How Product Adoption Drives Retention

Discover the crucial link between product adoption and customer retention. Dive into strategies that drive loyalty, from onboarding nuances to the evolving roles of sales teams, and harness the power of SaaS growth with FunnelStory.

Carson Swan

By Carson Swan

Oct 10, 2023 7 min read

In today's hyper-competitive SaaS landscape, one term reverberates louder than most: retention. Every VP of Sales or Product knows that maintaining a loyal customer base isn't just good business; it's essential for sustainable growth. But what's the secret sauce to achieving high retention rates? Simple, driving product adoption of the right features with the right customers on day one. 

The concept is simple yet profound. If users genuinely find value in specific features of a product, they're more likely to integrate it into their daily workflows, cementing their allegiance to your product. This article will dive deep into the intricate web of product adoption, shedding light on how, when harnessed effectively, it becomes the cornerstone of robust retention strategies. So, whether you're new to driving product adoption or not, this article promises to chart a path to retention excellence through the lens of product adoption practices.

The Paramount Importance of Retention

The age-old business adage, "It costs more to attract a new customer than to retain an existing one," has never been truer than in today's SaaS ecosystem. Acquiring a new customer entails hefty marketing expenditures, sales efforts, and onboarding processes. In contrast, nurturing an existing relationship is often just about enhancing the user experience and ensuring continued value delivery.

But what happens when companies underestimate the significance of retention? Look no further than the recent macroeconomic shifts. In the summer of 2022, a surge in interest rates caught many tech companies off guard. Those who had invested heavily in acquisition but skimmed on retention found themselves in troubled waters, leading to downsizing, re-strategizing, and other austerity measures.

Moreover, as highlighted in our article The Problem with Product Trials and How to Improve Yours, effective product trials can be pivotal in ensuring long-term commitment from users from day 1. A failed self-service experience impedes acquisition and can impact the retention of existing customers struggling to find value in your product. 

While acquisition is the gateway to growth, retention remains the bedrock of sustainable success. The balance between the two is delicate, and the scale should always tipped toward activities that fuel retention.

Unlocking Retention Through Product Adoption

Product adoption isn't merely about users engaging with a platform; it's about harnessing the right features that resonate with your customers' needs and pain points. When users consistently interact with these pivotal features, it naturally creates a heightened sense of value, fostering a stronger bond between the user and the product - a dependency, if you will. 

To truly grasp which features are retention magnets, businesses must delve deep into their existing product usage data. A thorough analysis can unveil which aspects of your product are casually tied to retentive behaviors - what you might call your ‘high-value actions’ (Note: these actions should become the foundation of your product and trial experience). 

Our previous insights on How to Forecast Your PLS Strategy touch upon the importance of predictive analysis in the product-led growth paradigm. Similarly, forecasting which features will enhance user retention is a strategic move. Therefore, prioritizing product development resources on updates and new features that provide maximum value is essential. 

When you treat product adoption as the journey, retention becomes the destination. Ensuring users discover, use, and adopt the right features is the roadmap to reaching that destination successfully.

Decoding the Adoption Funnel

Every user's journey through a product can be visualized as a progression through an 'adoption funnel.' This funnel depicts stages, from initial interaction to deep engagement with key features (what we at FunnelStory call conditions). Understanding this progression is akin to deciphering the secret code of user behavior, offering insights into areas of improvement and opportunities to nudge customers.

However, a one-size-fits-all approach rarely works. Different users have unique needs, pain points, and goals. Segmentation becomes indispensable here. By categorizing users based on specific criteria—be it their industry, role, or behavioral traits—businesses can offer more personalized, relevant experiences.

Yet, more than merely segmentation is needed. Advanced analytic tooling is paramount in Mastering Product Analytics with Your PLS Strategy. Modern Product-led Sales tools offer visual representations of user interactions, highlight bottlenecks, and reveal the least frictive paths. Such insights (answers if you will) enable businesses to refine their strategies, ensuring smoother transitions and enhanced user engagement through the adoption funnel.

Onboarding: The First Impression Counts

Onboarding is akin to a product's first handshake with the user—a gesture setting the tone for the relationship ahead. A seamless and intuitive onboarding process not only simplifies the initial interaction but also fosters a sense of trust and reliability in the user's mind. 

Remember, first impressions are often lasting ones. A convoluted or lengthy onboarding can deter users, even if the subsequent product experience is impeccable. Conversely, an efficient and clear onboarding process can act as a buffer, offering users some leeway as they familiarize themselves with the more intricate features of a product.

In Reducing Product Onboarding Times, we delved into strategies to expedite the onboarding process without compromising its quality. It's essential to strike a balance—ensuring users grasp the product's value proposition quickly while giving them the tools and knowledge to navigate it easily.

A well-orchestrated onboarding process is a precursor to retention. It captivates users, ensuring they're on board and on course for a long and fruitful journey with your product. We'd argue that this is retention's make-it-or-break-it moment.

Supporting Customers Throughout Their Journey

The journey with a product doesn't conclude post-purchase or post-onboarding; in many ways, it's always the beginning. Retention hinges on continuous, tailored support catering 24/7, 365.

For self-serve customers, education is paramount. Since these users are largely exploring on their own, they rely on resources like tutorials, FAQs, and community forums. Providing clear, step-by-step guidance through video demonstrations or interactive modules can empower them to navigate challenges independently.

In contrast, a sales-led process demands a balance of self-serve content and timely intervention. Recognizing when a user might face difficulty and proactively reaching out can make all the difference. This resolves issues and instills a sense of being valued and heard when the customers need it vs. a more intrusive or random approach.

Moreover, every product feature, especially those pivotal for retention, should be accompanied by clearly articulating its value (not just its function). For a feature to be useful, users must perceive its usefulness. Remember, customers buy value, not features. 

Blurring Lines: Pre-sales and Post-sales Convergence

Traditionally speaking, the realms of pre-sales and post-sales are distinct, each with its set of defined responsibilities and teams. Pre-sales focuses on attracting and securing customers, while post-sales focuses on ensuring customer satisfaction and continued engagement. But these lines are becoming increasingly blurred in today's dynamic business landscape - especially as companies pursue a modern GTM model that actively challenges this passing of the baton. 

Modern sales teams are now realizing that the sale isn't the endgame. Ensuring product adoption and consistent usage is just as crucial. This shift signifies that sales teams are not just revenue generators but also customer relationships and retention custodians.

By blurring the lines between pre-sales and post-sales, companies can ensure a more cohesive and holistic approach to customer experience. This synergy ensures that customers feel supported, valued, and understood from their initial interaction to their ongoing relationship with the product. But don’t just take our word for it, read or listen to our conversation with Alok Agrawal, VP of Solution Engineering at Rubrik. 


In the rapidly evolving landscape of SaaS, the focus has significantly shifted from merely acquiring customers to retaining them - and as we laid out, it's for good reason. Throughout this article, we've delved into the intrinsic connection between product adoption and customer retention, demonstrating that true growth intertwines these two facets.

Product adoption isn't just a checkbox in the user's journey, especially of the right features. It's the backbone of sustainable business growth, ensuring customers don't merely use a product but find genuine value. By analyzing business models, perfecting onboarding processes, and supporting customers throughout their journey, businesses can unlock the true potential of retention.

As we enter an era where the lines between pre-sales and post-sales blur, the responsibility for retention is shared, echoing the sentiment that a holistic business approach is the way forward.

Are you looking to enhance your product's adoption rates and supercharge your retention strategies? Explore how FunnelStory can revolutionize your approach and drive unparalleled engagement. Dive in today!