. Because they're creating products that are inherently fun and that cure your boredom, and that have obvious rewards.

But let's say you're a founder and you're working on a more typical company, like developer tools for example. Or let's say you're building a productivity application. I think it's less obvious how habits play into the people using your product, as opposed to them using it because it solves a particular problem, or because their coworkers are urging them to use it.

Do you think the hook model is just as applicable with these types of companies?

Nir Eyal 27m 34s

So the real differentiation, the line of demarcation is not enterprise versus consumer. It's frequent versus infrequent.

If you have the kind of product that somebody buys and then doesn't use, you don't need a habit, because a habit depends upon sufficient frequency. The behavior has to occur within about a week's time or less. The more often it occurs, the more likely it is to become a habit, also the more you need it to become a habit. Facebook doesn't really work if you use it once a year, you have to use it often or it's kind of useless.

So, you know, when it comes to enterprise software, if you're selling the kind of product that is only used once something terrible happens on some server farm somewhere, then you don't need a habit. You just sell the product and it just works in the background until it needs some kind of externally triggered involvement.

Now, lots of products today, even in the enterprise, especially in the enterprise, are no longer being sold from the top down. They're being sold from the bottom up. So when you think about products like GitHub or Salesforce or Stack Overflow — the list goes on and on — of different products in the enterprise today, [they're] used first by frontline employees. And then once they've adopted them, then one day the manager wakes up and says, "Hey, who do I pay, this is so valuable, where do I send the check?" I mean Slack is a perfect example of that, the fastest growing enterprise product in history.

It's no longer good enough to have a product that does the right things, it has to actually engage people, it has to keep people coming back, it has to form a habit, even in the enterprise. Or, for a SaaS company, you're never going to get re-ups. They're not going to keep resubscribing and keep paying that monthly bill if nobody is using the product, so I think habits are just as important, when it comes to the enterprise if the product is used frequently enough to require a habit.

Courtland Allen 29m 31s

The point about frequency that you made is a very good one, but I think what I'm getting at here is whether or not there are other factors that cause people to return to apps frequently, but not habitually.

One example I could pull from my own personal life is Asana. I use Asana for task management. I only have a limited window into my subconscious, so I could be totally off-base here, but I don't feel hooked on Asana, nor do I feel like it's a habit. I don't ever find myself opening it the same way I might reflexively open Facebook, where I just go there for seemingly no reason just because I'm hooked on it.

However, I do use Asana on a regular basis, multiple times per day, because that's where all of my tasks are, and I need them to get work done, so it solves a real problem for me.

Am I not coming back to this app because of the problem that it solves? Or would you say that I'm coming back because it's successfully forming a habit? And if so, how would you fit an app like Asana into the hook model?

Nir Eyal 30m 21s

Yeah, I think Asana's a great example of a product that you use habitually, and I think part of the test for is it used habitually is, what would happen if Asana sent you an email tomorrow and said, "Hey, we're shutting down, sorry."

That would be a big deal! That would be a big problem for you, right? Because you've formed these habits and routines, a lot of them based on the investment you've made right, the fact that they've collected your data about all your tasks and the various states of completion. That's really important stuff, and so I think the hook… we can walk through it actually for a product like Asana.

I think the internal trigger is uncertainty about what to do. So you sit down at your desk every day and you're asking yourself, what's most important, what's top priority? There's one internal trigger, there are probably others you could think of.

Courtland Allen 31m 7s

That's a big one there.

Nir Eyal 31m 7s

You sit down at your desk, yeah, that's the big one right. So the clock's ticking on your day, you need to be productive, and you ask yourself what do I do next? And this happens subconsciously, by the way. I don't think people sit there twiddling their thumbs and say, "Ooh, what do I do next?" This happens in the blink of an eye.

You push that little icon, wherever it might be, and you open up the site at the action phase, right? It's just opening the page.

The variable reward is, "What's next? What do I need to do?" Of course one of the things that makes a product like Asana so powerful is that it involves other people, so the variable reward is what I call rewards of the tribe: knowing that somebody finished a task and now you need to do something, they're waiting for you, there's this variability around. Is the task complete, how well was it completed, what do I have to do next, what message do I need to send to somebody to get the next, to keep moving the ball forward, all of these things are variable, there's uncertainty there about what happens next.

