If you run a digital company, particularly one engaged in SaaS or a subscription business, the line between somebody being a prospect and a customer is not always clearly drawn. If you’re involved in a startup, it’s easy to get excited when every visitor to your website seems to be signing up for your services or starting free trial accounts. However, as startup-guide author Justin Mares was quick to point out in his 2014 KISSmetrics blog post, 6 Advanced Steps for Doubling Your Activation Rate, until your new sign ups take action to derive value from your product or service, success is far from assured. That’s why activation metrics are such a critical measurement to get on top of. There is no more potent indicator of digital business performance than the rate at which customers are “activated”.
Shake Well to Activate
While the thought of activated customers might summon images of a B-movie, it actually refers to the point at which customers initiate an “activation event”. When someone signs up for your service or software for example, you can be said to have acquired that person as a customer, but activation only occurs when he or she actually makes use of it. Even this doesn’t always mean that you and your customer are now bound in a happy relationship. As Justin Mares explains, up to 60% of people who sign up for a trial software product make use of it one time before abandoning it.What is an Activation Event?
As previously mentioned, an activation event takes place when a customer that you have acquired, get’s the value promised by your marketing activity. Sidekick’s Dan Wolchonok explains the main elements of an activation event in his Hubspot Product Blog article, The Metric Watched by Top Startup Growth Teams. Dan identifies these elements as follows:- The activation event has to be meaningful in terms of the value delivered to the customer
- It’s strictly a one-time event
- It signifies your business’ effectiveness in getting customers to realize value from your product or service
Jame says
Hi Dan,
Great article. I’ve been looking everywhere for good comparables to judge my activation, but nobuy seems to share. Any idea of comparables?
Thanks,
James
Serge Mosin says
Super nice overview and examples of Activation metrics. However, you also mention Retention as one of the Activation metrics, which I think is not entirely correct. It is a standalone measure to be addressed separately.
Otherwise great and super informative post, thanks!