Imagine one of those food subscription services that sends you the ingredients to easily make meals at home — we’ll call it FoodBox. You sign up for a FoodBox subscription that sends you five dinners for the week, and the box arrives the following Monday.
As it turns out, some of the recipes are too tricky for you to cook — you have a small kitchen and a toddler to keep track of, and you can’t “stir constantly” for 20 minutes while you watch him. To make it worse, your young one doesn’t like the leafy greens included in the meals, and you go to the gym on Mondays, so you can’t cook that night.
As a result, you’re throwing away half the meals you’re sent, and you start to worry that you’re wasting money. Frustrated, you cancel your subscription.
All the people at FoodBox can tell is that you signed up, took delivery of a package, and then canceled — but they don’t know why. If they’d had a Customer Success team, they could have reached out to you to see how things were going.
Maybe they could have changed your delivery date so that you were cooking on the weekends when you had more time. Maybe they could have adjusted the recipes to make them easier to cook while you’re busy. If they knew your subscription wasn’t working for you, they could have predicted that you were about to cancel and worked to keep you. But in this scenario, there was no point of contact for you to voice your concerns to, so the opportunity for intervention to help with your adoption was missed.
We all know that product adoption is important, but the actual metrics you should be keeping an eye on are often neglected. Onboarding is a planned, structured process, so it’s tempting to hand off the product to the customer and assume they can take the wheel from there, but customers often need more help to get up and running.
Here are a few key questions to keep in mind about your adoption maturity:
Adoption is crucial to your Customer Success strategy, and vice versa. Customer Success is about making sure that your customers are getting what they want out of your product. If the product is meeting their needs, they’ll adopt it — weaving it into their everyday workflows. If the customer never really feels enthused by your product, they won’t renew.
It’s worth mentioning that adoption looks different depending on the product, the customer, and the company, so it doesn’t always fit in a neat box. It’s also fluid — turnover, strategy, and your product itself can change over time, so the definition of adoption will change with them.
For any product though, there should be a point when you can tell that your customer is fully up to speed and cruising along nicely. Whether it’s through usage data or whether they simply told you, it’s important that you define what adoption is so you can look out for it when it happens.
The goal is to identify the signs of renewal and churn before they happen. Maybe onboarding didn’t go very well, the end user inherited the platform without fully understanding its value, or they just never got the hang of the product. You should be able to notice certain patterns — for instance, maybe customers who use a certain feature more than once a week usually renew — that you can track in order to ensure adoption and mitigate churn.
Adoption monitoring is also hugely beneficial to product feedback. You’re not just looking at adoption of your product or service as a whole, you want to know which specific features are being adopted. That information will help your product and sales teams understand what customers like and don’t like about your product.
Finally, measuring adoption is crucial to making sure your customers are getting the ROI they need. Every customer who invests in your product has a need in mind when they sign up, and whether they adopt will depend on whether they feel that need is being met. A combination of data insights — how many users are logging in, how often, and what features they’re using — and tracking what the customers wanted to begin with will help everyone get on the right path.
Adoption rate is the most basic metric of adoption, but it’s a useful baseline number to have in your back pocket. The adoption formula is:
Number of Adopted Users
Total Number Of Users
If you have 1000 users and 250 of them have adopted your product, your adoption rate is 25%.
In order to use this formula, you’ll have to establish what your definition of an “adopted user” is. Some of the formulas later in this post can help with that, but in most cases it will be specific to your company. For example, you could say that a customer who has completed your onboarding and has 75% of their users logging in on a daily basis has adopted.
This metric can be used to measure the adoption rate of your product as a whole or the adoption rate of a specific feature, and is usually tied to a specific time period. If your company measures adoption on a month-to-month basis, you could adjust the formula above to calculate monthly:
Number of adopted users between March 1 and March 31
Number of total users between March 1 and March 31
Time To First Key Action/Depth Of Adoption
Another good metric to judge adoption is how long it takes users to start using a given feature. Most software products have different levels of complexity that customers will start using at different times — new Gmail users will likely send an email with their account almost immediately, but might never get around to setting up a vacation responder or custom signature.
What constitutes a “key” action depends on which features provide the most value, or which features lead to usage of other features. Maybe you want to measure this number for a very basic feature to see if customers are even starting to use your product at all. Maybe there’s a specific feature that’s a good predictor of adoption. Or maybe your product team wants to know if one of your more obscure features is worth the upkeep. The formula for depth of adoption is:
Number of users who adopted X feature
Total number of active users
You can measure this metric broadly or over a specific amount of time, depending on the need. You can also compare the adoption of a specific feature to your definition of an adopted user to see if that feature should inform your definitions going forward.
