What makes a product truly successful? Is it an affordable price or a flashy feature set? Surprisingly, it’s neither – a successful product is one that activates the customer as soon as possible. Simply put, customer activation is the first time a user gets value from your product or service. It's about guiding users through every step of their journey so they engage with your product regularly and become loyal customer.
Defining Customer Activation
Customer activation can look different depending on the type of company. For a productivity app, it's when a user makes their first to-do list. In a marketing tool, it's when a customer launches an email or SMS campaign. In eCommerce, it's when a customer completes checkout or makes a repeat purchase, and so on.
Activation isn't just for new customers; it also helps engage existing ones who:
- Don't use your product much,
- Haven't explored advanced features or
- Haven't returned after their first purchase. Customer activation is generally a three-step process: understanding the user experience, defining the "golden path," and setting activation metrics and KPIs.
Understanding the User Experience
There's one thing all customers are looking for: the easiest way to use your solution. The simpler it is to engage with your website or product, the more likely they will get further into the user journey.
Here, the key step is to understand and analyze the user experience – ask questions like:
- Where do your customers typically drop off?
- Do they sign up and choose not to subscribe?
- Do they churn right after their free trial?
- Do they abandon their carts in the checkout section?
The answers will help you address roadblocks, prevent churn, and prepare a customer activation plan. This is even more crucial when you roll out new features. Change always creates friction, and it's your job to make sure your users can getvalue from the feature right away.
The Golden Path in the User Journey
There are multiple journeys a user can take to get to the most important feature of an app.
The golden path, or the Key User Journey, is the simplest set of steps a user can take to derive value from the product. It should be the default path, taking the user from A to B with no pit stops along the way. Plus, it should be simple enough that there’s no room for users to make an error.
You might find other paths that also work, but the Golden Path is the main flow of the user journey. Any secondary flows, like making an account or changing your address, don't need to be included in the Golden Path.
Setting Clear Metrics and KPIs
Once you've defined what customer activation means for your business, how do you know whether your strategies are successful? It's simple: setting clear metrics and KPIs. You'll need to track quantitative and qualitative data, such as:
- Activation Rate: What percent of new signups complete key actions like using your product for the first time?
- Time to Activate: How much time does it take for users to start using your product or engaging with your content after signing up?
- Daily/Weekly/Monthly Active Users (DAU/WAU/MAU): How many customers actively using your product daily, weekly, and monthly? This will help gauge how many customers use your product regularly.
- Activation Frequency: How frequently do customers use your service, and does it align with your product objectives? For instance, a customer logging in just once a month may not yield enough value.
- Churn Rate: What percent of customers unsubscribe from your service? How many of these unsubscribed customers were inactive?
- Customer Feedback: What feedback are customers providing? This offers insights into their pain points and frustrations that get in the way of their engagement.
The Importance of Customer Activation for Your Business
Most brands are completely focused on customer acquisition, but it's the activation phase that determines the health of the customer-business relationship. A successfully activated customer means a successful conversion, as well as a relationship with a loyal and engaged user.
So, what is the importance of customer activation for your business? Let's look at a few benefits.
Impact on Revenue Generation
When customers are activated and converted, they're not just passively browsing your service anymore – they're actively engaging with your brand. They may check product features, join discussions, or even give feedback.
Of course, the higher the conversion rate, the better your revenue generation will be. In fact, you can find your ROI from the conversion rate with this formula:
Reduction in Customer Acquisition Costs
Customer activation means getting users to trust and see the value in your product or service from the get-go. When they derive value right away, customers are much more likely to stay with you longer, leading to better retention rates.
That means you'll be spending less on customer acquisition – it costs 5 to 7 times more to acquire a new customer than to keep an existing one.
Increase in Customer Lifetime Value
Engaged and activated users are more likely to buy from your brand repeatedly. They also interact with the brand at different levels over time. This ongoing, strengthened relationship boosts the overall value they bring to the business throughout their lifecycle.
In simple words, it translates into recurring revenue streams and higher CLV over time.
Fostering Customer Loyalty
Creating a smooth and enjoyable customer activation process also gives you an edge in building customer loyalty. When customers have a great experience with your product on the get-go, they're a lot more likely to stick around. This leads to happier customers who return for more and tell others about their positive experiences.
Enhancing the Overall Customer Experience
As more customers start using your product and its features, you'll be able to gather more in-depth insights into how they use it. Then, you can identify the most popular features, what customers find user-friendly, and where they face roadblocks. This data will give you insights into how to improve the customer experience.
