Showing Revision 2 created 05/25/2016 by Udacity Robot.

1. Title:
   Nir Eyal - Habit Forming Products Product Design Udacity
2. Description:

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   Hello, I'm with Nir Eyal,
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   the author of Hooked,
   How to Build Habit Forming Products.
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   Thank you for joining us.
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   >> My pleasure.
   Good to be here.
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   >> So,
   tell me a little bit about the book.
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   >> Sure.
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   So, my book is really about
   how do products engage users?
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    How do we build products and
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    services To keep people coming back, not
    every business needs to form a habit.
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    But every business that forms a habit
    needs a hook, and so that's what
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    the book is really about, it's about
    this pattern that I call the hook model.
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    This four step process of trigger,
    action, reward, investment
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    that keeps people coming back and using
    these various products and services.
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    And my hope here is that we
    can use the psychology of
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    what makes products engaging to help
    people live happier, healthier,
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    more productive, more connected
    lives by using habits for good.
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    >> And now,
    I as an entrepreneur use this model?
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    >> Right.
    So
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    if you're building a product
    that requires a habit, so
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    if you think about products.
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    Some of the most successful companies
    over the past several years.
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    Companies like Facebook, and Google, and
    Instagram, and WhatsApp and Snapchat,
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    and Slack these companies have
    all formed habits in users.
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    Now that's not a requirement lot's of
    businesses can do just fine without
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    forming a habit, but if you're the type
    of company who's business model relies
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    upon a habit just like those companies
    I just mentioned they would go out of
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    business if they had to send advertising
    every time just to bring people back.
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    So if you're that kind of company,
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    if you're an entrepreneur building
    a product that requires people to
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    come back on their own, you can use this
    framework to figure out, hey do I have
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    the fundamental elements that I need to
    form, to build a habit-forming product?
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    >> Is this only for consumer products?
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    >> No.
    So whether it's enterprise products or
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    consumer products, doesn't matter.
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    What matters is,
    is the product something that people use
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    throughout their day with little or
    no conscious thought?
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    So if you're building an enterprise
    application that, you know,
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    might be some piece of software that's
    put into some server farm somewhere and
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    nobody actually uses that piece
    of software, that's fine.
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    That's a great business, you know,
    you should keep doing that,
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    but you just don't need to have it for
    that, because that's not used regularly.
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    On the other hand if you're building an
    enterprise product like a communication
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    tool, like Slack, or GitHub, or
    Stack Overflow, or Sales force.
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    All of these are enterprise facing
    products that necessitate habits.
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    They require people to
    come back on their own.
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    And for those types of products,
    you need a hook.
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    So these hooks, this four step process,
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    starts with a trigger to an action and
    a reward and then an investment.
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    So every hook starts with a trigger.
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    A trigger prompts the habit and
    we have these two types of triggers,
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    an external trigger or
    an internal trigger.
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    External triggers are things in
    our environment that tell us
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    what to do next.
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    They give us some piece of information.
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    Click here.
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    Buy now.
    A friend telling you about this great
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    new app through word of mouth.
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    All examples of external triggers.
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    These external triggers
    prompt us to action.
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    That's the habit itself.
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    Open an app, scroll through pinterest,
    search on google,
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    push the play button on YouTube.
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    These are these actions
    that we do with little or
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    no conscious thought that
    are these very simple behaviors
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    these very small behaviors
    that we do seeking a reward.
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    Which brings me to the third step
    of the hook the reward stage.
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    Is where the user's itch is scratched,
    where they get what they came for.
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    And yet there's a bit of mystery
    around what they might find
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    next time they engage with the product.
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    So it's not just a reward.
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    It turns out that habit-forming
    technologies integrate what's called
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    a variable reward.
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    So this comes from
    the classic work of B.F.
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    Skinner, the father of
    operant conditioning.
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    Skinner found that when he gave
    rewards to his pigeons and
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    these little boxes on a variable basis.
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    So, sometimes the pigeons
    would peck at the disk,
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    they wouldn't receive a reward.
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    The next time,
    they would receive a reward.
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    What Skinner observed was,
    at the rate of response,
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    the number of times his pigeons
    peck at the disk, increased
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    when the reward was given on an
    intermittent schedule of reinforcement.
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    And so in all sorts of products
    that we find most habit-forming,
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    most engaging, we find this bit of
    mystery, this bit of variability.
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    So searching, and scrolling and
    scrolling on a newsfeed, or what makes
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    sports fun to watch is the uncertainty
    of will our team win the game.
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    Or what makes for
    a great TV show or a movie?
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    The uncertainty about how the happy
    ending is going to unwind.
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    All these are examples
    of variable rewards.
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    And finally, the investment phase,
    the last step of the hook.
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    The investment phase is where the user
    is prompted to put something into
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    the product, to invest in the product
    In anticipation of a future benefit.
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    So, the purpose of investments
    is to increase the likelihood fo
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    the next pass.
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    That's what the investment phase is for,
    and it does this in two ways.
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    The investments load the next trigger.
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    So, loading the next trigger, an example
    of that would be, when I send someone
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     a message on WhatsApp I don't
     get any immediate rewards.
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     Right?
     There's no leader boards,
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     there's not badges, there's no points,
     nothing really happens.
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     What I'm doing is I'm loading the next
     trigger because I'm likely to
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     get a reply.
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     >> Right.
     >> And that reply comes coupled with
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     an external trigger.
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     Hey, here's a message from your friend
     which prompts me to use the hook
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     once again.
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     The second way that investments
     increase the likelihood of an x-pass
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     is by storing value,
     and this is a big deal.
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     Storing value is when the product
     gets better and better with use,
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     it appreciates in value.
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     And it does this by storing data,
     followers,
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     reputation, content
     >> Photos.
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     >> Right.
     Anything that I'm putting into the app
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     that gets better and better over time.
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     And so it's through successive cycles,
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     through these hooks trigger
     action reward investment
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     that now an association has built
     with that second type of trigger.
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     Remember I told you there was two types
     of triggers: external triggers and
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     internal triggers.
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     The internal trigger
     are these things in our life
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     that prompt us to action like a place, a
     situation, a routine, a certain person.
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     And most frequently, emotions that
     prompt us to do this next action,
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     this next habit with little or
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     no conscious thought, but
     without any explicit information.
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     So over time,
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     through successive cycles through
     these hooks, now we use the product.
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     Not with a message that tells us,
     hey click here, but
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     >> With a need.
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     >> With a need, exactly.
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     We internally trigger ourselves.
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     We have these associations, so,
     I'm lonely, I check Facebook.
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     I'm uncertain, I Google.
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     I'm bored and
     I'm on YouTube or Reddit or
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     checking stock prices or
     sports scores, right?
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     We do these things instantaneously
     because of the successive cycles
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     through these hooks.