TLDR:  What happens the first time your customer logs into your SAAS or membership site?  Will they be successful…. that is, “activated”   …or will they give up .. and conclude “It’s too complicated”… or “This product just doesn’t work for me”?  
How can we make product adoption easier?

What is customer activation?  It’s the first step in a process that you deliberately put in place to get a new customer hooked on and valuing your product, so that they don’t leave.  

Increase your customer activation rate for new customers and you just pulled the biggest lever you have in your  SAAS and Membership business RETENTION toolkit.

  Yet activation can quickly go awry simply because customers feel…  (1) overwhelmed (2) buyer’s remorse (3) confusion over how to solve their specific problem and (4) lack of trust in your company and product. 

This article details exactly how any one of these feelings can cause customers to give up without seeking help… and what you can do about it.  

Activation doesn’t have to be scary for the customer.

In the “What to do in Week 1” section of this article and example that follows, you will see the exact method of fear removal,  how to get your customer a specific quick result, establish two-way communication and overdeliver so your customer sticks around.

I’ll be releasing fully-scripted examples and swipes in August, 2024 and an extensive workshop where we focus on creating activation sequences for your specific product. 

Click here to get early notice of workshop opportunities.

….

A Coffee Break! 

Imagine you’ve just purchased a sophisticated new espresso machine.  The aroma of the perfect latte that you desire fills the coffee shop where you bought the machine and you can’t wait to enjoy that very same aroma in the comfort of your home, first thing, every single morning.

Now, picture two different scenarios:

You take the espresso machine home and, when you open the box, you immediately notice a complex array of knobs and switches on the machine…  It’s unclear how you make that latte that you crave…. and indeed you feel like you will need several strong cups of coffee before you can face the complex instructions in the manual. 

So you wing it, grind some beans and hit the brew button…. Alas, the coffee doesn’t taste very strong, and you  find out the hard way that you don’t know how to froth the milk without sending it flying all over the kitchen …. Frustrated, you go back to your old, simple coffee maker.

In the second scenario, before you leave the coffee shop, a barista offers you a complimentary tutorial. He shows you how to adjust grinder settings for your latte’s coffee strength, giving you tips on frothing milk and cleaning the machine. Forget cappuccinos!  He focuses on nothing other than the specifics of how to make a latte because that is what you want.  You leave the shop feeling confident and excited to use your new machine, and soon you’re enjoying the best latte you’ve ever made at home.

How exactly does this story relate to to operating profitable  SAAS and membership sites?

HOW TO INCREASE CUSTOMER LIFETIME VALUE

The Real Sale Occurs AFTER Your Customer Signs up 

What are customer retention strategies that you can use right away?  How can you increase customer satisfaction?

Here’s a start – Consider:

“What does my customer want… Specifically?”

and
“What fears are going on inside my customer’s head?”

The espresso machine story nicely illustrates how fear… the emotions triggered when your customer’s immediate struggle to get a specific result ….caused adoption to immediately grind to a frustrating halt … like a freight train when the emergency brake is applied. 

Customer retention can be ensured by removing fear.

That espresso machine might sit on the shelf unused or get returned when fear and doubt as to how to use it arise.   Your SAAS or membership customer that you spent money to acquire… has every reason to just cancel their subscription in frustration.

Customer retention can be ensured by getting new customers one specific, personalized result quickly.

Churn cuts profits more than you think

How Much Is Churn Costing You? 

The first month is critical for customer retention. For SAAS tools, the average churn rate, that is the percentage of customers lost, is around 3-7% annually. 

On the face of it, this may not sound like much yet its effect on profits compounds month after month, more than you think.

Indeed, increasing customer retention rates by 5% increases profits by 25% to 95%, according to research done by Frederick Reichheld of Bain & Company.

 If you offer a free trial period, activation within that period is your objective so that you can monetize the customer.

What about online membership sites?

A 2022 survey by MemberGeeks reports an average MONTHLY churn rate of 6.8% for memberships.  That’s the equivalent of losing over half of your new customers in 10 months.

Completion rates for training courses, where the subscriber is left to their own devices with no support or community, are a mere 10-15% according to NovoEd. 

These numbers highlight the urgent need for effective customer activation strategies.

To learn more about churn, check out this article.  

GET CUSTOMERS ONE QUICK RESULT

What Happens When Customers Don’t Get Instant Gratification? 

 Why are B2B sales based on personalized training?

Zhecho Dobrev, author of  The Big Miss: How Organizations Overlook the Value of Emotions surveyed more than 19,000 customers in the U.S. and UK. 

He found that emotional attachment was the biggest driver of value, being responsible for about 43% of business value. Just 20% of value was perceived when a company promoted product features.

As an example, imagine you log into a membership site for the first time and within 30 minutes you feel like you got more value than what you paid…. Instant gratification – You feel emotionally accomplished .. “I made the right decision”….

