Let us break down "first chapter" a bit and look at how readers try to fathom a book, after the title and cover have made them pick it up and the blurb intrigued them to open it.
When readers face a purchase decision in a bookstore, they don't read the first chapter and then decide. Their decision comes in steps, and the book must pass each of these thresholds, or it will be returned to the shelf unread. Let us look at each of these in turn.
The outside of the book
Although you didn't ask for it, I want to briefly mention the outside of the book, too, so we better understand what you must provide on the inside.
The cover, title, author name (!), and blurb each must clearly and attractively communicate to the target audience that the book contains what that target audience seeks. The target audience seeks a genre (e.g. romance), certain character types (e.g. the broken male love interest), certain settings, and certain plot elements (e.g. the love triangle).
The hook starts on the outside of the book, and what you call the "first chapter" only deepens it. For you, as a writer, this means that you must develop an intriguing premise, for that is what the book's outside communicates (and what the cover illustrator and blurb writing marketing department need from you).
The first sentence (or two)
When a reader opens a book in a bookstore, the first thing they look at is the first sentence. In a well-crafted book, the first sentence contains the theme, that is, in what way the story is relevant to the life and person of the reader. Let us look at an example.
Ally Condie's novel Atlantia – which happens to be the top-most book on my pile of books to read – opens with this sentence:
My twin sister, Bay, and I pass underneath the brown-and-turquoise banners hanging from the ceiling of the temple.
From this first sentence we learn that the book is about sisters and how their relationship is affected by the traditions of their society. It is a fantasy novel, and its premise is how a teenage girl living in a colony of humans that has survived the apocalypse underwater uncovers "the mysterious history of her own family, and the Divide that created [the colony,] Atlantia", but the theme of the book is sisterhood. It ends with: "We are sisters, and we did not drown."
The first page
When readers are hooked by the first sentence, they read (or skim) the first page. The first page establishes the setting and the character of the protagonist.
The first few pages
If the reader finds the first page interesting, they read (or skim) the next few pages to get a general idea of the obstacles the protagonist has to face or what task he is given or what else drives the plot.
The rest of the book
Yes, the rest of the book may be part of "the first chapter", too.
If the outside and the first few pages appeal to the reader, the reader will either buy the book, read on, or check other places in the book. What I do, for example, is find examples of dialog. Many good books are ruined, for me, by unnatural dialog. I always make sure the writer can write good spoken language, before I buy a book. Others will look for other things. As a teenager I wanted a sex scene, so I looked for that and whether it was well done (by my standards).
how to engage the audience,
there is no general answer to that. Different audiences want different things, and what engages one person repels another. I cannot for the life of me read Terry Pratchett, his writing makes my face sag with unfunniness, while others find him addictively hilarious. A high stakes novel needs the stakes (death!) in the first sentence, a romance needs a spark of sexual attraction, a hard science fiction novel needs an intriguing idea, and so on.
If you use the guide I have created and look at how novels in the genre you are writing fill these places – the first sentence, the first page, the first few pages –, you will, I am sure, understand how they hook their target audience (you!) and from that understanding be able to emulate their approach.
There is a lot of great advice on the web on how to create a killer opening line for your novel, but what has really helped me the most was the idea that the first sentence contains the theme of the novel and that the theme must be what my target audience is struggling with or desires or fears – that is, most intensely feels about – in their lives. Finding this theme in your own writing helps you greatly with identifying who you are writing for and building a strong thematic backbone for your plot.