How To Design a Strong SaaS Onboarding Strategy

Success of any company requires its customers to be loyal to their brand. Starting this process is like sowing seeds–in order to grow a strong user base, the beginning of the process is the most crucial step. First interactions with your product need to show users how they can benefit from signing up to the onboarding process, and with the right amount of nurturing, allows them to see its value for themselves. Proper introduction to your product increases the likelihood of a solid relationship with customers, while simultaneously promising the longevity of their engagement with your company.

What Is Customer Onboarding?

In a nutshell, this is the process that introduces potential customers to your product by giving them a chance to interact with it. For SaaS companies, free trials or freemiums are the easiest way to implement this, ideally so that they can see the benefits firsthand by actually using your software. The goal of onboarding is to convert free trial users into paying customers with a high LTV, or Lifetime Value, meaning that by staying connected with your brand, they cost your company less in the long run as opposed to the cost of acquiring new customers.

The onboarding process is basically a promise to deliver a positive post-purchase experience by providing a positive pre-purchase experience. Users will know what to expect from a paid subscription when given the chance to test its benefits for themselves and see positive results.

First impressions mean everything, especially in a market as competitive and vast as SaaS. Developing a proper strategy to guide new users through onboarding and beyond is a pivotal method to increase the LTV of these customers and, consequently, your company’s retention rate.

Four Things To Consider Before Strategizing

Before you jump in to designing the various elements of the process, there are some key points to examine first in order to develop a method that works. Knowledge of these four points might change over time, so the best practice for streamlining the process is to constantly test, revisit, and update these questions as you learn from successes and failures.

1. What are your customers’ goals?

This is the most important question when preparing to develop an onboarding strategy, because it steers the direction of the process’s design to provide a positive experience for the user. Without understanding the goals of your customers, onboarding is more likely to miss the mark because it won’t guide them in the right direction. 

The first step of honing in on a deeper understanding of your user personas is segmenting them into specifically grouped categories, which allows you to better predict their goals through the analytical data collected over time. Once you know where they want to go, you can then offer tailored messaging and personal journeys for a more efficient and successful way through the onboarding process.

Here’s how to use audience segmentation tactics during onboarding:

Gather Information 

Valuable data can be collected during the signup process, and may include:

  • Size of the team
  • Type of company
  • Intended product use
  • Preferences

When users openly give you the information you need to better understand them, it becomes a simple task to figure out what segment they belong to. Other things like questionnaires can generate more specific answers if necessary, but should be kept to a minimum. If users have to answer a hundred questions before they can gain access to your product, there’s a higher chance they won’t finish the first step of signing up.

Customized Engagement

Armed with more information about your users, you can then offer individualized outreach that fits their needs. Personal touches matter. They don’t just pinpoint a user’s specific struggles to help them complete the onboarding process, they also remind the user that your company cares about their experience. This, in turn, increases the likelihood of customer retention.

Also, through the data collected during this support, your team can track things like how each user segment works with the product, how much assistance they needed, and where they struggled. The more information you can glean from these interactions only helps to make a more well-rounded user profile.

Monitor Customer Satisfaction

Are they meeting their goals efficiently? Is the path to this goal clear? Once you start seeing conversion rates of onboarding users to paying customers, you’ll have a better answer to these questions. If there happens to be a high churn rate, there may be issues in the onboarding process, and the strategy will need to be adjusted.

2. Know How Complex Your Software Is

No matter how intricate your product is, the strategy for guiding users through a learning process should be designed with ease in mind. The idea is to help them as they figure out how to use your software so they can see its value for themselves. 

This may mean having the right resources in place for getting unstuck, which can vary from self-serving support for users to find answers themselves, or preparation to offer personal assistance and detailed demonstrations on your company’s website. Make the learning process easy for them to master this tool and want to continue using it.

3. Provide Useful, Timely Information

Users should know what they’re signing up for from the beginning, especially if your SaaS company promotes more than one product. Make sure that they are aware of what’s included in the trial period, if there are differences between options, and if there are any limitations in place. Clear definitions will encourage users to make a more informed decision about their own onboarding experience, as well as prevent unwelcome surprises from impeding the process or stopping it altogether.

Besides information given upfront, the quantity of material you provide to users later on their journey is just as important as its quality. Detailed documents and tutorials are absolutely helpful, but too many resources can confuse and overwhelm users if they’re bombarded with data. Implement this kind of support at the right stage in the process when it’s most useful, and keep the subject matter relevant for simplicity.

4. Motivate users to keep going

Even the best of us need encouragement sometimes. Your onboarding strategy should be prepared to tackle motivation in a number of ways. One of the most basic tools to utilize are progress reports. Things like checklists, status bars, even simply telling the user what step they’re on in the process and how many more are left can encourage them to continue. 

