Understanding the Hook Model: how to create habit-forming products

‘Hook, line, and sinker.’ This idiom neatly describes going fishing and influencing customer behavior using the Hook Model. 

The latter is a methodology for capturing digital product users’ attention until they are frequently using a product. Moreover, these users reach a point when using the product is so rewarding that it becomes second nature—it forms a habit. 

For many companies today, the habitual aspect of the Hook Model is their most effective product development strategy. However, if you’re unfamiliar with this approach, there’s much to unpack, including its various phases, implementation, ethics, and more. 

Let’s get to it!

The Hook Model is a four-stage behavioral process companies use to create compelling, habit-forming products: trigger, action, variable reward, and investment. The basic premise is that a particular product's habit-forming nature makes one-time users lifelong customers and generates recurring revenue. 

An entrepreneur, behavioral economist, and author, Nir Eyal described the Hook Model Methodology and its four phases in his 2014 book, Hooked: How to Build Habit-Forming Products. His product development approach is rooted in customers' habitual behaviors. 

Instead of introducing products in reaction to current customer behavior, Eyal proposed creating the customer habit first, connecting the habit need to the product. The looping cycle and its four stages remain a viable digital product development strategy today.

This methodology impacts various aspects of customer engagement and product development:

Understanding customer behavior

The Hook Model is crucial because it provides insights into what drives customer purchasing decisions and behaviors. 

Shaping buyer personas and patterns

As businesses develop buyer personas, analyze buying patterns, and continuously gather client feedback, the Hook Model alters the traditional approach. Instead of just responding to existing behaviors, businesses proactively shape and influence these behaviors.

Creating competitive advantage

The Hook Model's competitive advantage is its focus on establishing customer patterns and behaviors and then developing products that meet those habits (rather than the other way around).

Ensuring product-market fit

By incorporating the Hook Model early in product development, companies can ensure their products meet the needs of newly formed customer habits.

Anytime you want to create a repeat customer engagement, the Hook Model can apply. 

One of the most common examples is the video game industry. Each game developer creates features and gaming experiences designed to take the user deeper into habit-forming territory, ensuring that, in the end, the game itself is a popular success.

However, anytime a company can create a recurring action within its customer base, it harnesses the Hook Model. And anytime you find yourself making a series of user experiences or "hooks" to keep customers engaged and wanting more, you're working toward building the Hook Model habit.

Here’s an overview of the four progressive phases in this model:

1. Trigger (external or internal)

A trigger is a stimulus that prompts a user to take action. Triggers can be external, such as notifications or advertisements, or internal, like thoughts, feelings, or emotional responses that prompt action. Your product needs to initiate a call-to-action that makes the next step irresistible for the target customer. This action is what begins to form a habit.

2. Action

Within the Hook Model, the action refers to the user's behavior anticipating your product's reward. The customer encounters a trigger and then takes the necessary action to satisfy that trigger.

For example, consider your behavior when you receive a social media notification. The notification badge or alert serves as the trigger. When you open the app to read the notification, you are engaging in the action.

3. Variable rewards

These represent the pain point or problem resolved by the action. 

There are a few types of rewards to consider:

Rewards of the tribe

These relate to social acceptance and connection. For example, on social media platforms like Instagram, receiving likes and comments on your posts provides a sense of social validation and connection with others.

Rewards of the hunt

These rewards are about the search for material resources. For instance, in online shopping, discovering a limited-time discount or finding a rare item on sale can be exciting and satisfying, driving users to search and act quickly.

Rewards of the self 

These pertain to personal gratification or mastery. For example, earning badges or completing milestones in fitness apps gives users a sense of accomplishment and personal growth.

Rewards are an essential feature of your product since they create urgency for the trigger. You can’t make the action recurring and form a habit without satisfying the user's trigger with a reward.

4. Investment

In the investment phase, users complete the habit-forming cycle. At this stage, a single trigger-action-variable reward engagement transforms into multiple engagements, enhancing the experience to encourage repeat cycles. Whenever users can invest effort, time, money, or social capital into the experience, they become more likely to seek the reward again. 

For example, consider Pinterest: when users pin their favorite items, they receive a reward in the form of personalized content. By indicating their preferences, users help the algorithm deliver more relevant suggestions, improving their experience. This continuous improvement re-engages users with the hook cycle during each visit.

When developing a hooked product, your team has to base the entire plan around your target customer behaviors. Conduct the necessary research to identify your target users. You can't effectively build a product with the right triggers and rewards without clearly understanding what your users want, need, or prefer.

How behavior design influences user habits

Habits form when customers can solve problems, find convenience, and get rewarded every time they take an action. These behaviors will influence how you design your products or services.

Understanding user motivation in hooked products

You can build in incredible rewards, but if the action isn't easy, reasonable, or aligned with something your target user wants to do, you won't achieve Hook Model success. Understanding their behaviors, including how customers take action with other products and services, will help you develop an action phase.

The power of anticipation cannot be understated when developing a hooked product, especially when creating new habits. A deep understanding of your customer base can help you create triggers, actions, and rewards that best align with their goals. This knowledge involves understanding how anticipation of rewards drives user behavior and recognizing the significance of consecutive hook cycles in building habits:

How anticipation of reward drives user behavior

Once users understand the rewards system, it can motivate them to continue taking action. For example, when digital health trackers assign daily step goals, the user experiences anticipation for the reward at the end of the day to see if they've successfully walked enough steps.

