How to Track Product Adoption Metrics: Tutorial and Examples

Key Metrics and Their Calculation for Tracking Product Adoption 

To understand your product’s standing, it is vital to track your customer’s activity in a variety of ways. Here are some majorly used metrics and the methods to calculate them. We will throw you a couple of fun facts here and there showing you the importance of tracking product adoption metrics 

1. Product Adoption Rate

Coming to the elephant in the room, product adoption rate is nothing but the percentage of the number of people who adopted your product out of the total number of people who were exposed to it. The product adoption rate formula would be,  

Product Adoption Rate = (Total Signups or Users / New Active Users) × 100

Now, who must be the most impacted by product adoption rates? This metric directly impacts businesses that provide consumer-based services such as e-commerce, fintech and super apps. Therefore it is important to always keep an eye on how customers are interacting with your product.

Fun Fact: A study by Wyzowl discovered that over 90% of customers felt that companies could improve their onboarding experience. Eight out of ten users tend to delete an app if they don’t receive a smooth onboarding experience.

2. Customer Retention Rate

While bringing in new customers is vital, keeping your existing base intact is equally or even more important. Failure to do so can severely impact your company. In order to avoid this, it is important to track customer retention rates. The formula for customer retention rate is as follows. 

Customer Retention Rate = (Customers at Start of Period/Customers at End of Period − New Customers Acquired ) ×100

Mobile apps are known to have terrible retention rates. Our expert blog on industry-based customer retention provides you with strategies to maximize your app retention rates.

3. Customer Churn Rate

Along with retaining customers, one must see the number of customers who have left your product. A lower churn rate is always preferred, indicating a product with a loyal customer base. The formula for customer churn rate is:

Churn Rate= (Number of Customers Lost / Total Customers at the Start of the Period)

​ ×100

4. Activation Rate

The amount of customers who take an important action during the onboarding process indicates the product’s activation rate. This action can be as small as even setting up one’s profile in the application. The formula for activation rate is:

Activation Rate = (Activated Users / Total Signups) × 100

5. Time to Value

First impressions are indeed the best impressions. The quicker we see value in something, the longer we stay. Time to value is a metric that captures this basic human nature. 

It is crucial for a product to be quickly valuable to its users in order to churn out maximum engagements. The formula for time to value is:

Time to Value = First Value-Driven Action / Start of Engagement

Fun Fact: As per HubSpot’s report, around 55% of customers see the value of a product in their first week of use. This means you got to work on that first impression pretty well.

6. Average Session Duration

Just as the name indicates, this metric shows the average time a user spends on your product. The longer the time spent, the more engagement there is. The formula for average session is:

Average Session Duration = Total Duration of All Sessions / Number of Sessions 

7. Usage Frequency

The frequency at which a customer engages with your product over a period of time is the product’s usage frequency. Although this metric varies from industry to industry, it is still a major indicator of your app’s engagement. The formula for usage frequency would be:

Usage Frequency = Total Interactions or Sessions / Number of Users in a Specific Period\

User frequency helps brands in the gaming, fintech, and health-tech market identify user engagements in the following ways:

• Gaming: Having high usage frequency for a gaming app reveals the possibility of longer average session durations and monetization. By maintaining excitement, these games tend to keep higher customer retention rates and engagements.

• Fintech: Frequent engagement with banking and other financial services apps indicates the user’s dependency on the app for activities such as managing transactions, viewing balances, etc. Additionally, higher usage frequency usually reflects compatibility and efficiency.

• Health-tech: Fitness is all about discipline and consistency. So, app usage frequency is essential to determining how engaging and successful your product is. High usage frequency indicates the app’s potential for long-term usage and premium service conversions.

8. Product Stickiness

While we just discussed the usage frequency above, what influences the user to visit your product frequently is its stickiness. The higher the product stickiness, the more the usage frequency which in turn means higher engagement and return on investment.

Product stickiness is calculated with two factors in hand - Daily Active Users (DAU) and Monthly Active Users (MAU). The formula for product stickiness is as follows:

Product Stickiness = (DAU / MAU) × 100

9. Feature Adoption Rate

As direct as the name can be, the feature adoption rate shows the percentage of users who have adopted a new feature. This metric basically reflects whether or not a particular new feature introduced in your product is a success. The formula for the feature adoption rate is:

Feature Adoption Rate = (Number of Users Who Use the Feature / Total Number of Users) × 100

10. Net Promoter Score

This is a simple rating system based on the probability of the user recommending your product to their friends and family. From the score obtained, you can measure your product’s user experience. The net promoter score can range from -100 to 100, and the higher the score, the better your product engagement.

