In 2023, it is a well-established fact that customer onboarding plays a crucial role in customer retention. As a critical success factor, customer onboarding is still one of the overlooked processes in any enterprise SaaS organization.
Why do I say overlooked? Because even today, there isn’t any proper way to measure the success of a client onboarding. You’d see a lot of content floating around claiming to be the right onboarding metrics of the organization, but most of them fail to help you recognize the right wins and the battles lost.
In this article, let’s look at some of the main customer onboarding metrics you need to track and why it is essential to track these metrics.
Why Tracking And Measuring Onboarding Metrics Is Important?
As for any process in the organization, measuring metrics is an important aspect for all businesses. Right from the sales handoff to the time the customer has gone live with your platform, it is very important to measure each touch point of your customers' journey.
Keeping track of these metrics will help you make sure you are cutting the clutter and only providing value to your customers.
Now let's look at why tracking and measuring customer onboarding metrics is important for B2B SaaS companies.
Increased Product Adoption
When the right customer onboarding metrics are measured, it becomes easier for your onboarding teams to set the right expectations with your customers. This leads to value delivery being equal to the value promised during sales.
When the customer realizes the product's value right at the time of onboarding, the chances of product adoption increase significantly as opposed to an unstructured customer onboarding process.
Churn Analysis
When you onboard a customer, it is most likely that you’ll be focusing on their onboarding and making sure that they get the right value from your product. However, due to tracking lagging customer success indicators, you can analyze why your customers churned only after they’ve churned.
When you track the right customer onboarding metrics with the right tool, you will be able to forecast better on your customers better since you’ll be monitoring the leading KPIs of churn.
This will also help your teams identify the excellent fit and the wrong fit customers, as you’ll see the warning signs of churn with the right KPI tracking.
Leading And Lagging Metrics Of Customer Onboarding Success
Now that we have established why tracking and measuring customer onboarding metrics, let us look at leading and lagging indicator metrics.
The question is, what exactly is a leading indicator, and what is a lagging indicator metric?
Let me help you here. Before we move on to understand the vital customer onboarding KPIs an organization needs to measure, let us look at the significant differences between the leading and lagging indicators.
Lagging Indicator Metrics of Customer Onboarding Success
In simpler words, lagging indicators are the reactive metrics of the organization. It means that these metrics can be measured only after your customers have spent a certain amount of time with your product.
Some of the lagging indicator metrics of customer onboarding successes are NRR (Net Revenue Retention), TLV (Total Lifetime Value), NPS (Net Promoter Score), Churn Rate, etc.
In all SaaS organizations, executives and the higher management folks are always interested in tracking these metrics as these metrics indicate that the product is being accepted in the marketplace and that the business objectives can be achieved.
Leading Indicator Metrics of Customer Onboarding Success
Leading indicators metrics are closely related to lagging indicators but are quite the opposite of the metrics of customer onboarding success.
These are the proactive metrics that organizations should be tracking to make their customer onboarding successful. For any organization to track the lagging indicators, it is very important to proactively track the leading indicator metrics since it would have a domino effect on the overall customer success metrics.
Real Customer Onboarding Metrics To Track
With significant discussions around the leading and lagging indicators of customer onboarding success done above, let us now look at what real customer onboarding metrics you should focus on in an enterprise SaaS setup.
Time to Go-Live
The time taken from when your customer signs your contract to when the customer is successfully onboarded to your software is the time to go live. It is very important to track this metric since it helps you set the tone of your collaboration with your customers.
In more technical terms, go-live is when the code moves from the test to the prod environment, i.e., an event occurs.
The less time taken to go live, the sooner you’ll be able to track the value of your product in your customer’s workflows.
Why is it important to measure this?
Though the go-live event looks simple in the onboarding process, it depends on various factors like implementing the right use cases, project planning, setting milestones, etc.
Failure to track go-lives and associated delays can lead to customer dissatisfaction, revenue losses, disappointments, and churns in the long run.
Time to First Value
Time to first value is your customers' “AHA” moment during the onboarding stage. When customers sign a deal with your company, they are not looking to add another software to their tech stack. Instead, they are looking to solve a problem with your product.
During the onboarding stage in enterprise SaaS companies, your customers must start finding value in your product as quickly as possible.
Why is it important to measure this?
By measuring the time taken to the first value, you will be measuring the sticky point of your product. This will help your onboarding teams better understand your customers' needs and eliminate the redundant points in the onboarding process, making it more efficient and goal-driven.
Delta of Value Promised & Value Delivered
Your sales team would have promised stars and galaxies to your customers and during the onboarding stage, the customers are keen on getting exactly what they had initially asked for (or what your sales team had promised them).
In many enterprise SaaS organizations, the sales-to-implementation handover needs to be more siloed, leading to incomplete team communication. During the go-live, onboarding teams, and the customers are usually at different wavelengths, as much of the information is lost during the handovers.
Why is it important to measure this?
Value promised vs. value delivered is a fundamental metric every enterprise SaaS organization needs to measure. This would help the onboarding teams to set the right expectations while onboarding the customers.
Measuring this KPI would also help the cross-functional teams streamline the onboarding and implementation process and make sure to track use cases asked by the customer instead of tracking tasks during implementation.
Customer Escalations & Closure Time
During the go-live, there could be chances of your customers raising escalations due to expectation mismatch. The response and the time taken to resolve these escalations also go a long way in setting the right tone for your customer relationships.
Delays and unawareness of escalations cause the customers to have an unpleasant onboarding experience, thus leading to churn in the long run.
Why is it important to measure this?
Customer onboarding is crucial to making your customers well-acquainted with your product. Quicker responses and escalations redressals can lead your customers to build trust and loyalty towards your product.
Total Onboarding Time
When customers sign up for your product, they actively seek the solution to their problems. Hence, they would like to be onboarded quickly and with faster time to value.
However, they would certainly be delighted to have a shorter onboarding time since their next goal after purchasing the product is to introduce it to their daily workflows and independently use the platform without interruptions.
The faster the onboarding process, the faster they will realize the value from your product.
Why is it important to measure this?
Measuring your customer onboarding time can help your onboarding teams set realistic goals and onboarding milestones with your customers. This way, the onboarding process can be tailored to your customers' needs and help them realize value sooner than your competitors.
Closing Notes
Peter Drucker once said, “What gets measured - gets managed.” And it stands right when you talk about measuring the right KPIs of customer onboarding.
When you measure the right metrics, it would be not too far that you’ll be counting the perfect business metrics (both leading and lagging), thereby having consistent customer success.
Looking at this scenario in the enterprise SaaS space, we’ve built CogniSaaS. With CogniSaaS, track what matters and make your customer onboarding experience a success for your customers, your teams, and your business.
Level Up Your Onboarding & Implementation Process!
Get StartedMore blogs you'd like
Sign up for free trial
