That's because even the best type of user onboarding might not be the best for your users/customers. You need to be maintaining and optimizing your onboarding experience constantly.
And what better way is there than measuring your onboarding flow success with some effective metrics?
In this article, I will talk about how you can measure SaaS onboarding effectiveness, how some metrics make this process more efficient, and how you can apply them.
How is SaaS Onboarding Effectiveness Measured?
SaaS user onboarding, although not a new process, is quite obscure and unaccounted for when put into numbers. It is hard to pinpoint what makes it effective or what defines good user onboarding. Yet there are still ways to perform a calculation of effectiveness using certain key metrics and KPIs.
User Onboarding Metrics and KPIs
Along the user onboarding funnel and the customer journey are certain pain points and instances that have a great impact on the overall customer experience, user engagement, and at the end of the day, customer satisfaction.
These little pain points and instances of dissatisfaction during the onboarding processes can affect the user onboarding experience so greatly that they may even have a negative or positive impact on the acquisition and retention rates.
What, then, the manager responsible for the success of onboarding need to do is apply certain solutions for a more successful user onboarding.
In the end, what makes the manager observe better or worse results is what defines user/customer onboarding metrics.
Depending on the product and the specific business goals of the organization, these metrics can range anywhere between churn rates, successful product adoption rate, product usage, number of active users, feature adoption, trial conversion rate, and many other metrics and KPIs.
While the reasons for the observation of a specific metric might not be the same for every company, the ultimate goal is always to implement a more and more effective onboarding experience and, in extreme cases, switch the onboarding strategy at hand with a new one.
Then, what are some user/customer onboarding metrics? Let's take a look together.
Top User Onboarding Metrics in 2022
1- Churn Rate
Churn rate is one of the most important metrics for user onboarding, not just because poor onboarding is among the main contributors to churn but also because it is the sole most important indicator of instability of your business.
Still, looking into churn rate is the most meaningful when considered in tandem with different metrics and KPIs and also different software like heat mapping.
Measuring your churn rate is one of the least complicated calculations you will make.
Simply pick a time period you would like to look into your churn rate, divide the number of customers/users that churned by the number of customers/users you had at the beginning of the selected period, and lastly, multiply the result value by 100.
If you are wondering what defines a good churn rate, for SaaS, a churn rate of 5%-7% is considered good.
2- Average MAU/WAU/DAU
Average monthly active users, weekly active users, and daily active users are great metrics to give you a sense of how many users are using your product in a given timeframe.
In the context of user onboarding, it can work similarly to the churn rate metric. But if you were to make it more specific, average MAU/WAU/DAU could show you insightful data after a new user onboarding phase is launched or a new feature onboarding flow is used.
To calculate your average MAU/WAU/DAU, you can use Google Analytics or a more sophisticated solution like Mixpanel. However, if you have the data for your MAU/WAU/DAU, all you have to do to find the average is:
- Average MAU: divide the number of each month's unique users by 12,
- Average WAU: divide the number of each week's unique users by 7,
- Average DAU: divide the number of each day's unique users by the number of days in the month
It is also important to keep the ratio in mind, especially the MAU/DAU ratio. To calculate it, divide the number of daily active users by monthly active users and multiply the result value by 100.
By finding out the MAU/DAU ratio, you can easily observe the effectiveness of a recently started onboarding flow or other changes.
3- Average session Duration
Quite similar to the purpose of the above metric, session duration helps find and understand user behavior.
Session duration is essentially a metric that is used for customer success, but as user onboarding is a great factor in increasing customer success, session duration can bring out data to improve user onboarding as well.
For example, by looking at session duration, it is possible to see the difference between a bad onboarding phase and a good one and how adopting a better onboarding flow changes session duration.
It is also important to view the data from session duration in light of similar metrics like MAU/DAU ratio and other bigger metrics like churn rate.
To find out how long the session durations of individual and groups of users are, you can use Google Analytics as well as other tools. To measure the average session duration of your product, all you have to do is take a specific time period and divide the total duration of sessions by the total number of durations in that specific time period.
4- User Onboarding Process Completion (Average Time)
A more specific and more relevant metric for user onboarding success is user onboarding process completion. It can be used to see how fast users complete an onboarding process and improve onboarding content to minimize the required time as much as possible.
But also, using more sophisticated tools, it is possible to see which parts of the onboarding process are taking the most time, what material is hard to learn for users, and more.
So, this metric can affect the product itself as well.
To calculate the average time users spend to complete an onboarding process, a SaaS tool might be required. Whatever tool you opt to use, what matters is that the completion rate is short but not shorter than expected.
Average times that are too short might be due to rapid skipping.
5- Customer Onboarding Checklist Completion Rate
An onboarding checklist is a great addition to any user onboarding strategy as it keeps everything nice and organized while giving the users a sense of success and a full display of value.
Thus, it is important that you can get your users to complete onboarding checklists.
What's equally important, however, is that you monitor the process of your users completing the checklist. By doing so, it is possible to pinpoint onboarding steps that aren't performing well, see whether there is a need for a reduction on the steps, or simply assess how successful your onboarding process is.
If you've created your onboarding checklist in-house, you may ask your developers to give you data on the number of completed onboarding checklists; and if you've used a no-code tool to create the checklist, there is certainly analytics to show you the data.
Once you know how many checklists have been completed, you can then divide the number of completed onboarding checklists by the total number of checklists that were started to then multiply the result by 100.
6- Feature Adoption Rate & Product Adoption Rate
Product and feature adoption rate is possibly the most significant metric when talking about user onboarding success.
This is because the reason why user onboarding exists is to increase the adoption of a product and, on a micro level, the adoption of features. In short, if your adoption rates are high, you are doing a good job getting users familiar with your product which consequently means you are more likely to achieve user/customer retention.
To calculate your product adoption rate, you need to set a timeframe, take the number of new active users and divide it by the total number of users and multiply it by 100.
Though it is a bit more complicated, the same is true for feature adoption rate; you can find it by dividing the number of active users of a specific feature by the number of total customers to then multiply it by 100.
7- Customer Feedback
Though customer feedback is not necessarily a metric, it can be considered an important KPI as the very thoughts of users might be more effective in improving user onboarding than their behavior.
This is why it is extremely important to always encourage users to leave feedback, whether it is through a button on the UI or via email.
Luckily, most user onboarding tools offer NPS survey or feedback form UX elements that make the collection of feedback easier and more streamlined. If you do not use such a tool, it is still a good practice to leave an email on your website or just a button for a feedback form.
8- User Retention Rate
Finally, the user retention rate is a metric that is closely related to the success of your user and customer onboarding process. Knowing that 86% of customers say that a better onboarding process would make them more willing to stay loyal to products, the connection is clear to see.
So, it is crucial that when it comes to user onboarding success, the user retention rate is also factored in.
The calculation is quite simple. After deciding on a period of time to measure, you can take the number of customers/users at the end of the timeframe, subtract the number of new customers/users, and divide it by the number of customers you had at the beginning of the timeframe, then multiply it by 100.
Conclusion
Customer onboarding success can essentially be as important as the success of your product for the reason that a value proposition is hard to see without proper onboarding. So, it is crucial for any business to implement a user onboarding process and monitor its performance accordingly.
