Your SaaS product should be like honey.
No, Winnie the Pooh isn’t writing this.
We’re talking about product stickiness!
It’s a measure of how often your users just can’t pull themselves away from your product. Essentially, this ratio measures how ‘sticky’ your product is.
But what is the stickiness ratio, and how do you improve it?
There’s a question that sticks in the minds of all SaaS founders!
We’ll explore what product stickiness is in the SaaS industry, how to calculate it, why it’s an important metric, and how you can increase product stickiness.
You’ll also discover what website stickiness is and an easy, hassle-free way to grow and scale organic traffic to your website (through Startup Voyager).
Further Reading
- Explore our expert guide on Lead Velocity Rate (P.S: it isn’t the same as Sales Velocity Rate!).
- Get your facts straight about the SaaS Customer Lifetime Value and 2 ways you can use it for business development.
- Become a pro at calculating and evaluating the Rule of 40 in SaaS.
This Article Contains
- What Is Product Stickiness in SaaS?
- How Do You Calculate the Stickiness Ratio?
- What’s the Difference between Stickiness and Retention?
- Why Measure Product Stickiness Ratio?
- How Do You Increase Product Stickiness?
- What Is the Ideal Stickiness Rate?
- What Is Website Stickiness, and How to Improve It?
What Is Product Stickiness in SaaS?
Product stickiness is an engagement metric showing how well customers adopt and love a product — thereby increasing your customer lifetime value.
The concept — made popular by Facebook as a way to track customer retention — captures how frequently customers or users use or return to your product.
But wait – what are user stickiness and app stickiness? 🧐
User stickiness describes loyalty and the extent to which users find value in a product or service. This leads them to become loyal and engaged customers who choose to continue using it.
App stickiness refers to the ability of a mobile app to keep users engaged and returning to the app over time.
You can also track two other product stickiness metrics:
- Open Rate: This metric measures how many users open a specific message (like email or push notification). It helps you understand user engagement and improve your messaging to increase stickiness.
- Lness: This metric shows you the number of days a customer visits your website or product within a certain period.
Who Needs to Use a Stickiness Ratio?
It’s one of the metrics you can use to identify if you have a product market fit or a product people in an intended market want to buy.
B2C and B2B companies in the SaaS space will best benefit from calculating product stickiness.
How Do You Calculate the Stickiness Ratio?
Let’s break it down:
You need two main metrics to calculate the stickiness ratio (or DAU/MAU ratio):
- Daily Active Users (DAU): Daily active user is a measure of the total number of people who engage with your product daily.
- Monthly Active Users (MAU): Monthly active user is a measure of the total number of unique users interacting with your product monthly.
So, the stickiness or DAU/MAU ratio calculation is:
Stickiness Ratio = Daily Active Users / Monthly Active Users
How Does Stickiness Ratio Look In Action?
Let’s say your website had 10,000 unique users every month, out of which 2,000 were daily active users.
The calculation would be 2,000/ 10,000, leaving you with a product stickiness ratio of 0.2.
Need this figure as a percentage?
Just multiply it by 100 to arrive at 20%.
This means that 0.2 or 20% of customers use your product at least once a month and also use it at least once a day.
In order to improve this number, you can add more in-app nudges encouraging users to explore the tool further and keep revisiting the tool regularly.
Because remember, the more often they use the tool, the more indispensable it is for them!
However, remember that an “active user” will vary depending on your business.
This active user can be someone who logs into the product, adds a team member, finishes a task, and more.
For a user to be considered active, your business should check if they complete the most crucial step in every session.
How Often Should You Measure Product Stickiness?
Since the figures for DAU and MAU will change every day, you can calculate stickiness daily. It’s like a moving average of user retention!
Wondering where you can get all the data to calculate the stickiness ratio?
Use tools like Google Analytics, Amplitude, Mixpanel, and Segment.
What Should You Bear in Mind to Collect Accurate Data?
Remember these sticky tips when collecting accurate data:
- Identify what ‘active’ means for your SaaS product. This can vary from each business model. For instance, Slack looks at the number of messages sent through the chat, while Facebook tracks the number of photos posted or friend requests.
- Don’t include new subscribers or users in the DAU figure. Doing so can lead to an inflated figure and an inaccurate outlook of stickiness. Define what DAU means for your business and set the parameters.
Now that you understand how to calculate the stickiness ratio, let’s explore what role it plays in retention.
What’s the Difference between Stickiness and Retention?
A product’s retention rate tells you how much customer loyalty is — i.e how many customers return monthly or annually. This is directly impacted by re-engagement practices (e.g., email notifications).
