Imagine launching a shiny new SaaS tool, only to watch as user adoption flatlines. You're not alone. This scenario is all too familiar for SaaS providers. In fact, research suggests that around 80% of new SaaS product features go unused, and abandoned products have an even bleaker future. So what's the secret to boosting SaaS product adoption? Start with a solid onboarding plan that helps new users understand the value of your product. And a great way to get users through the onboarding process is with product demo videos. In this blog, we'll explore why SaaS product adoption matters, how to boost it, and the role demo videos can play in your success.
Moonb can help you create the product demo videos to accelerate your SaaS product adoption. Our team of writers, designers, and video producers will craft a clear, engaging video that will excite your users about your product and how it can solve their problems.
Product adoption is how customers familiarize themselves with a product and determine how it can help them achieve their goals. Product adoption differs from activation, which is a single event where a user hits a milestone in your product and experiences value that shows them your tool will be worth their time. User adoption happens when the user completely embraces your product as the customary solution to the specific problem they're solving.
If you ever find yourself reading about product adoption and see the terms user adoption and customer adoption, you should know there are subtle differences between the two. In SaaS jargon, user adoption focuses on the individual users, while customer adoption refers to the adoption at the account level. Drilling this down even more, user adoption refers to individual users. In contrast, customer adoption refers to adoption at the account level something that multiple users may share (each with unique needs).
The first big-picture way to understand the product adoption process is with the product adoption curve. The curve shows the rates at which different customer categories tend to adopt a product at different stages of its customer lifecycle. There are five different stages, and each stage has customer segments of different sizes and characteristics.
The first users that are ready to adopt a product are the innovators. This group of users only makes up 2.5% of the market. Innovators usually consist of tech enthusiasts open to trying new things and keen to explore the latest technological advancements. That’s why these types of users are an excellent source of feedback and suggestions on the evolution of your idea. They can also help you discover any potential problems or missing features. That said, typically, they are more interested in checking out something new rather than committing to a product for the long run.
Meanwhile, early adopters usually have more of a need for your product and a budget for a solution. Essentially, they’re trendsetters, thought leaders, and visionaries looking to find the innovative solution to their biggest pain points. To capture early adopters, you’ll need to focus on fixing bugs with your product. On top of this, these users will expect amazing customer support for any issues.
Next up on deck, we have the early majority. And while this may sound similar to early adopters, there is a key difference between these user groups. With the early majority, we’re making our way to the cautious portion of the market. They want to use your product, but they’re only interested once it has been established and earned a strong reputation. Getting to this group of users isn’t an easy task. Because these users are more risk-wary than the previous two user segments, there’s often a gap between the second and third groups.
So, how can you overcome this gap? It’s all about creating a sense of assurance by developing a strong relationship with the innovators and early adopters. While building this foundation may be time-consuming, the early majority wants to find a long-term solution. So, there’s a good chance they could become loyal product adapters once they pull the trigger.
This next segment of product users has some overlap with the early majority. So, what’s the major differentiator? They are even more risk-averse and very intolerant of bugs or other technical issues. This means that the late majority will only become product adopters once they feel secure in their decision.
Some of the best ways to do this are through genuine testimonials and reviews. Where do you get those? In the first phases, innovators and early adopters will often leave feedback and insights on what they think and have experienced using your service. Document those journeys and experiences for use during this pragmatism-filled stage.
Oh, the laggards. This is the most challenging group of users regarding product adoption. They can be skeptics, technology-averse, resistant to change, or unaware of your product. And often, they are more comfortable with what they know. This means that to get laggards to adopt your product, you’ll need to make it feel like it’s necessary for them.
The stages of product adoption describe how customers become aware of, evaluate, and ultimately decide to use a product. Understanding these stages is crucial for businesses aiming to enhance user engagement and drive successful product adoption.
In this initial stage, potential customers become aware of the product's existence. This awareness can be generated through various marketing efforts, including:
The goal is to inform potential users about the product and its benefits, effectively capturing their attention.
Once aware of the product, customers enter the research phase where they seek more information. They explore how:
This stage often involves:
At this stage, potential customers evaluate the product against their needs and compare it with competitors. They assess factors such as:
Businesses should differentiate their product during this phase to persuade customers to choose their offering over alternatives.
The trial stage allows customers to test the product in a limited capacity. This could involve a free trial period or a demo version where users can experience the product firsthand. This is a critical phase where users assess whether the product meets their expectations and provides sufficient value to justify continued use.
In some models, this stage is included after trial as users begin to realize the product's value through key actions or milestones (e.g., completing a setup process or using a core feature). Activation signifies that users have moved beyond initial skepticism and are starting to integrate the product into their workflows.
The final stage is when users fully embrace and incorporate the product into their daily routines or business processes. Successful adoption leads to regular usage and can result in long-term customer loyalty. However, businesses must continue to provide support and gather feedback even after this stage to ensure ongoing satisfaction.