Another way is through reminders and checkups like in-app notifications and emails. If a user needs a re-engagement boost to get you back on their radar, these messages can give them the little nudge they need to continue working towards the goal they wanted to reach by using your product. Maybe they’re stuck on a step in the process and considering walking away. Sending a reminder can be like extending a helping hand to offer some much-needed guidance.

Encouraging words are an easy way to reassure users and can be used after a task is completed or a milestone is reached to celebrate the success. These are simple congratulatory messages, but provide emotional support that encourage users to move on to the next task.

Five Steps Through The Process

Now that you have a better understanding of your users, your product, and objectives to keep in mind as you develop a great strategy, here are five specific steps of the user journey to implement as you design your onboarding process.

1. Signup

The user is already aware of your product through marketing content, ad targeting, or a recommendation from a trusted source, but they want a bit more assurance before paying full price. Signing up for a free trial or freemium option is their first interaction with your brand, so make sure the process is simple, coherent, and efficient.

This is a great stage to learn more about a user since they can give you the information you want as they sign up. Ask necessary questions like their name and email address, as well as survey questions whose answers help you differentiate which segment the user belongs to. You can find out what their goals are to determine the best ways to guide them through the onboarding process. Limit these prompts to a handful of the most helpful–you don’t want to frustrate them at the starting line. 

2. Introductory Email

You have the basics of their information–now it’s time to introduce your company. Sending a welcome email not only starts the channel of communication, it also sets a standard for this new relationship. In this introductory message, your company has the opportunity to show the value of what users are getting with tactics like social proof and useful resources for beginners. Links to relevant content, your company’s blog page or YouTube channel, for instance, can kickstart their motivation if they already have some support available. This message can also include a link to the login page, inform users of what to expect next, and let them know if there are any further actions they need to take in order to get started.

Tracking the usage of these helpful hints is another great way to further analyze why they’ve signed up. It highlights which resources are the most popular, and which are underutilized and might need to be repurposed or omitted from the first email altogether.

Emails sent after this first one belong to the welcome sequence, and include more content, demonstrations, and testimonials to help users learn more about the product and the company. This drip campaign contains concise, regular messaging sent throughout the first week or so after signup. The timing is meant to be steady enough for users to predict contact from you, keep them engaged, and motivate them to use the software. 

Info dumping is never a great practice–you don’t want to bury them in an avalanche. Instead, offer pieces of the puzzle when necessary. There are two effective ways to go about this: by sending behavior-based emails as certain features in the trial are being used, or with a steady flow of resources throughout the length of the trial period. You’re offering just enough information about a feature to entice them to go use it.

Beyond this sequence, it’s important to also send checkup emails that can re-engage a lapsed account and humanize the existing relationship. It’s a way to strengthen the customer success strategy, and shows users that your company cares about their experience.

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3. Login and User Interface

Now that they have a clear starting point, the user can log in and get the ball rolling. This landing page doesn’t have to be blank until they start using the software; in fact, it’s better to reiterate the value your product offers and some examples of its uses, as well as a CTA. What do you want the user to do first? Make these steps easy to follow with simplified information that motivates continued engagement as they begin to walk through the trial.

If the software requires more information to be entered to streamline the learning process, or needs to integrate with other apps, data import is a good first step after login. Show the results they receive when they provide this data with examples and editable dummy info, and how this input benefits their user interface experience. This process can be made easier with an option to autofill the information they provided on the startup page, or link with other relevant platforms where they already have an account, such as a social media profile. 

4. Tutorials and Other Helpful Documents

Let the learning begin! Incorporating tools to guide their journey will keep them on the right path and move them towards their goal faster. These tools can include things like:

  • Buttons or callout popups with helpful hints that appear alongside features as they are used
  • A separate in-app page with additional tutorial information like demonstrational videos, infographics, and step-by-step guides
  • A display of their progress, like a checklist or a progress bar, to show where they are in the learning process and where they’re headed

These tools should be easy to opt out of if the user decides they don’t want to use them, but also easy to find if they get stuck and change their mind.

Additionally, supplying extra documentation is worth the time it takes to accumulate all of that info. It gives users the option to learn more on their own, and in the format that works best for them. Maybe YouTube demonstrations work better for a user’s learning retention than blog content. Accommodating their needs with a variety of options shows the level of support your company provides.

5. Notifications

In-app notifications are an important communication connection as they bolster motivation and re-engagement with the product. The messaging they contain should be useful as well as encouraging, for example:

  • Reminders to take advantage of popular features
  • Helpful hints or tricks that are currently being underutilized
  • Progress highlights and congratulatory remarks
  • Reminders of any action the user still needs to take

These notifications shouldn’t be sent too often. Test the amount of messages and the usefulness of their content to find the sweet spot between annoyance and being forgotten. And, like pop-up tutorial hints, give users the chance to opt out of receiving notifications or the ability to adjust their frequency.