And then of course the investment is pretty obvious, it's every time I add information, I add data, I add tasks, I assign tasks, I invite people, all of those are investments that make the product better and better and better with use.

Courtland Allen 32m 14s

When you talk about step three of the hook model, and you're talking about variable rewards, what's one way that entrepreneurs can identify the parts of their apps that count as rewards as far as the hook model is concerned?

If you're building something like a game or Facebook, then it's obvious. The reward is when you kill the bad guy, or when you log in and you see photos of your friends, or you see that you've gotten new likes. Those are obviously rewarding experiences, so the only task left is to figure out how to vary them.

But if you're building something like Asana, it's less obvious what the rewards are. So what counts, and what doesn't?

Nir Eyal 32m 44s

You know, for the sake of time I'm severely constricting the book here, but there's a lot more in the book about how to do exactly that.

So in the chapter on rewards, I talk about these three different type of variable rewards: there's rewards of the tribe, rewards of the hunt, and rewards of the self. Rewards of the tribe are pretty obvious. These are rewards that come from other people, things that feel good that come from other people. And then there's rewards of the hunt, which is all about the search for information, for material goods, for physical possessions. So hunting for a deal, looking for news snippets — all of these things are rewards of the hunt. And then you have rewards of the self, which is all about the search for mastery, completion, competency, control.

I go into a lot of depth around these three types of variable rewards. All habit-forming products have at least one of these three rewards. Some, the really good ones, have all three. When you think about email, email uses rewards of the tribe, hunt and self, which is one of the reasons it's such a persistent technology that nobody terribly loves all that much, but it's so habit-forming that it's hard to stop using.

Courtland Allen 33m 55s

Yeah email's one of those things that I dread, but like you said, you just can't stop using it.

And so there's really, you know, there's four steps here, and you have to get people through all four of these steps in order to complete a loop through the cycle. You can't sort of just be missing an entire step.

But which of these steps would you say is the least important? If you're a founder working at a company and you have to slack off a bit on one part of the cycle, what would it be?

Nir Eyal 34m 19s

That's really contextually specific. It's based on your product or service.

When I meet with companies or when I talk to founders, you know sometimes they're deficient with their triggers, sometimes it's the action is too difficult, other times the reward isn't rewarding or it doesn't leave the user wanting more. Sometimes they're not asking for a proper investment or they're not using it correctly.

There's no one phase of the hook where a company is deficient, but what I will tell you is that, if your product is not habit-forming and it's used with sufficient frequency, if it should be used with sufficient frequency and it's not, that's where the hook is a diagnostic tool.

So the hook is really useful, either very early days, before you have a product, you just have a paper sketch, and you're trying to figure out, "Alright before I invest my life and my time and my money into this new company, how do I make sure that it has the four basic elements of a hook to make sure it becomes habit?"

The other place where it's very useful is, you know after the product is built, "Dammit, it's not habit-forming and we don't know why!" And so then it becomes a diagnostic tool where you can run through the four steps of the hook to figure out which of your four steps is missing, and then of course that's where you focus your time and effort.

Courtland Allen 35m 26s

I've got a question from a user on the Indie Hackers forum who wants to know, what is the low-hanging fruit here? You work with a lot of companies on helping them build more habit-forming products. Are there any common mistakes you see being made broadly across industry lines, and what advice do you have for avoiding these mistakes?

Nir Eyal 35m 44s

Well the biggest thing I want founders to hear is that they don't use this right. The questions I get asked are a lot of times about, you know, kind of what you were asking about earlier. "Oh, why is this dangerous?" and "Technology seems to be addicting everybody." And I agree, there are downsides that we need to talk about, but that's not the biggest problem.

The biggest problem is that we're not helping people enough. We are wasting so much time and human capital making software not suck! I mean before this interview we were just talking about how shitty the software is to get this call going, right? Like, how much technology out there, when you think about government services, when you think about engaging with local businesses, when you think about all these things that could make our life easier and better… These technologies, they don't suck us in, not the way Facebook and Twitter does. No, they just suck.

