This is the key chart I look to build whenever I think about Activation.
Activation is the critical step that all product-led growth hinges on - drive activation and the flow through works further up the funnel.
To understand this, I use the model from Mixpanel and others, a great simple place to start on your Product analytics journey.
First up, define your key, high-value actions. These are the things a user or team does, that transfers the value of your product to them, creating an Aha moment.
Creating a report, cropping an image, and scheduling a post. Anything that relates to your SaaS.
For my product, FeaturePage, it is any of the following:
- Creating a feature
- Publishing a page
- Launching a poll
- Getting feedback
- Responding to a user
- Creating a report
Feature page is a simple page product people can link to, to collate votes and feedback about features they are interested in launching.
Armed with these high-value actions, you need to chart a few things. Time to first action and total % of signups who perform a key action.
But I think that doing one is not enough. Your job is to get them from activated to active, so you need to see who is compounding their actions over time. Mixpanel says the benchmark for SaaS is 12 actions in 7 days denoted Activated.
So that is your goal.
Effectively you are looking for the escape velocity of accounts - the more velocity (high-value actions) the more likely they will escape the dead zone and become active accounts.
I also like to cross this with a custom metric called account health.
Account health in this context is a weighted metric of how closely their user metrics align with that of an active account. Usually, this is a combination of sessions, login’s, users (sometimes for multi-user accounts), api calls, tracking code activity etc.
Things that are prerequisites for doing high-value actions. Eg, you can't create a poll in Feature Page, my product, unless you are signed in. The relationship between Account Health and Activation is another key indicator and can be related in a ratio to indicate when an account is stuck.
This also gives you a direct list of accounts to target with exceptional CS actions and offers (tailored onboarding, do-anything-that-doesn’t-scale type stuff).
We need to build something that looks like this:
A few things to remember with this chart:
- The goal is to leave up and to the right. Active accounts will “enter the activation stratosphere” and exit to the top right, achieving both high, and building, account health, and and an increasing high value action count.
- The dead zone is the bottom right, where failed signups go to die
- You will find your “takeoff point” for your product - where the number reached on either vector denotes account success or failure (this will vary by account type, acquisition channel and more).
- You can use this system to retrofit your ACV data, time to close, and other RRR based metrics to identify and hone your funnel into the right cohorts over time.
Here is an example of how it looks in practice for a SaaS business. The first interactive shows the lifecycle of a standard sign-up in a freemium or free trial product.
The second is an example from a real SaaS that was pushing to go to a Product Led Growth model, after chasing enterprise sales for several years. This is a snapshot of live accounts on a certain day. The second option shows acquisition channels, so you can get a sense of how each channel activates customers in the funnel.
Below is an exploration of this idea in more depth for a Martech SaaS company I built (since sold) in a Tableau workbook:
Tableau Workbook - Account Activation View
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