One quick result provides instant gratification, with the customer feeling “I got my money’s worth in the first 30 minutes”! 

MITIGATE FEAR

What Is Really Stopping The Customer From Adopting Your Product? 

Human brains are wired to fear new things. When customers first interact with your product or service, they are most likely experiencing a mix of excitement and anxiety. According to Joseph LeDoux in his book Anxious: Using the Brain to Understand and Treat Fear and Anxiety, the amygdala, a part of the brain associated with processing emotions, often triggers a fear response when faced with new and unfamiliar situations. This can lead to strong emotional feelings of overwhelm and doubt when using an unfamiliar product.  Customers quickly “feel stuck” at the first sign of a hurdle. 

What are four fears that new customer faces with a new product?   

1. Overwhelm: They are confused about where to start – made worse if your product or onboarding bombards them with training on feature after feature.  Just as the barista broke down the complex features of the espresso machine into manageable steps, your onboarding should guide users through the path to a result.
2. Buyer’s remorse: After making a purchase, customers may start to second-guess their decision.  Any negative experience amplifies their remorse.   To avoid this, highlight quick wins. The barista’s helped a new owners quickly make a great latte, validating their purchase decision. Similarly, your onboarding should provide an immediate, tangible benefit to reassure customers.
3. Unclear how to solve their specific problem: A big mistake with customer onboarding is to make broad.  Another big customer gripe is that the training is focused on product features. Instead, ask interactive questions about the RESULT that you customer is looking for – so you can direct the customer on how to solve their unique problem.  Just as the barista asks about coffee preferences and focused on how to making a latte, you should personalize your onboarding to address the most common specific problems your customers face.  SOLVE THEIR PROBLEMS.  
4. Trust issues: New customers usually don’t know you. They will feel isolated when they can’t easily figure out how to get results that they need.  Prompt customers for personalized open communication.  Create feedback loops to reassure them, just as the barista’s offered personalized,  latte training.

CUSTOMER ACTIVATION STRATEGY

What To Do In Week 1 

You can implement three things to overcome customer fears and grant instant gratification. We recommend that you do all three during the customer’s first week:

1. “One personalized quick win”.  Create an onboarding sequence that guides new customers to achieve one quick result that the customer personally told you that they want.  The simplest way to do this is have the customer choose their goal from a selection that you provide. Then have that choice dictate the onboarding sequence to run.   I recommend a “getting started” checklist on the homepage when users first log in, an email or video sequence that breaks down the process into small manageable steps. Each video step no longer than 5 minutes to watch given that people have an average attention span of less than 8 minutes.   Single steps minimize the overwhelm by hand-holding your customer so that they remain confident. The simpler, the better. 
2. Create a Two-Way Relationship: Make the experience feel like it’s personalized.  From the beginning, encourage feedback loops, getting customers to communicate progress and feedback with you. Ask them about their specific problems and adapt their journey accordingly.   Ask for feedback and reward it. Detect lack of progress and offer help.  This can be as simple as monitoring whether they play and mark a video training step “DONE”, whether they check off items in an onboarding checklist, or it could be an email with link to a training video and request to reply “DONE” once the task in the video has been completed. Follow up is key.
3. Overdeliver: Go above and beyond customer expectations, with personalized feedback based on what they told you their problem was. Provide “going the extra mile” additional value— such as PDF workbook resources, personalized tips, or proactive support and check ins.

CUSTOMER ACTIVATION EXAMPLE

A Targeted Email Onboarding Sequence 

Here is an example of a targeted email onboarding sequence personalized and focused on guiding customers to one quick result. The step-by step approach hand-holds the customer to their first success.  It starts a feedback loop that establishes two-way communication. It rewards action with PDF E-book and web training bonuses that overdeliver.

• Day 1: Thank you/Welcome email.  Asks what key problem the customer is looking to solve, listing options for those problems
• Day 1: First thing you need to do to solve the problem. E.g., Step-by-step video tutorial in 5-minute steps, to get a first quick result,  with an activation reward for completing it
• Day 2: Check in. Here’s the plan (future-pace).   Offer tips. Offer help, if needed.  Ask for feedback (create feedback loop).
• Day 3: Short power training video to get even better results  + Request for feedback and asks “what is your next problem?”
• Day 4: Frequent roadblocks and mistakes that users make.  Tips and tweaks for maximizing the benefits of their first quick result. Link to tutorials on solving their next problem, each with incentives for completion
• Day 5: Recap of progress made. Include a Call To Action to download a free PDF e-book and web training with strategies that will increase their return on investment.
  Encourage them to share feedback and any challenges faced.
• Day 6: Ask customer to select a third result they want and provide link to its training, building on the initial success.

I’ll be releasing some detailed, fully scripted examples in August 2024 and an extensive workshop where we focus on implementing activation sequences for your specific product. 
Click here to get on the waitlist.