The Ultimate Guide to Product Adoption: All You Need to Know

Success in the B2B & SaaS industry equals the number of people finding your product useful!

Merely focusing on gaining customers won’t work. You need to make users keep using your product without needing a better alternative. 

This is why you need to develop your product adoption strategy such that users find your product as the best solution to their problem that is worth their time & money.

To help you master the art of product adoption, we have come up with this detailed guide that talks all about:

• Product adoption & its importance
• Process to measure product adoption
• Stages in product adoption
• Ways & tools to boost product adoption

Let’s take the first step towards SaaS success!🚀

What is Product Adoption?

Product adoption is the process in which users become aware of a product, understand its value, and begin to use it. 

It is the process of getting people to use your product and not just getting them to sign up without ever using it for real. You need to offer something to your prospects that will turn them into long-term loyal users of your product. 

For example, Slack was able to achieve product adoption by offering a communication and collaboration tool that was more efficient and user-friendly than email. They also made it easy for teams to sign up and start using the product, leading to a better adoption rate.

Another great example is Uber, which was able to achieve rapid product adoption by offering a convenient and affordable way to get around. 

Why is Product Adoption Important?

In the SaaS industry, it’s easier than ever for customers to switch subscriptions as there are plenty of options available for each type of product. This means you have to work harder to retain customers, making product adoption essential. 

And when you achieve a good product adoption it results in plenty of benefits:

• Improved customer experience and loyalty
• Better customer lifecycle value
• Increased feature use and repeat purchase
• Genuine recommendations from existing customers 
• Increased revenue growth
• It takes less effort and resources to retain existing customers than to acquire new ones

Product adoption is also important for companies to improve their products and services. By tracking how users interact with their products, and listening to their feedback you can identify areas where the products can be improved.

How to Measure Product Adoption?

There are several metrics that you should track in order to gauge product adoption. But it is not as simple as it sounds. You need to first identify which metrics align with your objectives, and then refine based on the data that makes the most sense for your product type.

So to be able to measure your product’s adoption rate properly, you must figure out certain things first.

1. Define your objective: What do you want to measure? Are you interested in tracking the number of new users, the number of active users, or the number of users who are using specific features? Once you know what you want to measure, you can choose the right metrics to track.

2. Track usage of features: One way to measure product adoption is to track the usage of features. This can be done by tracking the number of times a feature is used, the amount of time users spend using the feature, or the percentage of users who use the feature.

For example, a new social media app could track the number of videos created and shared each day, the amount of time users spend watching videos, or the percentage of users who create and share at least one video per week.

3. Identify which metrics to track: Not all product adoption metrics are created equal. The metrics that are most important to track will vary depending on the specific product and the company’s goals.

For example, A SaaS product that is sold to businesses may want to track metrics such as the number of active users, the number of users who are using key features, and the time to value. A mobile game may want to track metrics such as the number of daily active users, the average session length, and the number of in-app purchases.

4. Start tracking & analyzing: Upon deciding on the key metrics that matter to you, use proper tools to track them, and analyze the data, usage pattern, customer behavior, etc to conclude how well people are embracing your product and the areas that are lacking and needs to be taken care of. 

Top Product Adoption Metrics

Here are the top 5 product adoption metrics used by most businesses. 

1. Adoption Rate

The adoption rate measures the proportion of users or customers who have actively embraced a new product or feature within a specified time frame. It provides a clear indication of how well the new offering is being received.

A high adoption rate signifies successful product launches and user engagement. It demonstrates that your product resonates with your audience and that your marketing and onboarding efforts are effective. 

Monitoring adoption rates helps in optimizing marketing strategies and improving user experience, ultimately leading to business growth.

2. Time-to-Value (TTV)

Time-to-Value (TTV) represents the duration it takes for users to realize the benefits and value of your product after the initial interaction or sign-up. It reflects the efficiency of your onboarding process and how quickly users can start utilizing your product effectively.

A shorter TTV is crucial because it ensures that users experience the product’s value promptly, reducing the likelihood of abandonment. 

It highlights the effectiveness of your user onboarding process, allowing businesses to identify bottlenecks and streamline the user journey. Swift TTV enhances user satisfaction and encourages long-term product usage.

