I have a pet hypothesis which says that it's easier to explain induction using a non-linear order (sometimes this is called well-founded induction), rather than just natural numbers.
Of course, it might be plain wrong, because all the people who benefited from this approach tried to understand induction over naturals first. Still, you may want to give it a try (you didn't say how old your little brother is, the example might be too silly, I don't know).
An escape from mysterious cave
You are an adventurer in a mysterious cave which looks like this (here draw a graph).
Unfortunately, your flashlight died (it's pitch dark) and you got lost.
However, there is a gentle breeze which indicates, for each passage, in which direction the exit is (here direct each edge so that it becomes a strict poset where the exit(s) is(are) the bottom element(s)) - we have to go against the wind.
Prove that you can get away from the cave.
You start with "proofs" that you can escape from halls near the exit, namely producing explicit paths of length 1, 2, 3, whatever necessary.
Then explain that you would like to produce such a path for each hall in the cave, but that would be a tedious task (the cave may have huge number of halls; in math it could even be infinite). Instead, we will show how to produce such a path if we know a path from at least one hall closer to exit.
Induction can be understood as an agreement that such a way of producing paths is just as good as explicit paths.
Now explain why you need base: you can travel inside the cave all you want, you cannot escape it if there is no exit (draw an example).
Explain also why you need all the steps: if some corridor collapses, then possibly some parts of the cave might be cut off (draw an example).
Heap property
We say that a rooted tree (it can be binary, but it's not necessary) has heap property if for any vertex its value is bigger or equal the values of its children.
Prove that the root is at least as big as other values in the whole tree.
Start with drawing an example where values aren't uniformly bigger from one level to the next. Of course, we could take the value of the root and compare it with any other node and that would be enough to prove that in this particular instance it is true.
Next draw an example with symbols like $a, b, c, \ldots$ or $a_1, a_2, a_3, \ldots$. Now we can't compare the root value with any other (we know the inequalities between the parent and its children), but we could write down sequences like $a_{12} < a_5 < a_1$ for each node and it also would be a proof for this instance. However, if the tree is big, that would be tedious. Similarly to the cave problem, instead of providing exact paths you say how to generate them from smaller paths. (Also draw an example where a single node that violates the heap property is enough for the lemma to be untrue.)
And if all is going well, you can then explain how we can do here even better, that is, instead of saying how to generate chains of inequalities for this particular instance, you can describe a way to do it for any tree that satisfies the heap property.
Don't forget to stress why both the base and the step are important. If your brother is eager for more, you can show him how the sum of the first $n$ even numbers is odd, you can describe why all horses are the same color.
If your brother wants even more and you are not afraid to confuse him a bit, you can demonstrate why relation has to be well-founded, e.g. you could prove that zero is strictly bigger than itself.
Consider the set $A = \{1, \frac{1}{2}, \frac{1}{3}, \frac{1}{4}, \ldots, 0\}$. We prove that for all $x \in A$ we have $x > 0$. The base is true, because $1 > 0$. We have that for any $x \in A$ the next element after $x$ is strictly bigger than zero, so the step also works. Hence $0 > 0$.
I hope this helps $\ddot\smile$