Effective Strategies for Customer Activation
If you don't teach users to derive instant value after the initial conversion, they'll lose interest. This is one of the main reasons for churn.
Try these strategies to turn inactive users into active ones and keep new users interested right from the start.
Redesigning Confusing Page Elements
If your customers don't understand your product at the first interaction, it might be time to rethink its interface and layout. Maybe your page has too many CTAs competing for attention, hard-to-navigate menus, or key features that don't stand out.
To figure out what's frustrating your users, you need to understand how they use your site.
User activation tools like Hotjar can help you visualize user behavior through Heatmaps, showing where they scroll, click, linger, and ignore. Session Recordings display frustration in user activity, such as repeated clicking, to pinpoint and fix bugs quickly.
These tools allow you to step into your customers' shoes to see what works and what doesn't. You might notice users:
- Clicking on things that aren't clickable
- Struggling to navigate your website/product
- Overlooking your key prompts
Use these insights to simplify their journey so they can find value in just a few clicks. For example, you may reduce the number of CTAs, add dropdown menus or breadcrumbs, and highlight key features and prompts.
Improving Customer Onboarding
Customer activation is all about delivering value and guiding users through their journey. Providing a first-rate customer onboarding experience shapes users' perception of your product's value.
To create an effective onboarding process, keep it simple. Clearly demonstrate how to use your product without overwhelming users with constant tooltips and introducing too many features at once.
Ausmed, an Australian company, offers a great example of simplified onboarding. To improve its 15% activation rate, the company redesigned its flow. Once clunky and hard-to-navigating, their welcome pages now include:
- Tooltips guiding the user to document their first task, which keeps them on the golden path.
- A single purpose for each onboarding panel, so users don’t get overwhelmed.
- No extra or unnecessary fields in forms, allowing users to complete them faster. As a result, they improved their customer activation rate to 75%.
Creating In-App Experiences
In-app tooltips and hotspots placed strategically along the customer journey can inform users about additional features and how to use them while they are actively exploring your product. In other words, they guide users towards desired actions.
The key is making them appear at the right moment with a message relevant to users – the last thing you want is to overwhelm the user with the amount of information
For instance, you can display a support chatbot when signs of frustration, like rapid clicking or excessive scrolling, are detected. Tooltips can also clarify features as users hover over them for over a second.
Certain user activation tools can be useful in creating these in-app experiences. For example, Userpilot's no-code builder allows you to create flows without technical skills. Instead, you can simply use templates to create tooltips, modals, and slideouts.
Know How Your Users Behave
Once you've figured out who your audience is, it's time to examine their behavior.
Start by mapping out their journey with your product or service – this will allow you to visually represent the various stages and touchpoints users go through when interacting with your product. If you look at examples of customer journey maps, such as this one from Spotify, you'll notice they all rely on data to predict user behavior and improve their experience.
When following a user's journey, pay close attention to those 'Aha' moments when they realize your product's value. These moments dictate where you should concentrate your efforts to activate customers.
For instance, in a B2B SaaS messaging tool like Slack, the 'Aha' moment might be when a team sends 2,000 messages. Birchbox, a subscription-based eCommerce company, might find the 'Aha' moment in a customer's first subscription renewal.
Recording how users interact with your website can provide valuable insights. You may discover that the user flow isn't smooth, causing customers to miss important actions and features. Use this information to make your website more user-friendly by highlighting key features, removing unnecessary elements, and simplifying the navigation menu.
Building Your Customer Activation Funnel
What is the user activation funnel? To keep it simple, it's a step-by-step map that shows how users go from hearing about a product to using it happily. Its stages include:
- Awareness: When users learn about the product, such as by reading a blog.
- Signup: When they sign up for a free trial or free plan.
- First Value: When they see the product's real value for the first time – the "Aha!" moment.
- Activation: When they actually start using the product and realizing its benefits.
Activation Funnels vs. Sales Funnels
At first glance, the activation funnel sounds a lot like the sales funnel. When you take a closer look, you'll see there's a big difference.
They're both key to understanding customer acquisition, but they focus on different stages of the user journey.
The activation funnel zeroes in on converting people who just signed up or tried the product into regular users. It's all about getting them engaged and active. It also tracks metrics related to user engagement, such as logins, interactions, or feature usage.
