Habit forming App's

After being introduced to skillshare (http://www.skillshare.com) during one of Professor Nelson's lectures I decided to visit the site to see if any of the posted resources would be helpful in building out my app business. I have found a number of online resources that have helped me through out the process of creating my business plan and skill share has proven to be a site I will continue to utilize during my entrepreneurial process. I came upon a 2 hour course, broken down over 7 sessions, titled "How to Build Habit Forming Products' by Nir Eyal. Nir is a silicone valley entrepreneur who has sold two start ups, Sunshine Valley Business Development and AdNectar. Nir's talents are focused on researching the crossroad where technology and psychology meet. His presentation on skillshare is based off of his book of the same name "Building Habit Forming Technologies". 

Nir's presentation is built off of the premise that in order to build a successful tech product you need to create a product that addresses a burring need. This is the painkiller (burning need) vs. vitamin (may help but we don't know) analogy that is introduced early in the presentation. Nir then defines a habit as "when not doing something causes pain". Nir encourages the user to consider this information in building a technology product and ask ourselves "how can we create a product where habits can be used for good". I found this concept to be particularly intriguing as much of the motivation I have for building a suite of apps is to help users who are contract workers or small business owners to have the same level of resources and knowledge available to them that larger business's have in an easy to use platform that does not require expensive, specialized training. (think of Quickbooks for example expensive investment in software that then requires additional training)  One challenge I am facing in my business plan is identifying how I can attract a steady stream of users to purchase my apps and have these same users return to buy additional apps that are available to purchase. In order for my proposed sales model to be successful I need to have returning users purchase additional products as well as have users become evangelists for my product by recommending my products in their respective communities. 

In order to develop a habit Nir identifies two important actions that must be present; frequency and attitude change. Nir's theory is that in order to be a very successful tech product user's need to engage with your product more than 1x per week. If your product requires less then at least weekly interaction from the user it will be nearly impossible to create the a "habit" level of engagement. Creating habits for your customers creates a higher lifetime value for your product (ie. essential for favorable VC valuation), enables the owner to change the pricing models if necessary; both features which are important to the growth process of the company. The second piece, attitude change, is all about being able to have your customer base be amenable to seeing things differently. An exercise is introduced to reinforce these concepts and asks the company to describe their business model and the habits formed around the business model and then articulate why the business model requires these habits. You are then guided to take ten minutes to ask yourself what problem you will solve and how the problem is currently solved.  Having completed this task early in my research and development phase I moved ahead to the next concept and the core concept of the course, creating the Hook. 

The Hook is essentially a continuos four step process of Trigger, Action, Reward and Investment. In order to build a product that becomes a habit for the consumer it needs to possess all four phases of the hook process. In finalizing my product description for my business plan I am going to incorporate this process into the product description section and in each app design. Understanding this process has also helped to give me direction on what supporting features I need to develop to support my app. Creating a robust website where users can connect, share their experience and read content devoted to topics that impact small business's and commentary that breaks down how issues/laws/regulations impact the small business owner. This article also inspired me to think about how to incorporate user badges and recognition for users who contribute and create incentives for them to deepen their engagement with the product set and the brand. During the competitor research phase of my business plan I did not find that app developers supported their product by building community forums, had strong website support, or offered incentives/rewards for deepening customer brand engagement. 

The last important concept that I will leave you with is the idea that technology products have the ability to appreciate in a way that is different from typical consumer goods based on how the user engages with the product. If you incorporate into your business model a habit forming product that allows the user to store content and data in the product it's value will continue to increase. When we enable users to invest in the product by contributing their time and data to the product it changes their perception of the product. It also increases the likelihood that the user will return to the product and allowing the Hook cycle to take place again. 

There was a significant amount of content in the "Building Habit Forming Products" and I recommend that anyone developing a product take time to learn about this concept and understand how they can incorporate these principals into their business model. As I continue to work these concepts into my product I will continue to update this blog.