On the other hand, stickiness is how valuable your product is to a customer.
A SaaS product with sticky customers or users usually has a good retention rate and low churn rate.
Each SaaS company will benefit from tracking the product stickiness ratio.
Let’s take a closer look at why:
Why Measure Product Stickiness Ratio
Wondering why stickiness is an important metric?
Check out how every team in a SaaS company can benefit from learning product stickiness:
- Customer success team: Measuring stickiness can help the team understand how engaged customers are with the product and what features they find most valuable. This can enable them to identify opportunities to increase customer engagement and product adoption and reduce churn.
- Product team: The stickiness metric can help the product team identify which features are driving engagement and which are not. This can enable the product manager and team to prioritize product development efforts and make data-driven decisions about feature adoption investments.
- Sales and Marketing teams: Stickiness can help the sales and marketing team to understand the product’s value and identify customer pain points and use cases. This can enable the team to create targeted messaging that resonates with customers and highlight the unique value proposition of the product. For ex: email campaigns, push notifications, and special offers.
Now that we’ve covered why measuring product stickiness is important for different teams, let’s discuss the good stuff — how to actually increase it!
After all, it’s not enough to know your users are sticking around. You want to keep them engaged and excited about your product.
So let’s explore some strategies to boost stickiness and get your customers coming back for more!
How Do You Increase Product Stickiness?
Let’s find out how you can achieve customer loyalty, enhance product adoption, and make your product sticky:
1. Make the Onboarding User Experience Pleasant
2. Keep it Simple
3. Collect and Analyze Product Usage Data
4. Ask for Feedback through Surveys
5. Leverage Power Users
6. Upsell and Cross-Sell
7. Provide Real-Time Support
1. Make the Onboarding User Experience Pleasant
Make the user’s introduction to your product smooth and easy to understand.
Try some of these tips to enhance your onboarding process:
- Streamline Sign-Up: Simplify the sign-up process to create a smooth onboarding experience for a new user. Avoid asking for too many personal details to reduce friction.
- Use a Personalized Welcome Screen: Make a good first impression for a new user with a simple video message about your product or using their name in your greeting. Here, you can gather data about how they plan on using the product and customize their experience accordingly.
- Help Users Understand Your Product’s Value Quickly: Ensure users understand the product’s value quickly by guiding them to their “Aha!” moment. Try adding a step-by-step tutorial, interactive walkthroughs, or social media posts to help them discover important features and unlock different use cases.
- Use Contextual In-App Messaging: Send the user in-app nudges in the form of announcement bars, modals, and tool tips that address and drive the user’s level of engagement, like in a mobile game.
- Educate Users about New Features: Use in-app feature adoption announcements to introduce new elements to the engaged user. Personalize the message for different user segments to ensure relevance.
2. Keep it Simple
Regardless of whether the product is B2B or B2C, simplicity takes the cake in SaaS. 🎂
The user behavior theory suggests that complex or excessive information can intimidate users. This can cause them to view tasks as burdensome and annoying to complete.
In short, pose your product as a problem-solving platform — not another problem for the user to solve!
3. Collect and Analyze Product Usage Data
Not all successful products are born with high retention rates. They build them over time by working on user feedback.
How?
Product usage data will tell you which features are most popular and which are underutilized.
Most importantly, focus on the rate of onboarding completion — a reliable predictor of future engagement.
Use this information to reprioritize features in the product roadmap — maybe even retire some that have fallen out of favor with your users.
Session length is another useful metric to track, especially for a mobile app. It indicates the duration of user engagement in a single session. By monitoring session length, you can determine which app features are engaging to users and which areas may require improvement.
4. Ask for Feedback through Surveys
Despite its immense value, product usage data is a passive source of user feedback.
To learn more actively, lend your ears 👂 to your users via surveys.
You can ask customers for their thoughts on the onboarding process, their favorite product feature, or even why they decided to cancel their subscription.
Customer satisfaction surveys are ideal to:
- Identify areas of friction and work to eliminate them.
- Equip your customer success teams with knowledge of customer pain points.
- Offer enhanced customer support services.
- Improve your product’s features to increase user engagement.
Besides this, it communicates to the user that you care 💜
5. Leverage Power Users
Power users or customers are highly engaged with the product and can provide some of the most valuable feedback to improve it.
Incentivize an engaged user to continue using the product with:
- Discounts on long-term subscriptions
- Bundled services/add-ons
- Exclusive release of new features
- A more active role in product development
For instance, like Adobe, classify your products and offer them as a bundle. This way, a novice photographer wouldn’t have to pick between Lightroom and Photoshop — they would receive both.
