Onboarding a new customer is one of the most exciting phases of the customer success journey. You get to teach them how your software works and help them solve key problems they’re experiencing. You’re able to provide value from the minute that users sign up to your products and improve overall retention rates.
However, you won’t be able to improve your onboarding phase if you don’t set out to measure key metrics and KPIs. Metrics and KPIs tell you whether your onboarding has been a success and highlights areas you can change. Optimization and experimentation during the onboarding process helps you provide valuable experiences for your customers.
But many companies are unsure about what metrics to track during the onboarding phase, nor do they understand why onboarding is so critically important.
At its most basic, customer onboarding is the process of familiarizing the customer with your product or service and is most commonly used in software. Onboarding provides an introduction to your product and guides a customer towards initial success and value.
The goal of user onboarding is to make the customer a successful user of your product. They go from not knowing anything about your software to understanding its main features and how it can help them solve problems.
Onboarding teaches your customer that they have chosen the right product, and shows them how it is better than other alternatives on the market. It provides customers with all the necessary learning materials to teach them how to properly use your product.
Proper user onboarding is more than just an introduction to your software. You need to provide thorough training and onboarding materials that relate to your product’s purpose and how it can provide value to the customer.
Why measuring user onboarding success is important
What you don’t measure, you can’t improve. When a customer first logs into your software or downloads your app, it becomes a completely new experience for them. There is nothing but potential and the customer expects to be able to learn how to use your software within a few minutes.
This period is so crucial in the customer journey because it reduces customer churn, it’s essential to measure success in the onboarding process. When customers drop out of using your software, you want to know why and where the problem lies so you can fix it.
Without measurement, you won’t know the main features that customers find value in and which ones you should emphasize. You won’t understand where customers run into roadblocks that stop them being able to successfully use your product.
Onboarding increases the frequency with which customers use your product, and shows them the different ways the product can be useful to them. It gives them an incentive to keep using your product and improves customer retention. You have one chance to convince users that your product is worth it and why they should stay.
Steps to measure user onboarding the right way
1. Understand the user journey
First, you need to map out the user journey that takes place when customers first become familiar with your software. Software that can really help you with this is Churn360, which allows you to monitor how your customers are moving through the lifecycle stages of onboarding, adoption, renewal, and upsell. When your customers are stuck and at risk of churn, you can take proactive action before it is too late.
It’s likely that your customers will take various routes to becoming a proper user of your product. You’ll need to track each stage a customer goes through, from when they first see your app, the process of downloading, the impression they get when they first launch the product, and the journey towards becoming an active user.
2. Find out where customers drop off
The whole point of measuring the onboarding process is to find out where customers stop using your product and drop off from the user journey. These occurrences will impact your metrics and show you where you can make improvements.
For example, in Churn360, you will be able to see where tasks, activities and milestones are being completed along with due dates and reminders and help the Customer Success Managers fight churn. If these tasks are not completed, you can gain insight to where customers are dropping off and take steps to re-engage them.
3. Experiment with different ways to improve onboarding
When you find the areas that need the most improvement you can conduct experiments to see where you can make changes. You can experiment with ways to change the copy that you’re using, the training materials that are presented, or the order in which customers are exposed to different features.
Conduct A/B tests over a period of time to see what changes work best, but be sure not to adjust too many factors at once or you won’t know what has caused the improvements. Analyze which versions result in the best engagement from your customers and have a significant impact on retention.
4. Survey your users
One of the best ways to find out how your onboarding process is working is to simply ask your customers what they think. Churn360 provides customizable surveys that can be distributed through email or in in-app communications. You can capture real-time feedback and insights from your customers that tell you how well your onboarding process is working, through NPS, CSAT, or CES.
Take this feedback and apply it to your onboarding process. Find out what your customers like and dislike, and how much effort it takes them to interact with your software. Satisfied customers are more likely to recommend your software, and to keep using it in the long-term.
