The Ultimate Guide to Product Adoption in 2022
Every time a new user signs up for your product, it's an incredibly satisfying feeling. After all, your team spent countless hours building it, marketing it, and finding potential users for it. However, how will you know how many users will stick around and become high-value customers? How many will use the product religiously, share it with their friends and family, and become the brand advocates you've always wanted?
It all depends on how well the product can be optimized to increase product adoption—in short, how effectively you can convert new users into the power users you need to sustain your business. So while you may have a fantastic product, you need a high product adoption rate to succeed.
This one-stop guide will teach you everything you need to know about maximizing product adoption in 2022. We'll cover product adoption, each stage of the process, how to track and measure it, and how to optimize the product to increase adoption. Get ready to be an expert in guiding potential users to genuinely embrace your product, from the early stages to brand advocacy.
What is product adoption?
Adoption is about more than getting someone to use the product. Instead, it's heavily tied to the value they gain from it. Product adoption happens after users learn about a product, try it, and finally embrace it as a beneficial tool for solving their problem. The product adoption process involves multiple small steps to convert a potential user into a satisfied customer.
When users find value in a product, they build habits and come back frequently, making the product sticky. These habits, in turn, lead to adoption. A high product adoption rate has various benefits, like decreased customer churn, improved user retention rates, increased subscription renewals, and more stable revenue and growth. It's essential for building a sustainable business, where people love your product and want to tell the world about it.
Why is product adoption so important?
Product adoption is essential because it's an early indicator of user retention. Optimized product adoption improves retention rates and encourages expansion opportunities. So, if net revenue retention is crucial to your business, product adoption should be a significant focus when growing a product.
Churn is the last event in a customer's life cycle, so the opportunity to retain a customer must fall before they cut ties with your product. Regardless, some companies attempt to improve retention by taking a reactive approach, for example, trying to save an at-risk customer with intense focus for 90 days. However, this isn't a sustainable or scalable method.
Luckily, there's a better way to improve customer retention. Prioritizing product adoption is an excellent way to reduce churn and boost revenue. When product owners focus on getting users invested in their product, it becomes more ingrained in their daily lives. Higher user engagement heightens the product's value and creates more satisfied customers. As time goes on, switching products becomes inconvenient and less attractive for users, and subscription renewals become easier. If the product adoption process is improved, users will be more open to sticking around for the long haul.
What is the product adoption curve?
The product adoption curve illustrates how diverse customer segments adopt a new product at varying stages of a product's lifecycle. It comes from a theory developed by Everett M. Rogers, who contends that there are five distinct stages for product adoption:
The first adopting segment is the innovators. They typically have technical traits and are considered to be technology enthusiasts. Innovators don't mind bugs or missing features. They're risk-takers and like to be the first to try a new, unproven product, which makes them an excellent source for early feedback. However, their enthusiasm is fleeting because they usually quickly move on to a new product or idea. Innovators prefer products free or at a discount and generally won't pay premium prices.
Unlike innovators, early adopters try to find solutions to real problems and generally have access to capital for innovative pursuits. They're often thought leaders in their industry and look for disruptive products to try. Early adopters are visionaries, so it's not difficult to convince them of a product, but since they're a tad more risk-averse, they require positive reviews before adopting new products. Since early adopters are all about solving real problems, they're less tolerant of missing features, bugs, and other technical issues. They also want more support when trying a new product and expect customization, making them a demanding customer segment.
The early majority enjoys business continuity and doesn't want to pioneer new products, which is a significant shift in attitude from the previous two stages. The early majority is also slower at making decisions and prefers to allow others to test new products before they do. They would rather rely on positive reviews from those who have had success with a product before making the leap. They are a challenging customer segment because they primarily communicate with each other and less with early adopters. This can be frustrating for product owners, as early adopters are the best to provide them with references. Gaining the interest and trust from the early majority is usually a sign of product/market fit, and where you can typically find a loyal customer base and a tremendous potential for growth.
The late majority is next up to adopt a product. At this stage, we reach the peak of the curve, where the early majority and late majority cross paths. Things start to slow down a bit here, as customers in the late majority are conservative, don't proactively seek change, and don't have large budgets for new products. Although they dislike change, the late majority recognizes that failing to adopt products can put them at a competitive disadvantage in the world. They don't like that, so they tend to adopt products out of necessity instead of curiosity (but only the thoroughly tried and tested products.)
