Which Metrics Measure Activation in SaaS?
In SaaS businesses, the ultimate measure of activation would be conversion rate from a visitor to a paying customer. However, user engagement with the product's key features and functionalities can be leading indicators for this activation.
The following metrics provide insights into how users are adopting and deriving value from the software.
Key Activation Metrics in SaaS:
- ☞ User Engagement with Core Features: This metric assesses how often and how deeply users interact with the primary functionalities of the software. It’s indicative of the users finding real value in the product.
- ☞ Frequency of Use: Regular usage of the software suggests that users rely on it for their tasks or business operations, signifying effective activation.
- ☞ Progression through the Onboarding Process: Analyzing how users progress through initial setup and onboarding can reveal how quickly they are getting up to speed with the software's features.
Tying Metrics to the 'Aha Moment':
One of these metrics should ideally lead to, or correlate with, the user's 'Aha Moment'—the point at which they fully grasp and appreciate the value of the software.
This can be qualitatively verified through customer surveys and interviews, as well as quantitatively through correlation with converting to a paying customer and/or long-term retention as a customer.