8 onboarding metrics and KPIs to track performance
1. Time to value (TTV)
Time to value refers to how long it takes for customers to move from the beginning of the onboarding process to experiencing value with your software for the first time. In order to measure TTV, you’ll have to clearly define what it means for customers to find value in your product. This is based on the reason they have chosen your software and how they hope it will help them. The “aha” moment could be sending their first campaign or running their first report, and will be different for every business.
2. Free trial conversion rate
Free trial conversion rate is the percentage of users who go from being trial users to paying customers in a given time frame. Free trial conversion rate relates to how well you demonstrate the value of your paid offerings during the trial phase.
During this phase, you’ll want to show customers exactly how much your paid product can help them and allow them to use enough features to decide that they want to adopt your solution in the long-term. You can try experimenting with the length of your free trial, or the messaging that you provide in-app to engage customers.
3. Number of support tickets during onboarding
During the onboarding stage your customers will undoubtedly need help with learning how to use your software. While a lot of onboarding should be automated by providing self-service materials, customers will sometimes submit support tickets.
You can use these support tickets to understand where customers typically need help during onboarding and apply them to improving the onboarding experience. Your goal is to reduce the number of support tickets that are submitted by your customers and make the onboarding experience more intuitive.
4. Customer retention rate
Customer retention rate is the number of customers your software is able to hold on to over a particular timeframe. Onboarding is an important way that your business has to retain more customers because it activates more users with your product. When users understand how to get started with your product, they are more likely to keep using it in the long-term, so retention rate is a valuable measurement of your onboarding success.
Calculate your retention rate by dividing the number of new users by the number of those users who haven’t churned after one day, week, month, and so on. Focus on reducing your retention rate during the first weeks and months of acquisition, because this will give you insight into onboarding.
5. Customer engagement
One of the primary goals of onboarding is to have customers actively engaging with your software over a period of time, meaning they have found success with your product and consider it useful. Being engaged with your software means regularly logging in and using the features of your software, and as a result your users are less likely to churn.
Tracking this metric means dividing your users into groups that are defined based on when the customer first started onboarding. You can follow whether these users are using your product on a daily, weekly or monthly basis depending on what you define as “engaged”.
6. Net Promoter Score
Net Promoter Score helps you measure whether the user would recommend your product or service to a friend. By sending out an NPS survey during the onboarding phase, you can find out whether customers are satisfied with your product and are gaining value from it. By directly asking customers how they feel, you’ll be able to gain critical insight into the success of the onboarding process.
NPS surveys group customers into Detractors, Passives and Promoters depending on how they answer your survey based on a ten-point scale. Detractors wouldn’t recommend your business, Passives are neutral about your business, and Promoters would actively advocate for your business to others.
7. Customer churn
Monitoring customer churn is a good way to measure the success of your onboarding process because it keeps track of how many customers stop using your product or service. When customers benefit from effective onboarding, they are much less likely to churn because they understand how your software can benefit them and how to use it.
Customers are always assessing whether they should keep paying for your software based on whether it is useful to them and value for money. You can decrease churn by showing customers the full potential of your product through regular engagement emails, customer success calls, and self-service content.
8. Completion rate
Completion rate is the percentage of users who actually complete your onboarding process. The reason this metric is important is that if users don’t complete your onboarding they aren’t likely to convert to paying customers. You need to keep track of the points at which customers are most likely to abandon your software and fix the problems that customers are encountering.
It’s critical to remove obstacles that might be encountered by customers who are trying to complete your onboarding process. A low completion rate might indicate that your newly acquired customers are a bad product fit and have a very limited potential for finding success with your software.
By keeping track of these key onboarding metrics and KPIs, you’ll be able to improve the customer onboarding process and ensure that more users become successful with your software. If you don’t strive to gain the right insight into your customers’ behavior and likelihood of churn, your customer lifetime value will suffer as you’ll lose those customers you spent so much effort to acquire.
Measuring onboarding metrics means you’ll be able to adjust your onboarding process to make it the best it can be, and improve the chance that customers will find value in your software. An optimized onboarding process means that customers will be assured they made the right decision in choosing your solution over your competitors, and be inclined to stick with it in the long-term.