Consumer Habits: The Key to Success or Failure

This article is an excerpt from the Shortform summary of "Hooked" by Nir Eyal and Ryan Hoover. Shortform has the world's best summaries of books you should be reading.

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What are consumer habits? How can consumer habits inform product design?

Consumer habits are what shape the way customers need, want, and use products. Ideally, your products are integrated into the habits of your customers.

Read more about consumer habits and their importance.

What Are Consumer Habits

When a habit is established, the user comes to crave the solution before actually receiving the reward. In the brain, the nucleus accumbens is responsible for dopamine signaling to reward behavior and set habits. Brain imaging studies have found that signaling was activating not when actually receiving the reward, but rather in anticipation of it.

Depending on whether you believe your product improves the user’s life and whether you use the product yourself, you fit into these profiles:

Facilitator

You create something you would use and earnestly believe makes the user’s life better. These tend to be healthy habits.

You cannot consider yourself a facilitator unless you’ve experienced the problem yourself.

Because you have the problem yourself, you know the user well, and are often best positioned to solve the user’s problems. This increases your chance of success.

If it’s something you would have used earlier in life but wouldn’t today, then the longer the time difference, the lower your odds of success. For instance, if you’re building a product for apartment renting, but you’ve owned a house for 10 years, you’re likely out of touch with what users want.

There is still a risk of addiction for even the most healthy products, but luckily the rate is low (<1%), and the benefits likely outweigh the cons.

Peddler

You create something you don’t use yourself, but you believe improves the user’s life depending on consumer habits.

Don’t fool yourself – ask yourself if you honestly believe the product benefits the user’s life, or whether you’re just rationalizing something you know is bad.

Because you don’t have the problem yourself, you have to take extra leaps to imagine the user who’ll find the product valuable.

You may also have the hubris that you can understand someone who’s unlike you, when really you may be completely off base and building something no one wants.

You operate at a heavy disadvantage because of your disconnect with your customers and their needs, which makes your product feel inauthentic. This lowers your chances of success.

Common examples include advertising to a market unlike yourself, too-good-to-be-true products.

Entertainer

If you just want to have fun, but can’t honestly claim it improves lives, it’s entertainment.

Entertainment, like art, is important, but tends to be fleeting because they don’t consistently improve people’s lives. They tend not to be habit-forming products – you can only watch a movie so many times, until you seek the next dose of novelty.

This is why entertainment is a hits-driven business. Demands shift, become unpredictable, and don’t form reliable consumer habits.

Sustainable businesses here come not from the content itself or the user’s habits – they arise from effective distribution to get to more users while they’re still hot, and continuous novelty to keep feeding interest.

(Shortform note: entertainment that has other variable rewards, like a social community and infinite variability, are more likely to form persistent habits – like online role-playing game World of Warcraft, or the large content library of Netflix.

Also, this categorization is subjective – some game developers are facilitators who honestly believe their games honestly improve the world, but their games are subject to the same properties as games by developers who are entertainers.)