And so, that's really where I want to focus my time and effort. That's why I'm so passionate about what I do. The first thing founders need to do is to wake up and realize that having a good product is not enough. Everybody thinks that if their product is good, then that's going to be it. It's not the best product that wins. There is no 11th commandment that says that the best product wins. It's not the best product that wins, it's the product that captures the monopoly of the mind, the first-to-mind solution, that's the product that captures the market.

So the first thing to do is to realize that you have to understand consumer psychology if you're going to build an engaging product.

But more specifically, if you're asking, which of the four phases do companies typically neglect, it's probably the investment phase.

And the metaphor I like to use here is, you know imagine you get a call from a good friend of yours, and they say, "Hey, you know Courtland I haven't seen you in a really long time, I'd love to sit down together, let's grab lunch or some coffee together."

And you say, "Great, let's do it," you sit down together, and you have a really great conversation, they tell you what's going on in their life, you become a little vulnerable and you tell them about what you're struggling with, you tell them about your work life, your love life, you know you kind of spill your guts and tell them all this information about you, about what's going on in your life.

Then you part ways, it was a beautiful lunch, and then a few weeks later they call you up again and say hey, "Let's get together again." You sit down with them, and you start seeing how they're doing, and then you very quickly realize that they don't remember anything you told them. They don't remember a single detail about your kids names, about where you work, they don't remember any of it.

Very quickly, that person would not be your friend, right? This person is either a jerk, or has amnesia.

So, you think to yourself, we wouldn't do that. The apps that we're building, the products and services that we're making, we wouldn't do that would we? Well, we do this to people all the time. We ask them for information and then we don't do anything with it. We don't make the product better based on the information they're giving us.

I think that is a huge mistake that products and services that are attempting to become part of our daily routine, whose business models depend upon becoming habit, have to ask people for investment, and do something with it, have to make the product better and better with use, just like a friendship would get better the more you know about the other person.

Courtland Allen 39m 5s

Yeah, I think that for most founders, the idea of kind of slotting the app that they're working on into the same slot they might put a friendship, or a friend in, is completely unnatural. It's not something that you think, that my user has a personal relationship with my product and that therefore if it doesn't act in the same ways that another person does, they won't find it as engaging, or as friendly, or as easy to use.

Also, to your point about the investment [step] being so difficult, or one of the most oft-neglected parts of the hook cycle, in a way it almost seems contradictory to what's going on in another part of the hook cycle, which is the action.

The action is all about allowing the user to come into your app with as little friction as possible. Your goal is to remove as many obstacles as possible and ask the user to do as little as possible, so they're more likely to get into your app without dropping off, and start developing a habit.

But then by asking users to invest in your app, you're doing the exact opposite. You're saying hey, upload your photos and fill out a profile and follow people and create tasks or whatever it is that your app does, but of course all these actions involve a lot of work.

What's the best way to strike the right balance here, and how do you know where to take away friction and where to ask for investment?

Nir Eyal 40m 15s

Right, so it's really about the timing. A lot of companies I see do very much what you've described. Before you can use the product, we'd like you to tell us your name, your email, your Social Security number, your mother's maiden name, your place of birth, your favorite color, your favorite food. Okay this huge onboarding process, when I haven't even gotten any benefit! That's a big mistake.

And so I think with every interaction that we use a product, we have to first scratch the user's itch. We have to very quickly give them that variable reward. But then after the variable reward, that's when we ask for the bit of information. That's where we put in a bit of friction, to make the product better and better with use, because at that point it's natural.

If I've gotten something out of the product, sure I'm going to like something or comment on something or add something or contribute something. Again, it has to be very simple. We still have to follow the rules of good product design to make it as easy as possible, and if it's not easy we'll get less of that behavior. But it's really about the fundamental timing of when in the user flow do we ask for that investment.

Courtland Allen 41m 17s

On the subject of timing, you wrote Hooked back in 2012, or at the very least you started blogging and writing about it back then. That was only five years ago, but as we all know, things move fast in tech. Just for reference, that was the same year that Lyft was created, so it's safe to say that things have changed since then.

If you could rewrite Hooked today, is there anything that you would change about the book, or have things largely remained the same?

Nir Eyal 41m 37s

Well, the book's actually published in 2014, but you're right, I started writing it back in, or writing the blog posts back in 2012.