Meanwhile, the sales funnel is about the bigger picture—it turns potential customers into paying ones. It starts with lead generation and finishes with closing a sale. The sales funnel tracks metrics related to lead generation, conversion rates, and revenue.
Creating an Effective Activation Funnel
There's one last question left to answer: how do you create a killer activation funnel that increases your activation rate? Let's look at a few strategies.
Defining User Personas
User activation success is based on your customers' in-depth understanding. You might already have a user persona, but you'll need to review and update it to ensure accuracy. Keep these two tips in mind:
- Look beyond basic demographics like gender and age. Instead, dive into your customers' desires, needs, and motivations. How does your product address their problems and fulfill their wants?
- Conduct customer interviews or surveys. Ask both open-ended (e.g.: How do you envision our product improving your daily workflow?) and closed-ended questions (e.g.: Do you prefer using our product on desktop, mobile, or both?) to learn what they want from their product experience (PX).
Mapping the Customer Journey
After gathering information about your users and their behavior, you should compare the journey of your average user with the most loyal ones
Study how they use your product – look for patterns and features they favor. Take advantage of these insights to create a 'golden path': an ideal journey for users to maximize product value.
Then, focus on optimizing this journey regularly to guide users to derive value as quickly as possible. You can do this by analyzing user behavior and feedback to find and remove pain points and bottlenecks.
Identifying Activation Points
Once you've figured out your user journeys, jot down the things that get them started using your product. These are called activation points.
Activation points can be as simple as initial signup or as complex as completing a series of steps, including:
- Setting up a profile,
- Customizing preferences,
- Performing specific actions within the platform, and so on. For Slack, an activation point is when a user has sent around 2000 messages; with Uber, it's when they've booked their first ride.
Best Practices for Achieving High Customer Activation Rates
There’s no specific “ideal” activation rate – generally, the higher, the better. There are certain practices that can help you maintain a high customer activation rate.
Understanding the Customer's Needs and Preferences
To ensure your customers connect with your product, you'll need to understand what they want.
Firstly, when you map out your customer journey, don't skip out on creating user personas. Conduct research via surveys and user behavior analysis to figure out your users’ pain points, motivations, and what they need from your product. For example, a “Busy Parent” persona may need convenience, while the "Budget-Conscious Shopper” will prioritize affordability.
However, the best way to understand your users is by talking to them directly. You can use surveys to hear their thoughts and learn what's stopping them from using your product or what improvements they'd like to see.
Your surveys should focus on topics like customer satisfaction, product feedback, and feature preferences. The responses from these surveys will tell you how your customers feel about your product and find ways to give them more value.
Implementing a Minimum Viable Onboarding Playbook
Think about the smallest useful version of a product – that's the minimum viable product. Minimum viable onboarding applies this idea to getting users started with your product.
To create a minimum viable onboarding playbook, focus on the most important part of getting users started: activation. Product tours may seem like the best way to activate a user, but they can be lengthy. They often make users passive and skip over them because they don't see the relevance yet.
A better approach would be to let users discover features on their own but with a personalized experience to keep them motivated. Understanding your users' motivation is key to creating a minimum viable onboarding playbook.
Using Step-by-Step Guides to Key Features
Most companies start off with a product tour to guide users in-app. But these tours often drag on, lack personalization, and can be dull.
On the flip side, interactive walkthroughs lead users through specific product features step by step, making it easier for them to navigate and engage. Unlike tours, these walkthroughs encourage users to actively interact with the product rather than just passively listen to explanations.
Let's look at Evernote, a task-management app. Their walkthroughs don't just explain what each feature does – they also encourage customers to engage with the product. As a result, they’re able to improve user understanding, activation, and retention.
If something seems confusing, a short video pops up to offer extra help. By the end, customers have made their first note or to-do list, checking off an activation point.
Measuring the Success of Your Activation Funnel
Now, your users are smoothly navigating the golden path – your job is done. Well, almost done.
You can improve by streamlining the process even further with the help of funnel analysis. It shows how many users move through each stage and how much time they spend. If there are bottlenecks or slow conversions, that's where you should focus your efforts.
Then, you can measure the success of these efforts by analyzing the conversion rates at different stages of the funnel.
Summary
It’s not enough for a customer to just buy your product – you also want them to experience its complete benefits. That’s exactly what customer activation is.
Now that you know the most innovative activation strategies, the only thing left to do is encourage users to interact with your product with personalized guidance.
When you showcase how to derive value from your product, even the most passive customers can transform into committed, active users.