Time To Value (TTV)
TTV is often used as an onboarding metric, but it’s also useful in terms of adoption. If there’s a particular feature that customers tend to get the most value from, you should make a point of encouraging the quickest path to that point. Let’s say there’s a specific report that customers want to see once all their data has been imported. How quickly can you generate that report?
Satisfaction, Proficiency, and Usage
These three metrics don’t exist in a vacuum — examining how they relate to each other can give you a lot of great insights and help you focus on the right areas.
Satisfaction measures how useful users find their current system. You’ll need to survey your customers or get them on the phone to obtain this info, but you can easily quantify user satisfaction across a number of variables to figure out which attributes lead to the highest satisfaction.
Proficiency describes the level of expertise your customer has with your product. It can be captured by examining usage data or by having a one-on-one conversation with your customers, and can tell you if your customer is using more complicated features or just sticking with the simple ones. If your customer is struggling, this might be a good time to revisit training.
Usage numbers are tracked internally, and will include metrics like number of users, usage times, login frequency, which features they use and how often, and so on. Usage is a great metric to keep an eye on, but be careful of the false positive element. Sometimes, customers will use the product heavily right up to the time they leave, so keeping an eye on your customer is critical, even if usage levels are good.
By themselves, these metrics are useful, but in combination, they can give you a more complete picture — if customers are satisfied, proficient, and using the product, they’ve adopted.
All this adoption data isn’t much good if you’re not using it. You might be capturing a lot of data, but how are you analyzing it? And how are you taking action based on the outcome?
If your users report high proficiency and satisfaction but usage of a certain feature is low, then maybe that feature isn’t necessary. If satisfaction and proficiency are both low, the onboarding and education of your customers might need to be revisited.
If you’re not measuring the data surrounding customer adoption, you may not have a clear picture of what your customers want — and that can lead to churn. And as a very important bonus, using all that data intelligently will keep your team and your customers from spending valuable time focusing on the wrong areas.
Measuring adoption and the metrics that surround it helps you meet customers at their own proficiency level, prevent them from being discouraged, and keep them happy with your product and your business — and like we always say, a happy customer is a repeat customer.
Think back to your first smartphone. Unless you’re one of the first people to buy an iPhone, way back in 2007, there was probably a time when you thought a smartphone was unnecessary. All those features were flashy, sure, but who needed it? You’ve got calls and texts on your current phone already.
When you first got a smartphone, you may have thought it was nice, but not necessary. Sure, you’d look things up while you were on the move, but you could live without it. Now, all that has changed. You need your smartphone — you probably check it over a hundred times a day for work and personal reasons alike. Somewhere along the way, you adopted it, and now it’s irreplaceable.
But how does the manufacturer know when that moment happened? They can’t just ask — you probably don’t know yourself when that tipping point occurred. Gauging adoption isn’t a simple task, but it’s important. Adoption predicts renewal and repeat business, so your business needs to have a sense of what it looks like.
Once you’ve figured out how adoption usually comes about, you can start to examine prospects and new customers and predict whether they’re on track to success. Here are a few things to keep in mind.
A customer who’s truly adopted your product will be using it — probably more often than one who’s still undecided about the value you provide. You should be able to examine the usage rates of your customers to establish a threshold for adoption, then sort your customers by daily, weekly, or monthly login.
If your customers aren’t using your product or service as often as you’d like, it may be for lack of knowledge on what your service can do. Email reminders to infrequent users about the features they’re not using can be a great way to boost adoption rates.
Keep in mind that “in their day-to-day” doesn’t mean “every day” — a payroll administrator might only be logging in once a week to approve hours, but that doesn’t mean the software isn’t crucial to their job.
A Customer Success Automation tool can be a critical function in measuring usage data at adoption time, and automating the communication triggers to your end users via e-mail, in-app notifications, and reminders to reach out personally. These tools can also learn patterns over time, and give you insights as to what adoption behaviors drive outcomes, good and bad.
As with any adoption metric, there’s no hard-and-fast answer for how often customers should be logging in. You’ll have to establish your own benchmarks, based on past users who renewed, and compare current users to those numbers.
A simple login to look at a dashboard isn’t the same thing as organizing tasks, setting up workflows, installing on multiple machines, or other signals of comprehensive use. Look at past usage patterns first to get a sense of what kind of behavior is usually indicative of higher adoption, and then look for that same behavior in your current customers.