You know there are a lot of things that I didn't realize or I didn't put in the book, but I think the fundamental tenets haven't changed. Many of the examples, I'm sure within the next few years, a lot of the examples today, I can't think of many that aren't still current, they're all products that people still use. But I think in the next few years, there will probably be new companies. I don't think I mentioned Slack in the book, because it was published back in 2014, but there's been a lot of I think very interesting things happening when it comes to the enterprise space.

Courtland Allen 42m 16s

If things haven't changed too much in recent years, I'd love to hear your thoughts on where they're heading in the future.

Do you think the most impactful change we're going to see is a deepening of our understanding of the habit-forming processes in our minds and how to take advantage of them, or do you think the more impactful change will be sort of a broadening of our ability to apply what we know across a wider breadth of industries, so we'll see more than just gaming companies learning how to effectively create habits in their users?

Nir Eyal 42m 43s

I think we're going to see the world becoming a better place because we can master our habits. I'm very long on human ingenuity, and I think what we can do with this technology is to help people live the kind of lives they want to live, but to date haven't lived because doing the things they want to do is too hard, and I think that technology is this amazing enabler of reducing user friction so that they can actually do the things they want. And so I'm very bullish.

I think that, you know, I've seen it already. I've put my money where my mouth is, and I invested in companies that use the hook model. And just to name a few, I invested in 7 Cups, which uses the hook to bring psychotherapy to hundreds of thousands of people every single week all over the world. I invested in a company called Byte Foods, which builds healthy habits around food, by putting these almost vending machine-like devices in office buildings and within food deserts, changing food habits. I invested in a company called Kahoot!, which changes habits in the classroom.

So, you know, we're really scratching the surface of what habit-forming technology can do. I think, as technology becomes more pervasive and persuasive, we can help use these technologies to do the behaviors we want to do.

Courtland Allen 44m 2s

Yeah, I like that optimistic vision of the future. And it's easy, I think, to look at it pessimistically as well. I think they're not mutually exclusive. There's both good and bad things happening here.

Just to give you a few examples. Like you said earlier, people can use the hook model to facilitate addictions, but even outside of addictions, in the content industry for example, we see a lot of people taking advantage of our understanding of triggers to write sensationalist or clickbait headlines just to drive as many clicks as possible and spur people to action.

The bad guys here, so to speak, can have an effect on the rest of their industry and on the good guys, because if you see all your competitors using these techniques then suddenly now you have to employ them too if you want to stay relevant and competitive, and in some industries it drives kind of a race to the bottom.

Nir Eyal 44m 44s

Yeah, but I'm not worried and I'll tell you why. Because, clickbaity companies don't use the hook model, because they don't have a model to use it. Now Facebook benefits from the hook model, but you don't come to clickbaity websites out of habit for very long, because you realize they're stupid fucking clickbaity headlines. And so it's very hard to keep selling people a product that hurts them.

Think about that for a minute. How many products do you keep buying, do you keep consuming, if they hurt you? Right now addiction is a separate category, when you talk about addiction, when you talk about people who smoke, people who drink too much, people who gamble too much, people who are addicted to online pornography, that is a situation where people keep punching themselves in the face every day because they cannot stop, so there's a special category for addiction. But for the vast majority of people out there, we're not talking about addiction.

If you read enough stupid clickbaity headlines from Buzzfeed or whatever, guess what? You stop reading it. If Facebook is getting on your nerves because you keep checking it, you know what most people do? They uninstall Facebook, right? They moderate their behaviors, I mean human beings, for all time, whenever there's a technological shift, there's always bad that comes with the good, but you know how we get out of that? We adapt our behaviors and we adopt new technology to put the bad aspects of the technology in its place.

Think about the Industrial Revolution. So much good came out of the Industrial Revolution. Nobody wants to go back to the days before cars and airplanes and all the good things that the Industrial Revolution gave us, but of course, now we have global warming. So of course it's going to give us a curse, there's always a curse. The solution to all these bad aspects of a technology is more technology to fix those bad aspects.

I mean 1.25 million people die every year in automobile accidents. None of those people would die had it not been for the Industrial Revolution. But the way we reduce auto fatalities is not by going backwards. It's too late, we'll never go back. We have to invent new technologies that make automobiles safer and safer, and that's exactly what we've done, car fatalities per mile are lower than ever, and I think we're going to see the same thing with technology.

