Do You Know What Your Customers Are Doing With Your Application's Feature Set?

Do You Know What Your Customers Are Doing With Your Application’s Feature Set?

SaaS brought two fundamental sea-changes to the software industry. The first was to the profits-realization model, changing from front-loaded profit-taking over to incremental income streams, and now consumption pricing. The second was the capability to monitor, in real time, what was being done by the customers with an application’s feature set. The first is in play throughout the SaaS sector. The second? Largely ignored, and companies and jobs are at risk because of it. Full customer adoption of the features of the application, driving customer retention, is no longer optional; it’s core to survival.

Are you tracking actual adoption?

There are a range of KPI’s in play throughout the various functional departments of a SaaS company. NRR, GRR, Customer Health Scores, — the list is extensive. Some are about attempting to measure Adoption, how many licenses are actually in use per customer, or how much bandwidth is being consumed. But who in your company is being measured on actual value realized by the customer? How is this measurement being done and reported?

I had a brief conversation regarding the questions I’ve asked with a CSM at a SaaS company. They acknowledged that no feature usage tracking was included in their application, so their only access to adoption data was to ask the customers what they were using — which made the CSM feel that the lack made them look stupid. Other than that, the CSM reviewed the contract to see what modules had been licensed by the customer, and chalked that up to “adoption.”

As bad as this appears, it’s unfortunately far from unusual, which leaves me with a heavy feeling when I think of all of the CSMs out there who are trying to do their jobs with both hands tied behind their backs, blindfolded, and hobbled.

Definition: Authentic User Adoption

There is more to adoption management than noting logons. What tasks are the customers actually accomplishing with their usage of your app’s feature set? What are those tasks worth in terms of increased profitability and productivity? How do you know? Which department knows what constitutes the core features of your app and tracks their utilization? I think that Customer Success is the logical place where this should occur, but where is of less importance than that it is being done. Who is keeping their eyes on the ball?

How do you measure adoption in your company? Do you? What does adoption mean to you?

Note that if your application doesn’t inherently have such tracking functionality, you can bolt it on via such apps as Mixpanel or Pendo or others listed in the Customer Success Directory. Are you using any of them? With what effect on your customer retention stats?