How to develop and measure a product adoption strategy
User adoption, sometimes called onboarding, is the process by which new users become acclimated to a product or service and decide to keep using it. Users only adopt a product if it helps them achieve a goal of theirs—whether it’s ordering food or launching a business.
Why are user adoption rates critical?
If a company has a high user adoption rate, it’s an indication that far more individuals are adopting the product than are abandoning it. That usually means the company is acquiring new users very efficiently.
Take, for instance, a mobile gaming company that acquires users through online ads. If an increasing percentage of potential users who click the ads love the game and continue playing, the company will make more and more money off of the same initial advertising investment.
Greater efficiency leads to greater growth. Popular measures of user growth such as app stickiness or vitality, for instance, are really just indicators that a company is acquiring users at a faster rate than it is losing them.
Companies with high user adoption rates enjoy:
- Lower cost-per-acquisition (CPA)
- Higher retention
- Higher marketing ROI
- Higher customer lifetime value (CLV)
- Lower customer marketing and retention costs
Any business that benefits from repeat customers is a company that benefits from higher user adoption. For example, high adoption makes:
- SaaS buying committees or decision-makers more likely to renew
- Financial services users more likely to stick with an app
- Consumer tech users more likely to form habits around an app
- Media and entertainment readers more likely to visit the site repeatedly
- Retail and e-commerce shoppers more likely to place repeat purchases
- Telecommunications consumers less likely to churn
To ensure that users find value, stick around, and adopt, companies need to guide them through the process. To do this, companies need a user adoption strategy.
Common user adoption strategies
The goal of a user adoption strategy is to help users reach their goal. That means conducting research to understand users’ motivations, needs, environments, beliefs, complaints, and, most important, all the reasons why users don’t adopt.
Users often churn for reasons teams don’t expect, such as the perception that the product is too expensive, the feeling that it’s too complex, or the impression that a competitor’s product is better suited to their needs.
Teams can think about improving their user adoption rate in terms of this equation:
Adoption = Value / Effort
If the value of the service outweighs the costs, adoption is positive and users are likely to remain customers. If the effort outweighs the value, they abandon it. To improve adoption, the team can either increase the value, decrease the effort, or, ideally, both.
Calculate user adoption rate with this formula:
Adoption = Value / Effort
How to increase the value of the product
Teams can make changes to their marketing or product features to give users more of what they want. Marketing teams can offer discounts, promotions, and freebies that increase the perceived value of the product, such as access to more advanced features.
Product teams can launch new features that make the product more useful. For example, an e-commerce retailer could launch a more powerful recommendations feature powered by a machine learning algorithm, or a streaming video service could allow users to add multiple profiles for different members of their family.
The mere perception of value is value itself. Amazon’s famous Prime membership program offsets it’s allegedly “free” shipping with an annual membership free, but the positive perception around its shipping policy has attracted over 80 million members.
How to reduce adoption friction
One of the biggest barriers to adoption across industries is that users must learn something new. Whether it’s a new workflow, app interface, or dashboard, learning takes mental effort. Users can get fatigued easily, and, following the law of inertia, they tend to stick to services they already know.
To help users adopt something new, teams can lower barriers by adhering to the generally accepted design conventions that users have come to expect, such as navigation menus, transition animations, and progress bars. If the service feels familiar at the outset, it requires less learning.
With product analytics, teams can review the new user onboarding funnel to identify areas where users are running into trouble. Any areas with large drop-offs, or many users exiting the app, may be areas where something is going wrong. When one international peer-to-peer shopping app looked at its new user referral funnel, it found high drop-offs right as users reached a particular landing page. By rewriting the copy, the team doubled the number of successful referrals.
Teams can also conduct first-party customer research via surveys, interviews, journey mapping, and task analyses, where UX researchers study customers using the products as they go about their day.
