How to make products with a happy ending

Nir Eyal, one of the most influential mentors I have, just published the book Hooked: How to Build Habit-Forming Products . You can download it for kindle for free until December 31, 2013. My review is Amazon site  For convenience, here it is 

When I downloaded the book, I recalled this quote from Nir Eyal blog, NirAndFar:

"A funny thing happens when you lie to people: they tend to believe. Why shouldn't they? They lie to themselves all the time. Our minds are wired to respond in predictable ways-among them is perceiving the world the way we want to see it, not necessarily the way it is."

Does this book lie? Well Nir gives us facts. He describes the way we reach user hearts and brains, in the same way perhaps Bob Dylan music hooks you on.. What is a Habit? ("automatic behavors triggered by situational cues..things we do with little or no conscious thought"). A habit-forming company, says Nir, links its services to the users' daily routines and emotions.

Nir Eyal teamed with Dr. Baba Shiv to design and teach a course at Stanford Business School, on the science of influencing human behavior. This is how the Hook model was created. It is well described right at the beginning, and each step is analyzed thoroughly in subsequent chapters. Nir dedicated also an entire chapter to discuss the morality of manipulation. The irresponsible use of habits creates bad habits that may degenerate.

This is not the reason the Hooked model in product management was created.
What is CLTV? It stands for customer lifetime value. This is the ammount of money made from "a customer, before she switches to a competitor, or dies". User habits then,, increase the CLTV.

Nir quotes a paper by John Gourville from Harvard Business School "Many innovations fail because consumers irrationally overvalue the old, while companies irrationaly overvsluer the new"

Kindle has this feature that one can see how many people highlighted a paragraph. This quote had 26 highliters in 72 hours. It says why, for new entrants, they can't just do better, they must be nine times better.. Why is this? Because old habits die hard.
Even if "the benefits of using a new product are clear and substantial", if the use of this products require a high degree of behavior change, they are doomed to fail.

To me this is clearest and most lucid explanation on why the attitude "we want to be the best of class" - by challenging an existing market leader, aka a "me-too" application - fail 98% of the time. It is also why, writes Nir, users did not leave Google to move to Bing in significant numbers.

Nir goes over the Fogg Behavior Model, one of the most lucid model on how to remove obstacles that stand in the way of users adopt a product. The technology to achieve these results are based on the teachings of The Stanford Persuasive Technology Lab which "creates insight into how computing products ... can be designed to change what people believe and what they do."

After at length descriptions of each element of the Hooked habit builduing model, Chapter 6, What are you going to do with all this?" is a must read. Before I wrote this review, I watched the movie "Silver Linings Playbook" where a character named Pat  (Bradley Cooper) threw away all books that did not have a happy ending (like Hemingway's "A Farewell to Arms")

This is why Holywood's movies reach our hearts. We have enough strugles and tensions in our real life. We buy a habit forming product, because we like it. We like the iPods and Androids. We like FB and Google. The book by Nir Eyal teaches us, the product creators, how to make a product with a happy ending for everyone, Thus we elevate the quality of our lives.

Nir Eyal