Measuring Customer Activation for B2B SaaS

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I’ve heard some refer to customer activation as the moment when your customer gets value from your product, but I look at this stage a bit differently. Value comes later, in the Retention stage, activation is the moment when your customer completes the bare minimum required to begin experiencing your product.

Why is Activation important to SaaS businesses?

Customer Activation is the moment when your customer completes the bare minimum required to use your product. If you have a high number of users signing up for your product and never completing activation, you have a problem. It could be that you’re attracting the wrong people. It could be that your setup flow is too complicated or confusing, it could be that you have a bug in your product, it could be anything … the point here is that you need to define activation and be proactive about getting your users to this milestone as efficiently as possible.

How do I define activation for your SaaS service?

This is going to be different for every SaaS product. Basically, you need to understand what steps your users are required to complete before they can actually use your product. It could be as simple as completing the account creation, or it could be a 10 step process involving defining custom properties, setting up and inviting team members, and completing custom integrations.
You need to understand Product Activation, in order to drive growth for your SaaS business.

How do I track Customer Activation?

This is the easy part. Once you clearly define the moment your users achieve customer activation, simply fire off a tracking event using google tag manager, segment, or mixpanel.

Once I am tracking Customer Activation what do I do with the data?

Well, there are a number of things you can do with this data. Below are some metrics that can help you understand customer activation and how important it is to your business.

Customer Activation Metrics:

  • Total Activated Users (count of activated users for a given period)
  • % Activated Users (of all the users that signed up in a given period, what percent of them activated). This represents your opportunity. Users that do not activate are dead.
  • Avg. Time to Activation (how long does it take for users to reach activation). In order to calculate this metric, you’ll need to fire an event at signup, and both this event and the activation event will need to include a timestamp.

This should give you a great start on understanding customer activation and why it is such an important SaaS metric.

Related Article: The SaaSPLG Funnel: Acquisition

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