If the entire adoption sequence seems to frustrate users, consider offering:
- Walkthrough animations
- Onboarding videos
- Onboarding nurture via in-app messages, push notifications, or email
- FAQs and customer help portals
- Surveying users to gauge their satisfaction
Adoption strategies for SaaS software
SaaS software buyers can be a very different beast from consumers. The purchase, implementation, and onboarding of many SaaS software is far more complex than, say, an app that consumers can simply download from iTunes.
Just take a large enterprise that wants to replace its CRM system as an example. To switch to a different CRM requires the team to disrupt the habits of thousands of users throughout the organization, enlist hundreds of hours of the IT organization’s time to implement the new solution, and potentially lose terabytes of information that can’t be transferred. There may be as many as five to seven people within the organization who are involved in the decision, and it could take three to nine months for them to decide and equally long to implement.
As such, it’s important for the vendor to have a deep understanding of the purchase and implementation process for its buyers. Enterprise buyers plan software purchases in terms of:
- All-in-one rollouts: They plan to quit the old service and begin the new
- Parallel implementations: They plan to run both services in parallel as they switch
- Phased implementations: They plan to launch the new service in phases
To help enterprise buyers adopt, SaaS companies must often provide hands-on training, project managers, technical experts, self-help resources, and development resources. However, SaaS buyers are still people, and research is key.
“Nothing matters more than making our customers successful with our product,” says Marketo Director of Retention Marketing Janet Dulsky. “My team spends a lot of time interviewing our customers and digging into data about how they’re using (or not) our platform. We use those insights to drive our decisions about everything from the channel, to the medium, to the content. We are constantly striving to meet our customers’ needs and help them to blaze a successful trail.”
How to measure the success of a user adoption strategy
To manage user adoption success, teams must measure. To measure, follow seven steps:
Pick a goal
First, teams must decide what adoption means to them. For a news site, adoption could mean creating an account, whereas for a dating app, it means messaging a minimum number of matches.
Decide what needs to be changed to meet the goal
Next, teams hypothesize. What’s the gap between users and higher adoption? Is it an issue of not enough value or too much effort? What can they do to about it?
Which metrics prove adoption success? Is it a certain number of visits? Account creation? Successful first payment? Teams may create a new KPI—full adoption—that’s a bundle of metrics that demonstrate adoption.
For tracking metrics, product analytics is key. Most digital products aren’t designed to report on themselves, or correlate user events back to individual users, but product analytics reveals all that, as well as users’ journeys from beginning to end. With product analytics, teams can track:
- User funnels
- User journeys
- Cohorts of users
Develop a tracking plan
Teams must define precisely which events within their platform map back to the metrics they want to track. Teams typically build this out in an Excel spreadsheet that then serves as a map for implementation for the development team.
A tracking plan includes:
- Which events will be tracked
- Syntax and naming conventions for events
- How often events will be tracked
- Timeline for implementation
- A tracking tool
If the product analytics tool has any limitations, it’s important for the team to find out early. For instance, if it can’t resolve duplicate users, or can’t track users across devices.
Capture baseline metrics
Before teams make any changes, they need to take a baseline measurement—a before photo, of sorts, so they can calculate the impact of their user adoption changes.
When ready, teams deploy their marketing campaigns or product feature changes to increase user adoption. If they’re being careful about it, they’ll A/B test these changes one at a time to prove which ones had the greatest impact. If they make multiple changes at once, they may improve adoption rates, but they won’t learn which changes had a positive impact, and, as a result, won’t learn anything about their users or product in the process.
Did the adoption changes have an impact? Are users using the platform for longer, achieving their goals more quickly, and becoming more engaged? If not, keep testing. But if so, keep testing anyway. Acquiring and retaining users is a journey, not a destination, and good teams never stop looking for ways to improve.
Adoption is the ultimate test of a digital product. If busy users decide that the service is worth their money because it helps them solve a problem, they’ll stick with it. Sticky products lead to higher retention, lower acquisition costs, and greater customer lifetime value—all the ingredients for profit and growth. With a user adoption strategy, teams in all industries can capitalize on this knowledge so users’ goals feed into the company’s goals and ensure the product’s long-term success.