One of the primary benefits of SaaS product adoption is the consequential improvement in user satisfaction. Successful adoption translates to:
As users gain confidence and familiarity with the platform, their overall experience is heightened, fostering a positive relationship beyond mere satisfaction to brand loyalty. A well-adopted SaaS product often results in a user base that appreciates the functionalities offered and feels a sense of empowerment in utilizing the software to its full potential. This enhanced user satisfaction becomes a cornerstone of success, as satisfied users are more likely to continue their:
Efficiency and productivity are key drivers for any business, and SaaS product adoption plays a pivotal role in achieving these goals. As users become adept at leveraging the features and tools offered by the software, workflows are streamlined, and redundant tasks are automated, leading to a significant boost in overall productivity.
Optimized SaaS adoption empowers users to work smarter, not harder. These aspects become integral components of daily operations:
The cumulative effect is a workforce that accomplishes tasks more swiftly and effectively, maximizing the output of individual contributors and, consequently, the entire organization.
Collaboration is the backbone of modern workplaces, and SaaS products often facilitate seamless teamwork. Successful product adoption ensures that users embrace individual features and harness the collaborative potential embedded within the software.
Many SaaS solutions are designed with a focus on enhancing communication and collaboration among team members, irrespective of geographical location. By fostering a connected and collaborative work environment, businesses can:
Optimized SaaS product adoption enhances operational efficiency and often translates to tangible cost savings for organizations. As users become proficient with the software, manual efforts are reduced, and processes are streamlined, leading to a more efficient utilization of resources.
The cost-effectiveness of well-adopted SaaS products is two-fold.
SaaS products, especially those in the analytics and business intelligence domains, empower organizations to make informed, data-driven decisions. Successful adoption ensures that users understand the basic functionalities and harness the full potential of analytics tools embedded within the software.
By providing real-time insights and analytics, SaaS products enable businesses to:
This data-driven approach becomes a competitive advantage, allowing organizations to stay agile and responsive in an ever-changing business environment.
SaaS products are renowned for their scalability and flexibility, and successful adoption ensures that organizations can fully capitalize on these advantages. Whether a business is experiencing growth or adapting to changing market conditions, a well-adopted SaaS solution allows for seamless scalability without compromising efficiency.
The flexibility of SaaS products also ensures that organizations can adapt their software usage to match evolving business requirements. This adaptability becomes crucial in dynamic industries, where the ability to pivot and embrace change is synonymous with long-term success.
In an era where data security and regulatory compliance are paramount, successful SaaS product adoption goes beyond features and functionalities to encompass robust security measures. A well-adopted SaaS solution ensures that users are aware of security best practices and actively incorporate them into their daily usage.
SaaS products often come equipped with security features and compliance protocols, and effective adoption ensures that users leverage these tools to mitigate risks effectively. This proactive approach to security not only protects sensitive data but also instills confidence among users, fostering trust in the reliability and integrity of the software.
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Did you know that 88% of online users are less likely to return after a bad user experience? This staggering number indicates the importance of creating an exceptional experience for your customers in the initial stages of their journey. If your customer’s initial interaction is positive, it can build a positive impression, establish trust, and set the stage for continued product adoption.
So, here’s how you can ensure that your first-time users have a positive experience:
This image shows the in-app tooltips on Slack, which guide users through the platform's different features. For example, when you create a new account on Slack, the tooltips guide you through its different features, highlighting the functionality of each one.
One of the fundamental and crucial steps in any business endeavor is understanding your customers. This knowledge enables you to identify their needs, preferences, and pain points, allowing you to develop and offer products tailored to their specific requirements.
Here’s how you can do it effectively to improve product adoption.
The image shows the customer journey mapping of Amplitude Analytics. Here the customer journey is tracked from initial sign-up to purchasing. Define and track the specific goals and objectives that your users want to achieve with your product. Analyze whether they are successfully reaching those milestones. By implementing these strategies, you can develop:
This will boost your product adoption.
According to ThinkWithGoogle, 63% of smartphone users are more likely to purchase from companies whose websites or apps offer them relevant recommendations on products they may be interested in. 63% is a big number, right? It highlights the importance of creating personalized experiences for your customers. This is essential for improving product adoption because it acknowledges that not all users are the same and that their needs and preferences vary.
This allows product owners and managers to create a product that addresses the pain points of different customers. Here’s how you can create personalized experiences:
By focusing on personalized experiences, you can enhance:
Users are likelier to stick with and fully adopt a product that caters to their unique needs and provides a seamless and tailored experience.
Do you know that friction during onboarding can result in as much as 75% of customers opting for another provider? This staggering number highlights the importance of creating a seamless and engaging onboarding process for first-time users.
Here’s how you can do that.
Tip: Use customer feedback in onboarding surveys to optimize your process further! By implementing personalized, short, and value-focused onboarding processes that incorporate various learning resources, you can enhance the user experience and improve product adoption.
Let’s say you have a fitness app. You have now upgraded your user interface design and want your users to update the app to experience the new changes. How to notify them without disrupting their interaction with my app?
Here’s how:
By focusing on these personalized strategies, you can cater to the unique needs and preferences of both decision-makers and product users, making it more likely that they will adopt your product effectively and find value in it.
