Customer adoption is a very important element of a successful business, yet it’s still sometimes misunderstood.
So, let’s ask ourselves: What’s customer adoption, why’s it important and how can you increase it?
What’s Customer Adoption?
Simply put, customer adoption is the process of customers learning about your product and deciding to use it. Product adoption is complete when the customer loves their purchase and gets so much value out of it that they couldn’t imagine their life without it. When you have a high customer adoption rate, you have lots of loyal customers who keep coming back for more.
The most successful companies in the world, like Facebook, Amazon, Shopify and Apple have all nailed product adoption. Chances are, there's at least one company in that list (likely more than one) that sells a product or service you use every day or close to every day.
Obviously, a higher customer adoption rate is good for your bottom line.
The more people buying and regularly using your products, the more money you’re making from sales.
On top of that, the more people using your product, the more chances for someone else to hear about it. For example, a new Shopify customer who’s blown away by the ways it’s improved its business is likely to share it with friends and colleagues in their professional circles.
Remember: Good old-fashioned word of mouth is still one of the most reliable marketing methods and higher product adoption creates more brand advocates who will spread the word.
Understand the Customer Adoption Curve
The customer adoption curve serves as an illustration of your adoption rate over time. The curve can be split up into four sections, each representing a particular group of customers who adopted your product at a particular time:
Innovators are your first users. This group will mostly include people within your network. These are your initial customers who give your earliest feedback and help you get the ball rolling.
Early Adopters are those who find your product early in its life. While they aren’t on the ground floor like Innovators, they’re probably some of the first customers who are outside your network. Early adopters help you build traction and signal others to take notice.
Early Majority refers to the influx of customers that happens after the Early Adopters have paved the way and elevated the product into a more visible position. Your Early Majority helps you build more momentum and cement your product as a major player.
Late Majority refers to the large chunk of customers who “catch on” after the product is already successful and widely adopted. These customers round out the rest of your customer base, but they probably won’t come around until after they notice significant adoption among their peers.
Laggards are the very last group to adopt your product. They only do so to keep up with what everyone else is doing or because the product becomes so widely used that they feel forced to use it as well. You’ll get a trickle of Laggards to finish off the adoption curve, but it usually drops off sharply after the Late Majority.
Typically, your customer adoption curve will start out flat and start to rise gradually as you find your Innovators and Early Adopters. Then, the curve will start to pick up as the Early Majority starts to trickle in.
By the time your late majority jumps on board, your adoption curve will have peaked and begun to fall. Finally, you’ll likely see the curve taper and flatten as your product becomes widely adopted and only the Laggards are left.
Remember, few products will have a ubiquitous impact.
Depending on your industry, your customer adoption curve may have a much narrower user base. You should evaluate your product adoption curve with this in mind.
Improving Customer (User) Adoption
So, what's the best way to improve customer adoption?
The best way to improve customer adoption — and maintain it long term — is to adopt a robust customer education strategy that offers comprehensive product education.
Reduce Time to Value
Time to value (TTV) is the amount of time it takes for a customer to start getting the value they expect from the product they’ve purchased.
When customers have access to online product education resources, they can learn how to use and troubleshoot the product quickly. This means they can start using the product and getting value from it right away.
A Better Onboarding Experience
Onboarding is an extremely important part of the customer journey. During the onboarding process, customers learn how to use the product they’ve purchased. If the onboarding experience is difficult or inefficient, the customer won’t be able to get the intended value from their product.
Using an LMS to create engaging and informative onboarding courses can help ensure your customers are ready to start using their products in little time.
Customer adoption isn't a one-time thing. Sure, getting your customers to adopt your product as quickly as possible after signing the dotted line (or entering their credit card number) is important, but what good is it if you can't get them to adopt new features as your product evolves.
Yeah, not good.
Customer education ensures that your customers perpetually have the resources and support at their disposal to evolve with your product and continue to realize its value of it — even as their roles and goals evolve.
How To Measure Customer Adoption
Now that we know what customer education is and why it's important — and how customer education can help — you may be wondering how to measure it.
While it may sound complicated, it's not. And you're probably already doing it, even if you don't know it.
Measuring customer adoption is basically the same as measuring product adoption.
So, if you're measuring the latter, you're measuring the former.
Customer Adoption Formula
How do you calculate customer adoption?
Simple. Here's the formula and an example:
(Number of new users) x 100 / (number of total users).
You have 100 new customers this month and 1,000 overall. To get your customer adoption rate, you’d divide 100 by 1,000 and then multiple by 100.
So, in this example, your customer adoption rate would be 10%.
Increasing Customer Adoption With Northpass
As your product or service becomes more complex and your customer base grows, gaining product adoption will become more challenging.
So, too, will the customer education program you employ to drive it.
Northpass can help.
Reach out today to explore Northpass and see how our award-winning LMS can help you automate much of your program, streamline processes, analyze performance and a whole lot more.