Net Promoter Score = %Promoters − %Detractors

11. Customer Satisfaction Score

A rating system similar to the net promoter score; however, this time, the question lies around the personal satisfaction score of the customer. Ranging from 1 to 5, of which 1 is the least satisfied and 5 is the most satisfied; this metric is necessary to understand where your product stands in relation to user satisfaction. The formula for customer satisfaction score is:

CSAT= (Number of Satisfied Customers [4 and 5 ratings] / Total Number of Responses​)

 × 100

Fun Fact:  8 in 10 users are ready to pay you more for a better customer experience, as per Capgemini.

12. Customer Lifetime Value

This metric is tracked to show how much value a customer is willing to pay for the product during the course of the product usage entirely. Customer lifetime value helps companies understand the revenue they can generate from a long term loyal customer

base, on which they can strategize their marketing plans and expenditures. The formula for this metric would be:

CLV = (Average Purchase Value × Average Purchase Frequency) × Average Customer Lifespan

Taking all these metrics into account, we at Plotline, with our expert services, ensure that your application is transformed into a Super App. 

Practical Examples of Product Adoption Tracking

1. E-commerce App: Improving Adoption Through In-App Nudges and Campaigns

Platforms like Amazon depend heavily on customer engagements to provide a seamless shopping experience. Such apps track metrics, starting from activation rate and time to

value to more specific ones, such as cart additions and searches, to evaluate the effectiveness of a certain campaign.

• Action: To drive awareness, the business can inculcate in-app nudges to promote certain campaigns, such as Amazon’s Prime Day.
• Adoption metric: Tracking the usage frequency and conversion rate can help the company evaluate the success of these particular campaigns.
• Example: With employment of in-app nudges, Amazon during their Prime Day 2019 campaign was able to increase their conversion rates and sell over 175 million items worldwide.

2. Streaming Services: Driving Adoption to Personalization

What's the first application that comes to mind when you feel like listening to your new favorite song? Spotify, right? Entertainment platforms have adopted gamification to track progress, which has promoted more user engagement.

• Action: To provide rewards such as badges, personalized playlists, and points after a certain amount of time is spent streaming.
• Adoption metric: By tracking time to value, average session duration, and usage frequency, one can assess the effectiveness of a specific playlist created for the user.‍
• Example: By 2021, Spotify saw a 461% increase in tweets mentioning its yearly Spotify Wrapped campaign and a 131% increment in its overall social media engagement, driving more customers to convert to its premium model.

3. Fintech: Driving Adoption Through Seamless Feature Adoptions

In today’s fast-paced world, payment is all about convenience and efficiency. Fintech Apps such as Jar ensure they keep that word by focusing on introducing their essential features to their users right from the onboarding process.

• Action: Introducing spotlights to guide the user to engage with the app’s newly introduced features.
• Adoption Metric: Taking the feature adoption rate assess the efficiency of the tooltips.‍
• Example: By using spotlights and animations to save actions, Jar saw a 30% increase in user transaction completion rate.

4. Gaming Industry: Increasing Engagement Through Event Days

Nothing can get our adrenaline up like an event day of our favorite game. Games like Pokemon Go use weekly or monthly events to encourage further engagement and retention.

On event days, Niantic Labs offers exclusive Pokemon spawns, limited rewards, and challenges. Players tend to spend money to get their limited edition packs and tickets to

participate in exclusive raids and challenges, making the event day a major mode of revenue for the developer.

• Action: By leveraging monthly, weekly event challenges and daily ladders with in-add
• Adoption Metric: Tracking customer lifetime value and feature adoption rate will give an idea about the success of the event day. 
• Example: A report by Niantic Labs said that Pokemon Go saw an increase in the number of daily active users by around 35% during event days.

5. Healthtech: Improving User Adherence Through Push Notifications

There are days when you don’t feel like getting out of bed. This is when, just like your motivated gym partner, the fitness app such as Fitbit comes into play. By notifying you of those diet recommendations and important stretching exercises on your off days, your app ensures your health is up to the mark.

• Action: To adopt push notifications as a reminder to record their diet, meals, and workout sessions.
• Adoption Metric: The app can determine the efficacy of the notification by considering metrics such as usage frequency. 
• Example: By integrating personalized notifications into their app, Fitbit saw a 50% increase in daily activities.

Wrapping Up

‍In the end, it is about picking and choosing the right product adoption metrics based on your industry and customer base. This can include considering factors such as the people who use your product, the time they spend, and what features they use and ignore.

Moreover, it is important to understand that engagements are what drive a business. With our state-of-the-art widgets, in-app nudges, and gamification, Plotline offers you the best mobile feature adoption elements to boost your user engagement and retention rates. 

‍Book a demo if you are looking to optimize your app growth!