Larry Page, CEO of Alphabet (the company formerly known as Google), has a quirky way of deciding which companies he likes. It’s called “The Toothbrush Test.” According to the New York Times, when Page looks at a potential company to acquire, he wants to know if the product is, like a toothbrush, “something you will use once or twice a day.”
Page clearly understands habits.
As I wrote in my book, Hooked: How to Build Habit-Forming Products, frequently used products form sticky customer habits. But what if your product doesn’t pass Page’s Toothbrush Test? Perhaps you’d like people to use your product or service frequently, but it just doesn’t make sense to do so.
A few months ago, I was hired to present at a gathering of 700 real estate agents. The master of ceremonies made a gracious introduction, saying, “Now we’ll hear from Nir Eyal, an expert on consumer habits. Nir is going to teach us how to make home buying and selling into a habit!”
The breath went out of me like I’d been punched in the solar plexus.
I trudged on stage and gripped the podium. “I’m sorry,” I said. “There must have been some misunderstanding.” I paused to catch my breath. “There is no way I am going to teach you how to make home buying and selling into a habit, because it has no chance of ever becoming a habit.”
I glanced over my shoulder trying to find the woman who’d introduced me, hoping she’d save me, but she was already slinking off the stage. I was stuck. I hadn’t prepared another talk, so I gave the planned presentation, based on my book.
I explained that home buying and selling doesn’t occur nearly often enough to become a habit. Furthermore, the very definition of a habit — a behavior done with little or no conscious thought — is the antithesis of the kind of overthinking that real estate transactions inspire.
As I finished my talk, I expected crickets. Instead, I received a generous round of applause and a small mob of real estate agents gathered around me as I got off stage. As the lights came up and the convention adjourned for a break, the agents peppered me with questions. They all had ideas to share.
“I know home buying and selling can’t be a habit,” one woman spoke up. “That’s fine. But what if I make a habit of doing something else related to home buying and selling?” I was intrigued.
Soon, other agents chimed in and built upon each other’s ideas, coming up with all sorts of ways to keep potential customers engaged. Their ideas helped me realize that even infrequently used products and services can keep customers hooked.
There are at least two ways to build a habit around an infrequently used product: content and community.
However, let me be clear: Not every business needs to be habit-forming. There are lots of ways to bring customers back, and many companies succeed without relying on customers’ habits. They buy advertising, spend money on search engine optimization, or open a storefront to capture customers’ attention as they walk by. But traditional methods of keeping customers engaged force businesses to rent space on someone else’s website, search engine, or street corner. By contrast, owning a customer’s habit is an asset that pays you.
So, how do infrequently used products bolt on a habit-forming customer experience? The first way is by making a habit of consuming great content.
“Every time someone in my neighborhood has personal finance questions, I want them to come to me,” one real estate agent told me after my talk. Her plan was to create a site and app full of articles, videos, and financial calculators to form a content habit with potential home buyers and sellers. “What if I write new articles or post the ones I find online about topics I know people have on their minds?” she asked.
I nodded in agreement as she described building a site that would teach people to come to her for information that would help them make financial decisions. If she could build potential customers’ habit of consulting her site, she could increase the odds of people transacting with her when the time came to buy or sell their homes.
She had stumbled upon a tactic used by Y Combinator, a company the New York Times called “Silicon Valley’s Start-Up Machine.” Y Combinator is in the business of finding promising young tech companies and helping them become the next AirBnB or Dropbox (both Y Combinator companies).
Though Y Combinator has sealed its reputation at the top of its industry, it was once a newcomer competing for attention with traditional venture capital funds and angel investors. Even today, Y Combinator’s success depends on finding the best founders, which means staying top of mind. But founders don’t apply to Y Combinator frequently enough for it to be a habit.
How does the startup accelerator stay connected to the tech community? The answer is content.
Hacker News, a content aggregation site owned by Y Combinator, was visited 18.6 million times in July 2016. Hacker News went online in 2007, less than two years after Y Combinator’s founding, and has been a fixture of Silicon Valley tech and culture ever since. Though it’s not Y Combinator’s core business, it has successfully drawn attention to the accelerator by forming a content-consumption habit.