Courtland Allen 47m 10s

And I totally agree with you by the way. I don't think the answer's to take a step backwards. I'm a technophile, I love technology, and not only is trying to stop progress unfeasible, but it's probably also less effective at solving problems, even problems created by technology.

But at the same time, there's kind of a tragedy of the commons problem to examine here as well, where people can do things that, on an individual basis might seem okay or might seem manageable, but on a wider scale, these things can still have detrimental effects. I don't think it's a great thing that such a large percentage of content has kind of converged on a small number of sensationalist, clickbaity headlines.

Nir Eyal 47m 48s

Yeah, but when was this not the case in history? By the way, I'm not defending these people. I don't like their headlines either. I don't read them, but just to put this in perspective, when was there not an age when people consumed trash?

Courtland Allen 48m 4s

Oh, there's never been an age when people haven't consumed trash.

Nir Eyal 48m 6s

Yeah, you want to go back to the age of yellow journalism, I mean, talk about fake news, look at the history of media, this is probably the least fake news period in history, I mean, Yuval Harari, who I really respect, he wrote the book Sapiens--

Courtland Allen 48m 20s

Great book.

Nir Eyal 48m 20s

--and Homo Deus. Great book. You know, he has this great line where he talks about, "Fake news? What do you think religion is?" Right? What's new here? People believing mumbo jumbo is not new.

Courtland Allen 48m 35s

But what's interesting to me here is, I wonder if advancements in our understanding of psychology will help us resist that? You pointed out correctly that companies that want do good in the world can use the hook model to help people build positive habits, but what about using and understanding the hook model to help people resist their negative habits?

Nir Eyal 48m 53s

That's right, so I'm just, if you look at my blog actually, about 50% of my writing is about how to build habit-forming products. The other half of the writing is how to break the hook, when it comes to these habits that don't serve us.

The way we do this is we look at the hook model, and we figure out, how do I remove the triggers, how do I make the action more difficult, how do I delay the rewards and how do I make sure I don't invest? And once you see the world through this lense, it is much easier to get your bad habits under control and to propagate more good habits.

Courtland Allen 49m 25s

Yeah, I was going to ask you exactly which parts of the hook model would you focus on in order to break a habit. And you mentioned investment. What about the other three steps? Are there things that you can do to break a habit?

Nir Eyal 49m 37s

Sure, yeah, absolutely so, for all four of the steps you can devise ways to break the habit. The trigger, for example.

So, you know one thing I noticed, I was using Twitter too much, it wasn't serving me, I felt like I was serving it, so I removed the trigger from my phone, I uninstalled the app from my phone. I still use Twitter, I love Twitter, but I don't want to use it when I should be hanging out with my wife, my friends, playing with my daughter, I don't want to use it during the day, so I uninstalled that trigger on my home screen. I deleted it from my phone. How simple is that?

You know, it turns out that about three quarters of smartphone users never adjust their notification settings. That's lunacy. Everyone should take five minutes and turn off all those stupid notifications from the apps that don't deserve to interrupt you. How simple is that?

Next the action phase. Well the action phase is about making the action easier to do if you're a product maker. If you're trying to break a habit, it's about making that behavior harder to do.

So here's one habit that I wanted to break. I noticed a few years ago that my sex life with my wife… I've been married now for over 15 years, and our sex life was suffering. We would go to bed and instead of snuggling, instead of being intimate with each other, she was fondling her iPad and I was playing on my iPhone, and that was not doing our relationship any good.

So, here's what we did. We got a $10 outlet timer at Home Depot that, every night at 10pm, automatically shuts off our internet router. Now there are actually internet routers that have this same ability built in. If you have an Eero, E-E-R-O, it's a great mesh network that actually has this built in. You can turn off certain devices at certain times of night, it's fantastic.

So I could go, if I wanted to, I could unplug the router, I could use a different way to get online. I could do that, but what I've done is inserted a little bit of friction, so that now I'm mindful, as opposed to mindless, about how I use this technology. How simple is that?

Then the variable reward phase.

Courtland Allen 51m 40s

Yeah, I think it's super smart, to attack it kind of in those earlier stages, where you don't even let it get to the point where you have this behavioral script that gets triggered and you start going mindlessly into this process of, "Okay, now I should consume these rewards, and then invest a little bit more." I think people greatly underestimate how effective it is to put yourself in a position where you don't even have to fight that battle.

