In our last post, we talked about the reasons why customers churn. A point that was raised a few times was product adoption (or lack thereof). It’s a point that begs further discussion.
When you look at the majority of factors on why customers churn it boils down to lack of product adoption. However, segmenting churn reasons with a label of ‘low product adoption’ isn’t enough for understanding the drivers of churn. The next immediate question should be ‘why did they not adopt our product?’. You can read a number of possible reasons why on our previous post.
For the purpose of this post, we are going to connect the dots on what product adoption metrics are important to track, measure and have your Customer Success Managers focused on.
In our conversations with clients, as well as in our previous posts, we talk a lot about the importance of Customer Success being proactive and enabling customers along their Required Customer Journey. The core focus of this proactive enablement should be achieving product adoption.
Measuring product adoption isn’t simply ‘do they use our product?’ followed by a yes or no answer. There are important elements that make up healthy product adoption. Beyond asking ‘do customers use our product?’ you should also be asking to what degree and how extensive are they using our product. Product usage should be monitored and measured against set criteria of what successful product adoption looks like for your business. Let’s review the common factors of healthy product adoption:
Depth of Usage
When we look at depth of usage there are a couple of metrics we measure here. How many users are there? Of those, how many users are logging in? We also want to know what departments and business units are using the product. If the nature of the solution is that it can be leveraged and benefit numerous departments and at various levels within the organization, we want to track that and understand if the product is being adopted across the organization.
Breadth of Usage
Understanding how many features are being accessed and used is also critical to know. Are customers using all of the features they have enabled? Are they leveraging them in an effective way? Don’t let high usage in one area of the product let you get your guard down. If a customer is paying for additional access to features they do not use they may ask for a downgrade or leave altogether if they perceive the solution is too expensive in relation to the value they are receiving.
Frequency of Use
You also want to have a firm grasp on how often your product is getting logged into and utilized. If you see it’s logged into infrequently it is a sign that your solution is not integrated into your customers business process. If it’s not mission critical in their day-to-day then your product may slip into ‘nice to have’ territory and not ‘need to have’ territory. Once this happens to may have to re-sell your product in order to avoid churn.
Exposure of Product within the Customers Organization (AKA Executive Level Adoption)
This is a metric that is often missed. If there is only a small set of your customer’s team members that use your product then it’s likely only a small percentage of people inside of your customer’s organization knows its value. You want to ensure your product is adopted by all levels of an organization. For example, if your product is a customer relationship management platform (CRM) then you’d want to see your sales reps logging in every day and adding activities and deal info and you’d also want to see your managers logging in each day to view relevant performance data such as activity info and pipeline data. In addition, you’d also want the senior leadership team to be logging in weekly to look at sales performance and forecasts. Further to that, the desired behavior is to have your marketing department at all levels accessing the platform to view relevant data such as lead conversions.
Now that you know what to measure it’s a matter of how to measure. Determine what ideal product usage looks like for your company. Establish a framework for your Customer Success Managers to follow and create a process for measuring usage and adoption. Have questions on where to get started? Schedule a call with us and learn how we can help.