Your onboarding process will strongly affect how your customers use the product — if they’re not using a given feature, they may simply not know how. “Time To Onboard” is a KPI you should be tracking — it’s simply the number of customers who have completed the onboarding in the time you expect divided by the total number you onboard — and it’ll give you a good sense of who isn’t finishing the process as quickly as they should. Customers can’t adopt the product if they don’t know how to use it, so you should be focusing your attention on those who might need extra help.
Your customer picked your product or service for a reason — something they expected to get out of your product that will help them do their job or serve their customers. They might love your product and find it easy to use, but if it’s not delivering the results they need, they won’t keep renewing. You need to set up a way to track outcomes — after all, the core of Customer Success is making sure your customer is successful.
The most useful KPI to track here is Time To Value (TTV). We explain TTV in more depth here, but it’s essentially the amount of time between a customer taking an action and seeing the value of that action. In this case, it’s the amount of time between a customer making an initial purchase (or trial download) and getting what they want out of it.
You’ll need to lean on your sales team and CRM to keep track of what each customer wants to get out of your product — it’s not the same for everyone. Divide them into categories and monitor when they start getting the utility that made them sign up in the first place.
Also, keep an eye on potential early issues. Have they opened a lot of tickets? Is the low usage due to a need for further training? If the client is feeling pain early on, clients will quickly question if they’ve made the right decision.
Your product will dictate the answer to this question — some products are adopted easily, after which usage is sustained rather than increased. Other products are more complicated — customers will begin to use them more and more over a longer period of time.
Your product adoption curve will vary depending on the exact service or product that you offer, but you can look at your past customer history to find the points at which your customers generally upgrade or renew their service.
Tracking continuous adoption will be easier if you think of different levels of use as different products entirely. KPIs like usage rate and TTV can be broken down to each feature to create a timeline for how quickly you expect your customers to ramp up their usage. If they’re not using more features over time or aren’t taking advantage of new features as quickly as you’d like, it may be worth giving them some extra onboarding attention.
There’s nothing wrong with a product with a long adoption curve, as long as expectations are managed and the customer starts to see benefits early on.
Adoption cycles and renewal cycles don’t necessarily have to match up perfectly, but if they don’t, you need to bridge the gap. A customer who isn’t fully realizing the potential of your product before they arrive at the renewal phase might think that your product doesn’t meet their needs, or doesn’t have the features they expected.
This is another reason why tracking TTV is so vital. If you’re celebrating the small wins with your clients, even though there’s still more work to be done at renewal time, the initial value should be clear.
Your job will be to assess their adoption profile before the renewal phase comes along, comparing them to past consumers to see if their adoption has progressed enough to make them likely to renew. If they haven’t, you might need to change your onboarding strategy to get customers to integrate your product into their workflows more quickly.
There’s no master template for how your customers should adopt your product — the rate at which they adopt and the depth at which they utilize your service will be unique to your particular business. Often, adoption is neglected after on-boarding, when in fact, the point at which your customers are leveraging your product independently is likely when they need the most monitoring.
That’s why it’s so important for you to establish these benchmarks yourself. Use your hypothetical ideal customer, rolled together with historical data from existing customers, to track the way that customers use and adopt your product or service between onboarding and renewal. The better you can understand that cycle, the better you’ll be able to appeal to people who are still on the fence, preventing churn and fueling sustainable growth.
Your customer has bought your software, and they’re excited to dig in and start using it! But, how do you avoid the pitfall of managing their onboarding via a standardized checklist driving toward a timely go-live, and then moving on quickly to the next customer?
Jennifer, our resident onboarding expert, coined the “Tupperware Cupboard” analogy. We all have the dreaded Tupperware cupboard — a jumble of containers in various sizes along with a pile of lids haphazardly shoved into an ill-fitting space, just waiting to dump out onto the floor. Sure, you can shove that one last lid in there, slam the door, and assume it’s someone else’s problem now.
When it’s time for your roommate to put the leftover lasagna in the fridge, that cupboard might have everything they need in it. But, you know good and well that the moment they open that door, everything will come tumbling out. The pieces are there, sure. But they’re not usable yet (plus your roommate has a mess to clean up).
This is not unlike checking off all those onboarding checklist items and then quickly handing off the customer to Support before moving on to the next project. Making sure your clients can open the cupboard and find what they need quickly is critical. Understanding your client’s Time to Value is key to avoiding the mess, and ensuring they are delighted as early as possible.
