Upload
ahmed-ibrahim
View
153
Download
4
Embed Size (px)
Citation preview
Habit Forming Products (Hooked)
Lecture 2
Forming a Habit - Two Things form a habit:
- 1) Frequency
- 2) Attitude change
- Frequency: people who continue frequently for along time do the same behavior
Forming a Habit (cont.)- Attitude change: people who perceive the behavior differently
continue to do the same habit for along time
- E.g. people who say to themselves i don’t want to floss because it’s dentist job but then he feel weird to go to bed without flossing
- Those are the people who sustain the new behavior
Why habits matter for our business
Why habits matter for our business- 1) creating consumer habit drives higher customer lifetime value
(CLTV):
- If customer uses a product for a long time he adds to the bottom line every month
- They make money of their use so the CLTV become higher
Why habits matter for our business (cont.)- 2) creating consumer habit give companies greater flexibility to
increase prices:
- When user use a product frequently it become a routine
- Company has a flexibility to increase price so company can be profitable
Why habits matter for our business(cont.) - 3) creating consumer habit supercharge growth:
- Habit is very important part of growth
- Every company want to find a way to go viral
- Virality without engagement isn’t good enough
- Growth without engagement is called leaky bucky business:
- Customers come in, customers go out unless we have engagement
Why habits matter for our business(cont.) - 3) Creating consumer habit supercharge growth:
- More important than virality itself is viral cycle time
- Viral cycle time: if we get users to use products more frequently we can lower the time between how long to tell friends about the product
- And as a result the product will be viral
Why habits matter for our business(cont.) - 3) Creating consumer habit supercharge growth:
- Growth is necessary but not sufficient
- Virality can be one tool to grow
- The more the users use the product the faster the chances to supercharge growth
Why habits matter for our business(cont.) - 4) Creating consumer habits increase defensibility
- The more the customer rely on the product it becomes a part of their daily routine
- So it will become very difficult for a competitor to come and take that customer
- The more the customer invest on the product the more it become a daily routine increase the defensibility of the product
Habits
Habits- Habits is good for customers and for the business but it is very hard
to form a habit
- Finding a technology to create a new habit is exceptionally rare
Habit
Habit- “Unprompted user engagement”: The act of a customer interacting
without even thinking about it
- E.g checking email,opening facebook or twitter without thinking why am i doing this particular action
Habit- Plenty of businesses don’t require habit
- Those businesses can use ads, word of mouth or any other way to bring customers into the app
Building products- State of the quo in how new products are built is listen to customer
feedback
- Habit forming product is about learning new way to form hypothesis of what you should build
- The new way of forming hypotheses come from customer psychology, how people think and how they behave
Building products- The new way of forming hypotheses come from customer
psychology, how people think and how they behave
- This is to increase your odds of success
- The difference between success and failure is building the staff user want
Hook
Hook
Hook- Hook is a model to create habits with product users
- Hook is an experience designed to connect user’s problem with your solution with enough frequency to form a habit
- Hook is a model to better build product hypothesis
Sources- How to Build Habit-Forming Products course by Nir Eyal (Lecture 2)