Nir Eyal 52m 2s

Right, or just think for a minute, wait a minute, is this actually important? Because if you're just scrolling and scrolling and scrolling, you don't have the time to think, "Is this actually serving me?"

Courtland Allen 52m 10s

Yeah, and hopefully knowledge about how to do these things will spread, because for someone like you, you're the person who knows how to form and break habits. But for a lot of other people, they're just sort of being turned onto this stuff, so it's brand new.

Nir Eyal 52m 22s

Yeah, I think we're seeing that already. I think we're seeing a lot of people kind of wake up to the fact that, wait a minute, you know what, like, Instagram is not making me feel good. Why do I keep checking it every day? And I think that's great. Just because I wrote the book on how to build this stuff, I'm not an advocate for using all these products, if they don't do you good, stop using them.

Courtland Allen 52m 40s

Then stop using them.

Nir Eyal 52m 41s

Right, you should be in control of what technology is helping you or hurting you.

That's really the message by the way, just the last message I want to leave people with. Believing that you are powerless, believing that you're some kind of zombie at the wheel of these technologies, is the worst thing that you can believe. There have been studies done on alcoholics, and we know that alcoholics who believe that they are powerless to resist the temptation of booze, are the ones that are by far more likely to relapse.

So by propagating this myth that technology is addictive, that it's hijacking your brain, you're actually doing yourself a disservice, it's not hijacking your brain, you're only powerless to resist it if you believe you are.

Courtland Allen 53m 24s

I like that as a point to end on, and hopefully I don't ruin it, but I want to ask you one more question if you've got time?

Nir Eyal 53m 28s

Please.

Courtland Allen 53m 29s

Hooked is one of the few non-fiction books that I've read recently that didn't seem egregiously long. It was actually a quick and pleasant read. It only took a few hours, and I got a lot out of it. Alternatively, most similar books that I've read felt much longer than they actually needed to be, which has the unfortunate effect of making them a waste of time.

I realize you might be a bit biased here as an author yourself, but what are your thoughts on this push and pull between being an aspiring entrepreneur and spending a lot of time reading (to avoid making the mistakes that other people have made) versus jumping in and learning through experience?

Nir Eyal 54m 0s

It's one of those things that the answer is an unsatisfactory answer, but turns out to be pretty much the answer to life, which is, it depends. The answer to everything is: it depends.

And so I think that there's, in an entrepreneur's journey, I think that there is a phase when you don't know anything, that it's really good to get up to speed. You need a base level of knowledge on, what does an income statement look like, what does a balance sheet tell you, what's a network effect, what's economies of scale? You know there are certain fundamental concepts that I think behooves you to understand before you dive into business.

Courtland Allen 54m 42s

So it's really about finding that line for yourself.

Nir Eyal 54m 45s

Right, but then at some point, what I see, I see a lot of people who are very book smart, but very life dumb.

They don't have any real-world experience of what is it like to go out and press the flesh, and make a sales call and actually hit the street, what does that actually feel like? They've read about it in books, but the books can't tell you how to close a deal when it comes to actually selling a product in front of a live human being. That's something that you can only do if you go out into the field and do it, a book is not going to give you that.

So I think that at a certain stage it's really about getting some base knowledge and then later on, it's about actually getting out in the field and trying and experimenting, because real innovation only occurs at the precipice of known knowledge. There's a point where nobody knows what's going to happen next and that's where innovation occurs. So at some point, no book will tell you the answer, even mine. I can give you the archetype, I can give you the pattern, but how you actually do it, only you will know.

Courtland Allen 55m 49s

And you heard it here from Nir Eyal: technology does not control your life, and no book is going to give you the actual specific answer when you come to the end of the road.

Nir, can you tell us where we can go to find out more about you and Hooked online?

Nir Eyal 56m 1s

Absolutely, so my blog is NirAndFar, Nir spelt like my first name, N-I-R, NirAndFar.com, and my book is called Hooked: How to Build Habit-Forming Products, and it's sold wherever.

Courtland Allen 56m 12s

Thanks so much for coming on the podcast.

Nir Eyal 56m 13s

My pleasure, this was really fun.

Courtland Allen 56m 16s

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