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What Is a Product Adoption Rate?

Product adoption rate

In this article, we’ll explore what a product adoption rate is, how product adoption rates are measured, and how to improve product adoption rates.

Product adoption is the process where users become familiar with, learn, and integrate a new product into their workflows.

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For example, an app development firm will want to measure its apps’ product adoption rates, since those rates can offer insight into…

  • The product’s usability
  • The product’s profit and marketplace performance potential
  • Ways to improve adoption and performance

Product adoption is important not only for product developers, but also non-tech businesses, such as companies that adopt new products for internal use.

Improved adoption, after all, implies improvements across a number of other important areas, such as:

  • User engagement
  • Proficiency levels
  • Productivity
  • Product utilization
  • Product ROI

Adoption, in short, has a very large impact on the bottom line of a product and a business.

How Do You Measure Product Adoption Rates?

Product adoption tracks how effectively people onboard, train, and integrate a product into their workflows.

To that end, most measurements focus on areas such as:

  • Utilization. A product is only valuable to the extent that it is utilized. If a SaaS platform is used only sporadically – or if users only make use of some of the product’s features – then that product will only be delivering a portion of its potential value. In other words, true adoption depends in part on how fully users utilize a product.
  • Skills. User skill levels also affect product adoption rates. Since user skills affect product usage, engagement, and value, it is in a product creator’s best interests to help users become proficient and productive. 
  • Engagement and the user experience. Engagement refers to how actively and enthusiastically people use a software program. The more engaged users are, the more they will use a product and the more quickly they will fully adopt it.
  • Productivity and performance. User productivity is also tied to product adoption rates. The more efficiently and quickly users can adopt a product, the more productive they will be. And the more productive users are, the more engaged they will be. 

The better that an organization can understand these areas, the more effectively they can understand product adoption rates.

Common measurements include:

  • Time-to-competency. This metric explores how long it takes users to gain a target level of competency with a product. This metric is crucial in businesses, since productivity and competency directly affect product ROI and organizational performance.
  • Retention versus abandonment. User retention rates describe how many people stay with a product and for how long. Abandonment explores drop-off in user numbers – that is, how and when users abandon a product. These indicators can offer insight into the strengths and weaknesses of product adoption programs.
  • Overall proficiency levels. Overall skill levels describe the general skill levels that users achieve with a product. The more proficient users are, the more productive, engaged, and loyal they will be.
  • Overall productivity levels. Productivity explains the quality and quantity of output. Since productivity affects so many of the other metrics here, from product ROI to user engagement, this is one of the most important indicators to track.

The exact nature of the metrics will depend on the business and its specific aim. 

For instance, an enterprise that adopts new software for internal use will focus on areas such as employee productivity, time-to-competency, proficiency, and so forth. Metrics such as these will, after all, directly impact an organization’s overall performance.

How to Improve Product Adoption Programs

A product adoption program should proactively attempt to improve adoption metrics through a variety of means.

These efforts should revolve around:

  • A product adoption strategy. Strategies should be built around measurable goals that fit with the organization’s overall strategy. A business that wants to adopt a product to enable digital transformation, for instance, should create a strategy that revolves around employee productivity, software ROI, business process performance, and other areas that impact the digital transformation strategy.
  • User training programs. Digital training efforts are designed to improve user proficiency, time-to-competency, productivity, and related metrics. These training efforts should be built to minimize waste – such as irrelevant training material or technical support calls – while also simplifying the user experience.
  • Data-driven optimization. Metrics and KPIs should all be continually tracked and analyzed. Doing so will offer constant real-time insight into the effectiveness of product adoption programs, while also demonstrating which areas need improvement. Over time, optimization can have a very positive impact on those adoption efforts and, in turn, the product’s performance.

Measuring product adoption rates is only useful if businesses actually take action upon that information, make improvements, and continually track their efforts.

For that reason it is important to drive product adoption with a comprehensive plan that is goal-oriented and measurable.

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Digital Adoption Team

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