3. Product Activation Rate

Product Activation Rate measures the percentage of users who complete specific actions or achieve predefined milestones that indicate full activation of the product’s features. These actions typically include setting up an account, completing a profile, or using key features.

A high activation rate indicates that users are actively engaging with your product’s essential features. It signifies successful onboarding and initial user interaction. Understanding which actions lead to activation helps in designing targeted onboarding campaigns. 

By increasing the activation rate, businesses can improve user retention, as users who are fully engaged with the product are more likely to continue using it.

4. Customer Lifetime Value (CLV)

Customer Lifetime Value (CLV) represents the total revenue a business can expect to earn from a customer throughout their entire relationship with the company. It is a broad metric that accounts for many factors, one of which is product adoption.

CLV is a crucial metric for long-term business sustainability. It helps businesses identify high-value customers, allowing for personalized marketing strategies. 

By maximizing CLV, companies can focus on retaining profitable customers, offer loyalty programs, and enhance customer satisfaction. Increasing CLV directly contributes to higher revenue and profitability.

5. Churn Rate

The churn rate measures the percentage of customers who discontinue using a product or service within a specific period. A high churn rate indicates that a significant number of customers are leaving, which can negatively impact revenue and growth.

The churn rate is vital for assessing customer retention. High churn rates can be detrimental to a business, leading to revenue loss and increased acquisition costs to replace lost customers. 

By understanding the reasons behind churn, businesses can implement retention strategies, improve customer support, and enhance product offerings, ultimately reducing churn and ensuring long-term customer relationships.

Stages of Product Adoption

1. Awareness

The awareness stage is the first stage in the product adoption process. It is when a potential user becomes aware of a product for the first time. This can happen through a variety of channels, such as marketing campaigns, word-of-mouth, or social media.

2. Interest

Once a potential user is aware of a product, they may become interested in learning more about it. This is where they will start to gather information about the product, such as its features, benefits, and pricing. They may also read reviews from other users or watch videos about the product.

3. Evaluation

In the evaluation stage, the potential user will weigh the pros and cons of the product to decide whether to adopt it or not. They will consider their own needs and requirements, as well as the cost of the product.

4. Trial

If the potential user decides to evaluate the product further, they may try it out for free or for a discounted price. This is a great opportunity for the product owner to show the potential users the value of the product and to convince them to adopt it.

5. Adoption/Rejection

If the potential user is satisfied with the product during the trial period, they will adopt it. This means that they will start using the product regularly. However, if the potential user is not satisfied with the product, they will reject it.

Here is a short example of how a user might progress through the stages of product adoption:

1. Awareness: A user sees an advertisement for a new social media app.
2. Interest:  The user visits the app’s website to learn more about it.
3. Evaluation: The user reads reviews from other users and decides to try the app.
4. Trial: The user creates an account and starts using the app.
5. Adoption: The user enjoys using the app and continues to use it regularly.

It is important to note that users can move back and forth between the stages of product adoption. For example, a user who has adopted a product may reject it if they are not satisfied with it. Additionally, users may skip some stages altogether. For example, a user who is already familiar with a product may skip the awareness and interest stages and go directly to the evaluation stage.

Product owners can use their understanding of the stages of product adoption to develop strategies to attract and retain users. 

The Role of Reviews in Product Adoption

Reviews, testimonials, and word-of-mouth play a crucial role in today’s customer journey. SaaS product adoption is no different.

In the awareness stage, a recommendation might be the first way to learn about a new solution. When you colleague speaks about a new solution that helped them solve an important problem, you are surely intrigued.

In the interest stage, reviews on your website help instill trust.

During the evaluation stage, reviews on different platforms and review sites are central to the customer’s research.

The trial phase shows if you can deliver the experience that the reviews convey. At this stage, companies that fake their reviews are in big trouble, as they are not able to meet expectations.

Finally, when the user has adopted a product and enjoys using it, they are likely to give reviews and continue the positive cycle!

If you want to dig deeper into the topic, read our article on why reviews matter for SaaS companies.

5  Ways to Improve Product Adoption

1. Get Feedback from Customers

Getting feedback from customers is essential for understanding their needs and how they are using your product. This feedback can help you identify areas where you can improve your product and make it more user-friendly.

Trustmary’s Survey Maker is a great tool for collecting feedback from customers. It allows you to create custom surveys that you can send to your customers via email or embed on your website. Trustmary also provides a variety of features to help you analyze your survey results, such as sentiment analysis and real-time reporting.