Finally, share their success stories to educate the rest of the user base about innovative use cases of your product.
6. Upsell and Crossell
Expand your monthly recurring revenue by offering additional features or upgrades that complement the user’s existing experience with the product. Make sure that these upsells and cross sells add value and are not simply a way to generate more revenue.
One way to increase conversion from freemium to premium is by offering a good discount to long-time freemium users. Similarly, you can use persuasive messaging to convince customers who are considering downgrading their plan to stick to their current plan.
However, timing is crucial in proposing the right plan. For instance, sending a push notification with an upgrade discount to a user inactive for a month may not yield the expected results.
7. Provide Real-Time Support
The key to great user engagement is building a butter-smooth product that leaves users wanting nothing.
However, if the user feels like this —
— offer them real-time support through live chat or other channels for instant resolution.
This will allow users to feel supported and valued, increasing the likelihood of using the product.
But remember, the longer a customer has to wait for a reply, the higher your customer churn rate can be. 75% of customers expect assistance within five minutes, and a third won’t wait.
We now know how to increase product stickiness. So let’s find out what the ideal stickiness rate looks like.
What Is the Ideal Stickiness Rate?
The ideal stickiness rate is subjective and can vary depending on the specific SaaS business and industry. However, generally, a higher stickiness rate is desirable as it indicates that customers are more engaged with the product and less likely to churn.
A good stickiness rate benchmark is around 20-30%, meaning that 20-30% of users remain active and engaged with the product every day after the initial sign-up period.
In the SaaS industry, the average stickiness rate is 13%. This translates to about four days (or less) of activity per user each month.
Ultimately, the ideal stickiness rate for a SaaS business will depend on factors such as the industry, target audience, and business goals.
What Is Website Stickiness and How to Improve It?
Website stickiness refers to the ability of a website to keep visitors engaged and interested in its content, features, and functionality.
But why do you need a sticky website?
A great website can often be the first contact of a user with your brand. You want it to showcase the best feature of your product and push the visitors to engage with it.
A website with high stickiness will encourage visitors to stay longer, interact with its features, and return frequently.
The stickiness of a website can be measured by analyzing various metrics such as:
- Bounce Rate: This is the percentage of visitors that leave your website without clicking through to another page. A high bounce rate indicates that visitors are not finding what they’re looking for and quickly leaving.
- Time Spent on the Site: This indicates the amount of time visitors spend on your website. The longer visitors stay on your site, the more likely they will engage with your content and become loyal customers.
- Pages per Session: This is the average number of pages a visitor views during a single session on your site. The higher this metric, the more likely visitors will find your content valuable and stay on your site longer.
- Conversion Rate: This is the percentage of website visitors who complete a desired action (think filling out a form or purchasing a plan or subscription). A higher conversion rate shows that visitors find what they’re looking for and are interested enough to take action.
High website stickiness is generally desirable for businesses as it can increase brand awareness, customer engagement, and, ultimately, higher sales and revenue.
So how do you go about improving website stickiness?
- Clear Navigation: Make it easy for visitors to find what they want on your website with clear and concise menu options.
- Valuable Content: Identify your target audience and create high-quality, informative content that speaks directly to their needs and interests.
- Updated Content: Keep your content up-to-date with the latest information in your industry.
- Visitor Engagement: Encourage visitors to participate with interactive features such as polls, surveys, quizzes, and comment sections.
- Reduce Clutter: Simplify your design, use white space effectively, and remove any unnecessary elements distracting from your main message.
- Improve Visibility via SEO: Ultimately, it doesn’t matter how engaging your website is if your potential customers can’t find it in the first place. That’s where search engine optimization and crafting great content come into play.
If you don’t have the internal resources to create unique, valuable, optimized content regularly for your website, consider outsourcing it to an agency like Startup Voyager.
Who is Startup Voyager?
Startup Voyager is a content and SEO agency that helps you create awareness for your website and boost conversations.
What’s more, we have successfully assisted a client in boosting their organic traffic from zero to over 100,000 within a year.
Unlock the Secret to Product Stickiness
Stickiness is far from just a metric. It’s a day-to-day measure of user retention vs churn. For a SaaS CEO, founder, or product manager, stickiness is the ultimate test of relevance and survival.
If you want your product’s stickiness to keep going up and stay there, follow the tips mentioned in this article.
And if you’re ready to supercharge your website’s stickiness with the latest in SEO and content marketing, look no further than Startup Voyager. Our team of specialists will help you skyrocket your organic traffic and take your business to new heights.
What are you waiting for? Contact us today!