Motivation Techniques To Decrease TTV

You know what they say–you can lead a horse to water, but you can’t make it drink. Arranging all of the bells, whistles, and instructions on how to use them will only get you so far. Consumers often need a little help when building a habit, which is exactly what they’re doing when they return to your product and attempt to use it. This is especially true with something like a free trial, because the stakes are low if they choose to abandon the process when they no longer have the drive to learn about it anymore. 

Decreasing TTV, or Time-To-Value, entails shortening the amount of time it takes for a user to appreciate the value of what your product has to offer. This length of time could determine whether or not a user becomes a happy customer, or walks away frustrated.

That might sound like an uncontrollable variable, but there is a worthwhile technique you can use to motivate your audience that doesn’t just follow the blueprint of your onboarding strategy, it also happens naturally, so the users end up motivating themselves.

But first, let’s discuss the basics of starting a new habit and how to make it stick.

About Habit Building

There is a real psychological tactic behind rewiring the brain to learn something new, especially when it comes to developing a habit. Everyone has a different method for getting a routine to become second nature, so in order to incorporate this approach into your onboarding strategy, it will probably take some time to test what methods work best for your different user segments. 

Here are three of the most basic ways to build a new habit:

Start Small

Most people have the initial motivation to jump right in, but ask too much of themselves from the beginning. They then lose interest quickly when the necessary steps turn out to be more difficult than they anticipated. Starting off a new habit should be easy. Make the tasks simple enough to generate a feeling of accomplishment, while keeping them small enough to be too easy to avoid.

Increase the Habit

Once you’ve created a solid starting point, it’s much easier to build off of that stable base and increase the habit to a level which shows real results. Better when taken gradually and with escalation, this step strengthens the tasks and enables them to become more complex and interesting. Expanding on the rate of the habit-building period feeds directly back into the motivation to pursue the process, as it shows progress in greater increments towards the intended goal. 

Consistency

Doing a little bit every day is better than nothing. Maintaining a routine builds the habit faster through repetition, and becomes more of a normal practice when you’re chipping away at it daily. Consistency also provides a sense of perspective–with enough distance between yourself and your starting point, the goal seems that much closer.

How to Maintain Momentum

Now, let’s talk about the techniques you can use to push your customers towards success. Motivation can be a difficult thing to instill in users when they’re building the (hopefully) daily habit of logging in and figuring out how to use your product. 

The promise of benefits might not be enough, so when it seems like they’re losing interest and disengaging, designing something like an “aha” moment into your onboarding strategy will get users to see the value of your product for themselves without the motivation coming across as pushy or invasive.

The “Aha” or “Wow” Moment

Essentially, this is an organic moment for the user when they finally understand the value of your product. While developing the onboarding journey, it’s a motivational step you can incorporate that will inspire the user to progress from the free trial to a paid subscription, with the ultimate goal of retaining this customer successfully. The tricky part is designing it for users to encounter on their own, as this moment has a more lasting effect when it occurs naturally.

The strategy actually works best with multiple smaller breakthrough moments that, to the user, seem to happen spontaneously throughout their experience before they get to their big “aha” moment. These smaller steps are easy for them to accomplish, add encouragement and confidence by broadening their knowledge base, and reinforce each other to lead users closer to their goal. It also shortens TTV because they’re seeing results sooner, and therefore reduces the risk of churn.

Organic learning makes for better memory retention. When a student solves a problem by working through it on their own, they don’t just learn the solution, they also learn how to problem-solve more efficiently. Onboarded users are the same way. With every simple task set to be completed, there’s an opportunity for allowing them to understand value. This is most effective in a low-pressure environment, meaning they aren’t afraid to fail and try again, because the right support systems are in place to help them succeed. Through consistent practice, encouragement, and a strategy designed for success, users will remember what they’ve learned throughout the process and come to their own “aha” conclusion.

To achieve this, the user’s journey must be streamlined and monitored in such a way that guides them down the right path at the right time. Encourage them to use your product as opposed to simply watching every tutorial video. Keep obstacles low enough to overcome, which might mean breaking down large tasks into bite-sized pieces or mitigating distractions like superfluous information. Even the length of the trial period can affect TTV–shorten the process to take enough time for users to test all the features and decide quickly if they want to pay for a subscription.

Use Data

Understanding the reasons for a customer’s success or failure helps with designing an effective strategy. Did they complete the onboarding process? Are they using the resources you’ve provided? Is there continuing engagement with your product after they sign up? The answers to these questions will help create a path to user success.

Data can be gathered with direct feedback, like a survey or questionnaire, to make connections between the successful behaviors with context straight from the source. It allows you to learn what their “aha” moment was, and utilize this information for future users with a similar onboarding journey.

How To Monitor Onboarding Metrics

Introducing consumers to your product is an ongoing process that requires constant testing. With so many moving parts in the onboarding process and so much data to collect, this might seem overwhelming. Here are some of the important metrics to look out for when finessing your strategy.