On top of customer feedback, you can collect powerful customer reviews that help you build trust with new potential customers.

G2 and Capterra are two popular review sites where customers share their experiences with different software products. Getting positive reviews on these sites can help to improve your product’s adoption rate.

2. Keep Improving Your Product from Feedback

Once you have collected feedback from customers, you need to use it to improve your product. This means prioritizing the most important features and bug fixes that customers have requested.

You should also keep an eye on your customer satisfaction metrics. If you see that a particular metric is declining, it is a sign that you need to improve your product in that area.

3. Provide Support to Customers When They Needed

Another important way to improve product adoption is to provide excellent customer support. Customers like to be heard and get help when they need it.

You can provide customer support through a variety of channels, such as phone, email, live chat, and social media. You can also have a knowledge base where customers can find answers to common questions.

4. Improve User Onboarding Process

The user onboarding process is the first experience that a customer has with your product. It is important to make this process as smooth and easy as possible.

One way to improve the user onboarding process is to create a user onboarding guide. This guide should walk new users through the basics of your product and show them how to use its most important features.

You can also use in-app messaging to guide new users through the onboarding process. In-app messages are pop-ups or notifications that appear within your product. You can use in-app messages to highlight key features and provide instructions to new users.

5. Analyze Your Churns

Churn is the percentage of customers who stop using your product in a given period. It is important to track your churn rate and identify the reasons why customers are leaving.

You can use a variety of tools to track your churn rate and analyze customer churn data. Some popular tools include Customerly, ChurnZero, and Amplitude.

By analyzing your churn data, you can identify areas where you can improve your product and reduce customer churn.

Types of Software You Need to Increase Product Adoption

1. Marketing Automation Software

Marketing Automation Software streamlines marketing efforts by automating repetitive tasks such as email marketing, lead nurturing, and social media posting. The automation ensures timely, personalized communication, nurturing leads efficiently. This targeted engagement fosters brand awareness and loyalty, driving higher product adoption rates.

Examples:

• HubSpot
• Marketo
• Pardot

2. Product-led Growth Platforms

These platforms offer frictionless onboarding, interactive tutorials, and free trials, allowing users to experience the product’s value firsthand. By emphasizing user experience and value during initial interactions, they significantly enhance product adoption and user retention.

Examples:

• Pendo
• Appcues
• Userpilot

3. Feedback & Survey Tools

Gathering customer insights through feedback tools helps businesses understand user needs and preferences. By acting on this data, companies can enhance their products, resolve pain points, and tailor offerings, directly influencing customer satisfaction and increasing product adoption.

Examples:

• Trustmary
• SurveyMonkey
• Qualtrics

4. Customer Experience Management Tools

Customer experience management software helps businesses to track and measure customer satisfaction. These tools collect and analyze customer feedback, allowing businesses to map customer journeys and pinpoint pain points. By addressing these issues and enhancing overall satisfaction, customer experience management tools create a positive environment, driving loyalty and product adoption.

Examples:

• Qualaroo
• Freshdesk
• Zendesk

5. Knowledge Base Software

Knowledge bases empower users to find answers independently. Offering a repository of helpful resources and FAQs, reduces user frustration, enabling swift issue resolution. This easy access to information boosts user confidence and drives higher product adoption rates.

Examples:

• Document360
• Help Scout
• KnowledgeOwl

6. A/B Testing Platforms

A/B testing refines user interfaces and content based on real-time user feedback. By identifying optimal designs and messaging, businesses can create a more engaging user experience, increasing user satisfaction and product adoption through data-driven enhancements.

Examples:

• Optimizely
• Google Optimize
• VWO

Final Piece of Advice For Better Product Adoption

Recognizing that each product is unique, it’s crucial to tailor your approach based on specific objectives and user behaviors.

Understanding your target audience, what’s working, and listening to your users for what can be improved to provide a better user experience, can make a big difference. Hence, our final advice is to make feedback surveys an integral part of your process. Listen to what your users want and try to provide end-to-end solutions to their problems. 

That’s all. Now it’s your turn to gear up your strategies and tools with the mentioned best practices and ways to enhance your product’s adoption rate!

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Written in collaboration with Make SaaS Better team.