The significance of consecutive hook cycles in building habits

Anticipation can help close the cycle in the investment phase, prompting users to look forward to doing it again. When users re-engage over time, they begin to form associations with internal triggers, automatically cueing behaviors and forming routines and habits. The more comfortable they get with the experience, the more they'll develop personal motivations and emotional connections to the product. These internal motivations, combined with your external triggers, create a stronger compulsion to keep using the product.

Nir Eyal also proposed the Manipulation Matrix as an ethical design tool. Essentially, the matrix helps you ask whether you can and should ‘hook’ users by evaluating how much your product can improve or benefit their lives.

Source: 99signals

Examine whether your product hook fits into one of these manipulation matrix categories:

1. The facilitator: this is the matrix sweet spot. Here, you recognize that your hooked product can materially improve the lives of those who use it. You'd use it yourself and understand the consequences of prolonged use.

2. The peddler: if your product falls into this matrix category, it might improve users' lives, but it's not a habit-forming product you'd use yourself. There might be a few unintended consequences, challenges, or struggles that translate to inadvertent concerns in the future.

3. The entertainer: if your product lands in this box, it's harmless and entirely enjoyable with the intention of being harmless fun. It might be fad-driven, designed to relieve momentary stress or lighten the user's mood. But overall, it doesn't present any long-term improvements that would keep your users returning well into the future.

4. The dealer: you don’t want your product to be here. In this category, the designer believes the product won't improve lives; they wouldn’t use it themselves, and profit is the only benefit. Here is where hooked products intersect with exploitation. Attempting to create an addiction l or, at the very least, a habit that doesn't offer any improvement for the user is unethical.

Before launching your product, run it through the three-step habit testing process, helping identify areas for improvement or modification to encourage healthy habit formation.

1. Identify: use your available data to understand how customers use your product or talk to people about how they might interact with it.

2. Codify: document and code your findings so you can study the behaviors and actions taken by devoted customers and generate new processes to leverage what changed them from one-time users to repeat users.

3. Modify: enhance your offering with your newfound data and findings, encouraging more users to follow the paths of existing customers.

When applying the Hook Model to your product development, consider these essential tactics to ensure success:

• Build empathy into your trigger designs: remember that emotional connections are the strongest and resonate more when you understand your users' needs.

• Optimize your feedback loop: keep your rewards attractive and appealing at all times when you continuously refine your feedback loop.

• Be sure your investment is balanced: strike a balance in how and when you encourage digital product users to invest.

Check out this roster of national and global brands already mastering the Hook Model with digital product offerings.

Uber

A new habit forms when customers use Uber to hail a ride, addressing the inefficiencies and uncertainties associated with calling a cab, taking a bus, or driving themselves. The app leverages the Hook Model by triggering users with the need for quick transportation, providing the action through an easy-to-use interface, offering variable rewards through ride updates and driver ratings, and encouraging investment by storing payment details for seamless future use.

Netflix

Movie consumption has become a binge habit, driving the need for an online streaming platform that shares on-demand movies and television. Netflix employs the Hook Model by using personalized recommendations to trigger viewers, making the action of watching effortless with a simple play button, providing variable rewards through an ever-refreshing content library, and promoting investment by tracking viewing history to improve future recommendations.

TikTok

A new habit formed on existing social media use where users consume bite-sized media, produce user-generated content, and enjoy instant video-formatted gratification. TikTok's implementation of the Hook Model includes frequent notifications (triggers) to re-engage users, the ease of scrolling through videos (action), the variable rewards of diverse and entertaining content, and encouraging investment by allowing users to create and share their videos, thus increasing their attachment to the platform.

Duolingo

Duolingo creates habits with intermittent app reminders about hitting new language learning goals for the day. Duolingo uses the Hook Model by triggering users with daily notifications, simplifying the action of learning with gamified lessons, providing variable rewards such as experience points and streaks, and encouraging investment through progress tracking and personalized learning paths that adapt to the user's performance.

Flo Health

Encourages users to use the in-app menstrual cycle and reproductive health symptom tracker, now with 230 million hooked as habitual customers. Flo Health's application of the Hook Model includes personalized health insights as triggers, an easy-to-navigate interface for tracking symptoms (action), variable rewards through detailed cycle predictions and health tips, and user investment by storing personal health data, which enhances the accuracy and personalization of future insights.

As with any business practice, it's worth considering the ethics of ‘hooking’ people using the Hook Model. While no official regulations govern its use (as of writing this), companies should be mindful of aligning their hook tactics with broader ethics guidelines, such as those provided by the American Marketing Association, and adhering to consumer protection laws.

Recognizing the potential negative impact of addictive products

When considering the ethics of using the Hook Model, it's essential to recognize any potential risks or negative impacts on customers with the new habit you want to create. Cigarettes are a straightforward example of a product that leads to physical addiction. Similarly, we can also recognize the potential drawbacks of excessive digital product use, such as social media addiction.

The responsibility of product managers to avoid unethical behavior design

Within your product development team, product managers are responsible for identifying and preventing unethical practices related to the Hook Mode, including being vigilant about creating features that could exploit users' vulnerabilities and ensuring that the product's benefits outweigh any potential negative consequences.

While the Hook Model can effectively create habit-forming products, it is crucial to consider the ethical implications. Companies must balance the benefits of engaging users with the potential risks of developing addictive behaviors, ensuring their practices align with ethical guidelines and prioritize user well-being.

Related: Guide to ethical considerations in research: overview and examples.

In game design, the hook is the gaming feature or enhancement that draws in existing players to keep playing and appeals to a new user base.

The hook in the Hook Model refers to the characteristic or feature that appeals to the user. The entry point attracts customers to a product or service and moves them through the four habit-forming phases of recurring use.