Let’s say you have launched a new feature in my beauty app that enables users to filter beauty products by brands. But not many users are using it. It can be because the navigation is complex or the feature is hard to find. Now with thousands of users, how will I be able to find and fix the issue?
Here’s how I can do it:
Incentivizing your users during the product adoption journey can be a crucial step in attracting and retaining customers.
Here’s how you can do it:
Customer support is the cornerstone of creating an exceptional customer experience for any business. It’s the most basic thing customers expect from any business they deal with. According to a survey by Forrester, 41% of customers expect a response to a customer support email within 6 hours but only 36% of the businesses can respond within the timeframe. This shows that selling products is not enough, you have to be there for your customers at every step of the way. This will ensure your customers feel valued and heard and find value in your product.
So, here’s how you can ensure that your customer support is top-notch:
Setting up SaaS KPIs to measure and improve product adoption is crucial for assessing your product's success and understanding how well it is being embraced by your target audience.
Here are three important KPIs to track:
Regularly track and analyze these metrics to make data-driven decisions, refine my product adoption strategies, and ultimately enhance the success of my product in the market.
The SaaS product you create should aim at solving users’ pain points and hence become irreplaceable for them. Making your product irreplaceable is also required for sustainable growth and customer retention.
Here are key strategies to achieve this:
Focusing on these strategies can make your SaaS product an indispensable part of your customers’ operations, increase user retention, and build a loyal customer base.
Going one step beyond regular updates is an excellent approach to retaining your SaaS customers and turning them into enthusiastic advocates for your product.
Here are some strategies to take your updates to the next level:
This taps into users’ psychological motivations for competition and achievement, making the product more engaging.
Testing new in-app messages and guides is a great way to catch users’ attention and keep them engaged. Switching up my user adoption strategy to align with changing needs, new updates, or just trying something new can prevent my onboarding or education material from growing stale and outdated.
Here are some ways to use in-app messages and guides that I may not have already considered:
Get creative with how I add in-app messages or guidance. Look for new, personalized ways to connect with users and include visuals or interactive content that will help keep them engaged.
The product adoption rate tracks how many customers actively use your product, as opposed to just activating or downloading it once. It shows how many people become regular users of your product to help them achieve their goals.
You can measure product adoption:
To calculate the product adoption rate, divide the number of new active users by the number of signups and multiply it by 100. Simply put,
Product adoption rate = (New active users / Signups) * 100
For example, if your total number of users is 400 and the number of new users in a month is 40, your product adoption rate is (40/400)*100 = 10%.
Let’s look at some stats to compare your product adoption rate to other SaaS solutions.
The ideal product adoption rate will differ from one product to another, but you can use the above benchmarks for evaluation. In general, the higher your adoption rate, the better. More people using your SaaS means they can see the value of your product and are likely to renew their subscription.
Time to Value (TTV) measures how long customers can get value from your product. This metric tracks explicitly the time it takes for a user to get value after product onboarding. The faster your customers reach this point, the better. High TTV rates point to poor product adoption, which can lead to customer churn.
Tracking TTV will help you identify potential friction points in the onboarding process. You can then remove these obstacles to help your customers onboard faster and reach the activation point, so they can start realizing the benefits of your product.
Customer lifetime value (CLV) is the total revenue you can earn from a single customer throughout their relationship with your business. Improving product adoption increases CLV because it helps customers get the hang of your product quicker so they can start realizing its benefits. The longer they use your product, the more revenue you’ll generate from them.
The product activation rate measures how many users reach the activation point after signing up for your product. To calculate this metric:
Average session duration is the average time a user spends engaging with your product. It measures the level of user engagement and how long it takes for a user to get value from one visit. Average session duration is a key indicator for TTV, helping you determine if you need to adjust the onboarding processes.
It can serve as an early warning sign for potential churn, as shorter session durations may suggest users are spending less time engaged with the product.
The product stickiness rate is one of the key product metrics you should measure to know whether your product creates value. Users tend to keep returning to your product because it’s engaging and valuable to them. Stickiness equals the ratio of daily active users (DAUs) to monthly active users (MAUs).
For example, if you have 2,500 daily active users and 5,000 monthly active users, your stickiness rate is 0.5 or 50%. Product stickiness drives growth by improving customer retention, providing account expansion opportunities, and increasing customer lifetime value.
To adopt your product, customers need to find your product’s features useful. This is where the feature adoption rate comes in. Some relevant features may not be hidden, but customers can still find it difficult to notice where they are. This is why feature discovery helps improve your feature adoption, especially with a new feature. To calculate the feature adoption rates, divide the number of monthly active users of a feature by the number of users who logged in within a specific period and multiply the result by 100.
Along with other advanced feature adoption metrics and analytics, this metric can help you develop a successful strategy to drive feature adoption. You can also create onboarding experiences to guide users to new or more advanced features.
If your target users don’t engage with your product enough, they won’t find it helpful to their cause. Therefore, customer engagement provides vital insights into the ‘health’ of your customers. The user engagement score allows you to discover disengaged customers on the verge of churning and even find opportunities for product expansion.
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