Glossary

Activation

Definition:

Activation refers to the moment a customer successfully uses your product for the purpose it was built for (i.e., achieves your product’s promised value).

 

What is activation in startup?

It’s important not to conflate activation with a customer simply using your product or service for the first time. After all, studies show that 60% of people who sign up for a free trial only use said service once before dropping it. That’s why you must identify a specific event that counts as the point when you know a new customer is committed to using what you’re offering.


What is activation in growth?

Ideally, your startup will grow to where you can no longer commit your attention to individual customer relationships. At that point, your activation rate becomes a crucial KPI to monitor — letting you know whether your customers are receiving your product’s or service’s value.


What is a good activation rate?

While this varies from industry to industry, a good rule of thumb is to have an activation rate between 25%–30%.


How do you measure activation?

First, you need to decide what milestone — or activation event — you’re tracking. Think of this as the aha moment when you can confidently rely on a customer sticking with your product. Once that’s determined, the calculation is easy: 
[No. users who complete the set milestone / Total no. users who signed up] × 100 = Activation rate (%)    


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