Laggards are the final adopting segment and are usually less comfortable with new technology. They are skeptical, value traditional ways of thinking and doing things, and resist change more than any other customer segment. They'll typically cave eventually, but only when not using a product makes their daily life unbearably difficult or if their traditional methods are no longer acceptable or available. When laggards come on board, a product has already reached its prime in the market.
The 5 stages that lead to product adoption
The first stage of product adoption is awareness, a person's knowledge or understanding of the product. A potential customer may not even know that your product exists or may not realize the problem that your product solves. Educating potential customers about your product and its benefits is vital to spreading the word and making your product stand out. Investing in digital and social media advertising and putting together a killer marketing team are both essential keys to raising awareness about your product.
After a prospective user is aware of your product, it's time to get them interested in it. This step takes them from general knowledge of the product to seeing its value and a potential solution to the problem they're trying to solve. The prospective user may research your product or a competitor's product to get more information. Product owners can help them discover more about the product by providing in-depth videos, blog posts, and an active social media presence.
Once the information-gathering stage has been completed, the prospective user will naturally begin evaluating your product compared to its competitors. Here, they'll decide if the product is a good solution for them and whether or not they'll purchase it. It's essential to have accessible marketing material to outline features in a product versus its competitors in this stage so that the prospective customer can evaluate the product better.
After research and evaluation come the trial stage. The user has now decided that the product is the best solution for them and will purchase it (or participate in a free trial) to test it out. Allowing users to try out the product before they fully buy it can be a great tool to let the potential customer see the total value of its offerings. Temporarily reduced costs, money-back guarantee, or free trial can all assist the user in getting a feel for the product and fully understanding how it could benefit them. Strong customer success teams that can create a successful onboarding process are vital for this stage to lead to product adoption.
If the trial stage goes successfully and the user is satisfied with the results, they will move into the last stage of the product adoption process and fully adopt or buy it. This process is critical to converting prospects into paying customers and hinges heavily on customer success, marketing, and sales teams to do most of the work.
How to increase production adoption
Improving a product is the best way to improve the adoption process, from making it more sticky to decreasing friction in the onboarding flow. Providing a solid user experience throughout the product adoption lifecycle ups your chances of gaining full adoption. Follow these tips to help you create a seamless product adoption process:
Improve the user onboarding experience
The onboarding experience is your first and only opportunity to make a great impression. Users will abandon your product if they find the onboarding process confusing or incomplete, or they may not even get started with your product at all. Improve your onboarding experience and encourage adoption by identifying and fixing knowledge gaps. One great way to improve the user onboarding experience is by implementing product tours. Product tours encourage users to take meaningful action and decrease new users' time to value.
Conduct user research and testing
User testing gives insight into how customers are using the product and what kind of issues they're having. Conducting user research provides an in-depth look into users' behavior and feelings about the product. Product teams can use the qualitative and quantitative information to make significant improvements.
Implement in-app messaging to target users
In-app messages and tooltips are a small but powerful UI pattern designed to give users instant value. They nudge users toward features, help during onboarding, offer on-demand support, and provide users with additional information or 'helpful hints' at the optimal time in their workflow. Tooltips are invaluable because they're hyper-specific and contextual and are most frequently attached to an individual element within a product and convey a targeted message.
Promote new product updates and features
Communicate new features and updates both inside and outside of the product. Highlight new ways the product can help users and show your commitment to improving the product and bringing more value. However, building in-app product announcements in-house can be costly, time-consuming, and challenging to maintain. With Lou, you can launch new feature announcements for free in just minutes, with no dev time required.
Product adoption rates differ for everyone
The most important part of increasing the adoption of a product is to keep a close eye on your user base, discover and iterate on their needs, and make adjustments quickly. Remember that you can't rush the product adoption process. You can only consistently improve the product and make the product's onboarding flow as seamless as possible.
With Lou, you can provide users with in-app guidance and support to improve their experience and power user adoption. Learn more about Lou here!
Published on January 27th, 2022
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