What It Is

Activation rate shows how close a user or account is to experiencing meaningful value in your product, typically by completing key steps during onboarding.

Why It’s Important

Activation is a critical early indicator of long-term success. Users or accounts that reach full activation are more likely to find ongoing value in your product, reducing the likelihood of churn. Ensuring users quickly reach this stage is essential for maximizing retention.

How It Is Calculated

Activation rate is calculated by dividing the number of key steps completed by the total number of steps required for full activation:

Activation Rate = (Number of Steps Completed/Total Number of Steps)×100

For example, if there are 7 essential steps to full activation and a user has completed 5, their activation rate would be 5/7×100=71%

Signals of Health or Weakness

• Healthy Signal: A high activation rate (e.g., 71%) indicates that users are on track to fully engage with and benefit from the product.

• Weakness Signal: A low activation rate may suggest that users are struggling with onboarding and need more support to avoid dropping off.

Who Uses It and When

• Onboarding Teams: Focus on increasing activation rates to ensure users reach their "Aha!" moment quickly.

• Product Managers: Keep an eye on activation rates to fine-tune the onboarding experience and remove any roadblocks.

• Sales Teams: Use activation data to determine the right moment for outreach, especially in Product Qualified Lead (PQL) processes.

While activation marks the first signs of success, tenure reveals the lasting impact. Once users are fully activated, tracking their tenure helps us understand the journey from early engagement to long-term loyalty. Let’s explore how tenure plays a role in building sustained relationships.