So, let’s talk about Time to Value (TTV), how to track it, and why it’s so critical.
Time to value, usually shortened as TTV, is the amount of time between when a customer takes an action (makes the purchase) and when they see the value of that action (uses the product in a meaningful way).
Your customer’s TTV varies, depending on your product or the service. Some SaaS products are designed to improve the day-to-day operations of a business, so their TTV will be near zero. Others, like accounting or inventory software, might not show their true value until the end of the quarter or until tax season rolls around.
To keep up your business’ momentum and show your customers the ROI that you offer, you need to keep track of your TTV as a key metric.
It’s your job to show the customer the value that they’ll get out of your product — not their job to find it. That’s the role of onboarding. If your customers can’t figure out how to use your product, they won’t. With the exception of services that customers hope not to see the value of — data backups, home security systems, and so on — most services are intended to be used. If customers can’t see that their money is well spent, they’ll churn, switching to a competitor.
Your marketing is all about showing prospective customers what you can do, but after they buy, they still need to learn how to do it. Whether that’s through in-person demos, tutorials, or a simple welcome email, your job is to hand off the product in a way that lets them hit the ground running as smoothly as possible.
As mentioned above, TTV can vary greatly depending on your clientele, the services you offer, or even your customers’ customers. Remember, we’re not talking about the moment the customer becomes valuable to you. TTV is about when you become useful to them, and that means different things to different people.
Your software has a lot of different features, and customers don’t prioritize them all the same. You’ll need to keep track, all the way through the sales process, of what each customer’s particular priorities are. Since TTV is so variable, it makes sense to keep track of several different types.
Time to basic value will be the shortest TTV metric that you measure — it’s simply the time it takes for your customer to realize they made the right choice. The customer is starting to see the most basic amount of value from your product, but they’ve yet to fully utilize your software or realize just how much you can do for them.
For some customers, time to basic value will come before they’ve even spent any money — a customer who signs up for a free software trial and sees that it’s exactly what they were looking for is already experiencing basic value, even if they haven’t subscribed to a paid account yet.
Time to exceeded value is the time it takes for your product or service to exceed your customer’s expectations and convince them to keep doing business with you. This might come when their free trial no longer meets their needs and they decide to sign up for more features, or after you complete a major project that shows a clear return on investment.
Exceeded value is so important because it shows your customers how much you can contribute — they’ll start to realize that they can’t (or don’t want to) do business without your service, increasing their lifetime value to you as they start to see you as a necessity rather than a luxury.
Some SaaS products and services don’t make their value apparent as immediately — it might take weeks or months to fully implement database, accounting, or inventory software to the point that it can be used day-to-day.
If your service has a long time to value, it’s important to show your customers what you’ll offer them in the meantime. Congratulate them for signing up, and start to offer instructional downloads or videos so they can hit the ground running once onboarding is complete.
Let’s say the implementation has a lot of work and phases, TTV can often begin before deployment. Once the data is populated in the tool, maybe they can start seeing reports! Leveraging a demo instance? Clients love to start to see things coming together! Two keys:
Ask your customer what they’re excited about and focus on it.
Highlight progress early and often.
Short time to value is much easier for customers to wrap their heads around. They have a need, they hire a company to meet those needs, and their needs are immediately met. If the carpets in your office are dirty, you can get a carpet cleaning company to come in in a few days and clean them.
The problem with businesses and markets that have a short time to value is that customers have less patience — if someone else can do the same job faster, they’re much more likely to switch. If your carpets are dirty and Company A says they can come in next week, but Company B can be there today, your loyalty for Company A will go out the window.
Some services are able to provide value with no onboarding or transition period at all. If you go to Hubspot’s website grader, for instance, you can paste in a URL and get SEO feedback within seconds. Because the TTV for this service is instantaneous, users are more likely to keep coming back to it.
Reducing your TTV is a good goal to have — a short TTV allows you to develop new features and adapt your sales cycle. But in order to reduce your customer’s TTV, you’ll need to be able to track that moment when customers realize the value of your service.
The most brilliant product in the world is useless if your customers don’t know how to use it. Whether you offer a product with immediate time to value or long time to value, you need to get your customers interested enough to keep using your product.
That’s where tutorials and onboarding guides come in. Customers picked your product or service for a reason — they had a need that they wanted to address — so creating helpful tutorials and guides to show them how to address that need will give them the confidence and independence they need to keep using your product.
