In the older world of SaaS where many companies purchased software on a perpetual license, there wasn’t a need to worry about constantly demonstrating or supplemental assistance from a Customer Success Manager (CSM). A company paid the fee and either had to figure out the product themselves or make an internal determination on the cost of switching to a different software license down the line.

Nowadays, SaaS products come with renewable subscriptions and live in a highly competitive market. Companies need to demonstrate incredible value right off the bat, be constantly updating their products to better address customer needs, and provide those customers with exceptional CSMs to guide them along the way. Showing your customers the value of your product early and consistently helps reduce churn and increase renewals and upsell opportunities. But what is value and how do you ensure customers are feeling it? Let’s jump in.

What is Value

In the SaaS space, value can be defined as the benefit that your customer expects to receive from using your product. This benefit or value your customers expect is subjective, meaning each customer will have a different use case and goal your team needs to meet.

For instance, let’s say you have a marketing product and a customer buys your product with the express goal of SEO optimization. It doesn’t matter if you have the best support team, most beautiful UI, or even the most innovative email campaign on the market. If your product isn’t helping that customer with their SEO, they aren’t going to see value.

The faster you can demonstrate value to a customer, the more likely they are to stick around and engage with your product long-term. This idea of quickly demonstrating value is a key part of Customer Success and referred to as Time to Value.

What is Time to Value

Time to Value (TTV) is the time it takes for a customer to realize or extract value from your product. Think of it as “I’d like (customer segment) to achieve (value goal) in (a specific amount of time). The more you learn about your customers and their journey with your product, the more you can tailor the goals and time to achieve them.

There are a few different types of value time frames that can be tracked (more on these later) but the general application of TTV relates to the onboarding process. How quickly a new customer finds value after signing the contract and starting the onboarding process to learn how to use the product.

The type of product will make an impact on the time frame for customers to find value. Some SaaS products are designed to improve day-to-day workflows, so the TTV will ideally be quite low compared to an accounting or tax software that is primarily used on an annual basis and may take a few quarters to have an impact.

TTV will also vary by customer because they are going to have different expectations and goals for your product. It’s important to have a general understanding of how long the average customer takes to find value so that you can learn to speed up the TTV process and adjust to different needs. We’ll break down the importance of tracking TTV in the next section.

Why is it important

Measuring key performance indicators (KPIs) is essential for businesses to understand customer trends and make sure company goals are being met.

For Customer Success, one of the main goals of the onboarding process is to decrease TTV over time so that new customers can find value from your product faster. The truth of SaaS is that losing customers is easy, keeping them is hard.

Once a new customer signs the dotted line, the clock starts ticking to show value and keep them interested in using your product. No matter how big or small a customer is, they want the product they paid for to improve their life and carry out the function they expected it to deliver. Even minor confusion and frustration can lead to churn more quickly these days. If they don’t get value from you, they’re going to start looking to competitors to fill their needs.

This is a common occurrence when customers who were interested enough in the product to learn more and purchase, get left to figure out how to navigate the service alone. Feature heavy products that don’t provide a tailored experience around their customers’ value expectations are going to suffer from low user engagement and low retention. Shortening TTV means customers are getting a faster return on their time, money, and effort so they’re more likely to report a positive customer experience and stay loyal to your product.

Different Types of TTV

Since the type of product, scope of functionality, and various customer priorities can all influence TTV, there are a few different ways to track it.

Time to immediate value

Exactly what the name implies—the customer sees value immediately. Think an online SEO grader where you can input an article and instantly there’s SEO feedback. Because the value ROI is so quick, users are likely to keep returning to the product. Ideally, this repeat interaction leads to interest in more product features and the chance for upsell opportunities.

Time to basic value

This is just the time it takes for a customer to see the bare minimum of value your product provides, but not the large scale product vision. Free tiers often present basic value and a sample of product features that customers can engage with to see value. From there the goal is to entice customers to exploring the larger product vision and purchasing a subscription.

Short time to value

Short time to value is when customers see value quickly, but not immediately. The main issue with short time is that it gives competitors a chance to slide in and demonstrate the same type of value but just a little bit faster. The shorter this time frame, the better.

Long time to value

A long time to value is most common amongst products that have an extensive onboarding process. This could be due to integration and training requirements for new customers to navigate the product, because the customers has a longer sales cycle, or because the product itself is intended to be used on an annual basis. In these cases, it’s important to provide regular touch points with the customer to encourage a relationship and track the value perception of the product.

Time to exceed value

This is the time it takes for customers’ expectations of your product value to be exceeded. An example would be completing a major project or feature release for a customer that blows them away and encourages them to both continue using your product. However, this could also include them referring new customers or leaving positive product reviews. The goal for exceeding value is to encourage lifetime customer value growth.

How to Improve Time to Value

Improving TTV is all about decreasing the time it takes customers to reach that Aha! moment. Here are a few methods to improve the customer experience and drive home your product’s value.

Use customer goals to set milestones

Customers are trying to achieve a goal by using your product. Take the time to understand what their use case is, what success looks like, and expectations for your product. Once you understand their big picture goals you can work backwards to provide clear milestones for each customer to achieve along their journey. Quick opportunities for milestones to be hit work as a reinforcement for your product’s value. Every time a customer achieves something, even a small success, celebrate it with them. This creates a sense of collaboration and partnership, improving the experience of and satisfaction with your product.

Decrease product friction

A customer’s journey to seeing value is going to be short lived if your product is hard to navigate. If the menu is complicated, instructions are unclear, or setting changes aren’t easily accessible, customers are going to become frustrated and stop trying to use your product. That Aha! moment will never materialize. User testing and product usage statistics are a great way to make UX improvements and create a more intuitive workflow to help decrease TTV.

Provide resources

Right from onboarding and through a customer’s journey with your product they’re going to want resources to help guide their path to success. Everything from tutorials, FAQs, a general knowledge base, and additional support documentation are great resources to have on hand. You don’t want to overwhelm new customers all at once, but provide essential information for them to hit their milestones first and let them know where other helpful tips can be found. That way, if they have questions on feature functionality or want best practices they know where to find it. For worst case scenarios, make sure to provide them with contact information for the support team and yourself. This provides new customers with a steady leg to stand on and confidence that you’re a partner along their product journey.

Conclusion

In the competitive landscape of SaaS, companies put in a lot of work to obtain new customers, let alone keep them satisfied. One of the best ways to ensure your hard work is going to pay off in the long run is to decrease customer TTV. You can assist your customers in reaching their product goals and finding value via CSM engagement, helpful resources, and by creating a culture of collaboration. The faster new customers can experience and understand your product’s unique value, the more likely they are to incorporate your product into their daily workflow and remain loyal to your company.