Conversion Rates

What percentage of users are finishing the onboarding process and moving from the free trial to a paid subscription? Is there a pattern within your segment groups? The rate of user conversion can tell you if the onboarding strategy you’ve developed is working or not. Notice any similarities between users who churn, as this will illuminate any bumps in the road that need to be adjusted for a better retention success rate.

Customer Engagement

By measuring login activity, i.e. how often users log in and how long they use the app at a time, you will see who is an active user, who has abandoned the process entirely, and who needs a little push in the right direction. It should also be noted where they are in the process and if there’s a correlation between other users at a similar level of activity, which highlights a step in the process that may have been confusing or frustrating, causing a reduced rate of customer engagement.

You can also measure the usage of an app’s features, including how many are being engaged with and which ones get the most use. You’ll then have a better idea of your most popular features and which ones are valued by different segment groups, and if users are taking adequate advantage of them. Analyzing feature usage tells you which elements to promote, which segments will utilize them the most, and when to encourage engagement with these features on their user timeline.

Churn Rates

The loss of a customer is never something a company wants to see happen, but when it does, this is valuable data that can be used to your strategy’s advantage. Knowing when and why users churn will give you a better idea of how to develop proactive metrics that lower these rates. 

There are three different types of churn:

  • Positive: customer achieved their goal and no longer needs your service
  • Active: users opting out of your service
  • Passive: lapsed accounts

Positive churn, as its name suggests, is a good thing–it means you’ve done your job and the customer left satisfied and thinks highly of your brand. This type of churn can also produce a high NPS, or Net Promoter Score, which means not only did they enjoy their relationship with your company, they’re also willing to recommend it to others. Promotion by word-of-mouth costs you nothing, and the new customers you’ll gain are statistically more likely to have a high LTV.

Active churn occurs when the user decides the product wasn’t a good fit for them, and cancels their subscription. Tactics like adding incentives, increasing awareness of features and support, and even increasing value can change their mind and turn them around. After all, they may only have chosen to walk away because a pivotal piece of the process was missing, and misguided them. Feedback from this group is essential in order to upgrade the onboarding design. Even if they fully commit to unsubscribing, knowing why this occurred will help you address the problem.

Passive churn is an easier group to salvage, because they haven’t decided to walk away just yet, but they aren’t engaging with your product either. Look at the data; things like login activity and feature usage might show you where they decided to pause, or it could be payment related if their billing information needs updating. In any case, encouraging these users to re-engage means presenting the value of your product in a more effective way, or offering supportive reminders to help them fully utilize a trial’s features.

To reduce the risk of any kind of churn, keep an eye out for warning signs. Disengagement looks like infrequent logins, popular features being underutilized, and a refusal to contact the support team. Again, the timing of these actions says a lot, especially if there is a pattern and users are discontinuing around the same step during onboarding. There may also be a pattern within customer segments, which tells you that the path you’ve made for them is leading away from their goal and needs reworking, or they need additional motivation and support at a specific moment for re-engagement.

Cohort Grouping 

Cohort analysis is another way to monitor user behavior. Unlike segmentation which groups similar user profiles together, cohorts are groups based on a user’s signup date. This calculates users’ evolution over their lifetime with your business and allows you to monitor their onboarding progress. 

This analysis lets you know where they are on the timeline for successful onboarding to meet their goals, and whether or not they’re likely to convert to a paying customer. You can compare cohorts to determine any trends with app usage, as well as notice any patterns in user behavior. A proactive approach to reduce churn rate through a streamlined onboarding experience will ultimately optimize retention rate.

The onboarding process should be designed to reduce churn rates over time. After you have an awareness of the moments that cause users to walk away, you can pinpoint those areas to strengthen them as a proactive tactic. Are there elements in a sequence that aren’t being used? Are they even necessary, or does the delivery just need to be improved? With a more solid strategy in place, it starts the beginning of a user’s engagement with your product on the best terms, which encourages customer success. And, as always, an ongoing testing process optimizes the use of the churn data you collect.

Final Checklist

The process of onboarding users is one of the most beneficial strategies towards customer retention and business profit. When handled correctly, it means both you and your customers flourish. For your initial design strategy, be sure to incorporate each of the following points:

  • Research your user personas, segments, and their goals
  • Identify the complexities of your software and its features
  • Learn what motivates your users and use them in your metrics
  • Provide options for further information and tutorials
  • Develop each step of the onboarding experience with user success in mind
  • Ask for feedback
  • Discover and implement the “aha” moments
  • Monitor the various metrics and test new strategies

Starting a great relationship with customers requires careful consideration, nurturing, and refinement. By keeping these tactics in mind, you’ll develop a strong onboarding strategy that ensures the success of your customers as well as your company.

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