The onboarding process is your opportunity to re-emphasize the value you’re bringing to the table and show the customer how you’re delivering on the features that attracted them to you in the first place.
This step is especially important if you have a product or service with a long time to value. If your service provides data backups in case of physical server failure, your customer hopes never to have to use it. But showing them the progress of their backup, telling them how backups are protected and kept redundant, and explaining to them how they can use your backup software in case of emergency will give them a sense of value, even if they’re not technically using your service yet.
Case studies are a great way to show your new customers your value, even if they haven’t realized it themselves yet. Reading about a similar company in a similar situation who achieved the results they wanted will reassure your customers that the longer time to value is worth the wait.
You can tell them your value propositions or talk about your “extensive experience” ad nauseum, but there’s nothing like real-world examples to really prove your point.
If an implementation is long, generally a timeline is being leveraged to keep all project stakeholders on track. If on a totally separate timeline you’re tracking your customer’s TTV, this can be a great way to show them that you’re really focused on their needs and that you’re listening. Instilling that level of diligence and focus on their business will go a long way early in the process.
Time to value isn’t often considered one of a business’ most important KPIs, but it should be — TTV can provide useful insights that you just can’t get anywhere else. After all, your interaction with a customer doesn’t end when their check clears — you need to keep them informed, engaged, and satisfied if you want to convert a one-time purchaser into a repeat buyer, a long-term subscriber, or an advocate for your brand.
Time to value gives you a way to do that. By measuring the time between a completed purchase and the realization of value from that purchase, you can decide exactly when to engage, when to offer help, and when to nudge customers to renew their subscription. It’s only by understanding how your customers interact with your product that you’ll be able to convert single purchases into loyal patrons.
If you’re onboarding a new customer, that can only mean one thing. You did it. You made it. You beat out all of your competitors. They chose you, and now you know, they like you. They really like you! But now it’s show time for your product and Customer Success team, and if you don’t keep it together, you could just as easily lose that customer.
Before you go any further, take a moment to reflect on your current customer onboarding process with two things in mind — the two biggest reasons people often mess up this stage in the customer success (CS) lifecycle. They are (1) onboarding a new customer is complicated and (2) focusing on the wrong things is easy.
Did anything jump out at you? Are there elements in your company’s onboarding process that are glossed over or murky? Are there neglected components within the customer experience? If so, you are not alone. Don’t feel bad because you can course correct. Besides, if every business had it down to a science, I wouldn’t be writing this post.
However, there is hope.
Instead of simply flipping the onboarding switch and leaving your new customer to dangle in the wind to inevitably become just another customer churn stat, invest in purposeful customer onboarding. This approach integrates desired customer outcomes and deep insights about what customers expect from you. It takes a comprehensive plan to do it, but it results in productive interactions and empowers customers to use your product to its maximum potential.
Your sales team dazzled and wowed your new customer enough to get them to take the plunge with your company, it’s on you and your team to keep the momentum going. To do that, start with the following three fundamental questions…
It is critical to learn from sales what pain points and/or business outcomes drove the company to work with you, so jump in with at least one thorough conversation. Focus on the key areas that are most important to the customer from the start. Figure out if the purchaser and end user are the same. If not, you may need to re-sell a new stakeholder (or a team of them) on the value of your product.
Setting expectations is critical in this phase — for your customer and your internal team. Adequately allocate time and resources to the customer and their needs. Align everyone on a timeline, stay organized and keep your customer well informed.
Only focusing on your own targets and metrics while working with customers is an easy misstep. They’re important, of course, but your customer’s little wins along the way are significant, too. Be sure to mark the milestones that boost customer excitement and interest.
All of those questions boil down to one big job for you and your CS team — make your product as valuable to your customer as possible. It’s your job to set customer expectations, drive them toward success, and ensure they get value from your product as early and frequently as possible. The following list has just a few ways to ensure your team gets it right from square one:
Customer success onboarding doesn’t have to be a rabbit hole of question marks and unmet expectations. While there isn’t a perfect science to the awkwardness that is customer handoffs and onboarding, there can be a clear plan to avoid anyone dropping the figurative baton. The biggest part of finding success is to embrace being an advocate for your new customer. Understand their needs and expectations, celebrate their milestones, and empower them to maximize the full potential of your product for their business goals.
Check out the full list in our white paper, Onboarding your Customers with Purpose, Momentum, and Precision. Download our white paper to learn more about the implications discussed in this blog post.