One of the most important things for product-led companies is the time-to-value metric. It’s a great metric to use to optimise onboarding for product-led companies and saas products. Sales-led companies can use it too, but typically sales-led organisations require a longer TTV inside the product hence the demo’s being complex in the first place.
Other metrics that are important to your SaaS that support or wrap around the time to value metric are AARRR metrics (or pirate metrics) and the other is the MoSCoW methodology. These aren’t exhaustive but both help you figure out the retention of which TTV is essential.
The time to value framework
TTV metrics align with successful product-led companies and are essential across cross-functional teams. For PLG companies, focusing on the right metrics framework at the right stage of development helps create this alignment and provides teams with a pathway toward a common goal.
TTV measures how quickly a customer gains value from a product or service and is used to optimise the onboarding process in SaaS. The sooner a user can realise the products' value, the higher the chance of retaining them. Tie this into key actions you expect a user to take during activation and you can correlate activity to success or failure.
So what are the time to value metrics?
The types of TTV
There are six types of recognised TTV metrics, they are:
- Time to Basic Value
- Time to Exceed Value
- Immediate Time to Value
- Short Time to Value
- Long Time to Value
Let’s break these down in more detail so that you get a sense of where they fit in the overall TTV metrics framework.
Time to Basic Value
TTBV is the amount of time it takes a new user to get to the bare minimum value your product provides. In terms of optimising your onboarding process, this is the initial hook that will draw them deeper into the product to explore the rest of the value your product promises to deliver.
Time to Exceed Value
The TTEV metric focuses on the point that your product starts to deliver added value beyond the initial hook your user experienced when first using your product. It’s the precise moment the user realises there is more value than they expected the product to deliver.
Although I have mentioned this metric second, do not assume it's the only place in the user's journey where you can deliver this added value. In some cases, the additional value is delivered much later in the product's lifecycle and is an extremely useful metric in increasing the LTV (lifetime value) of your customer and generating lasting value and relationships.
Immediate Time to Value
Fousing on the immediate time-to-value metric gives you a single goal, to get an immediate joyful experience that hooks that user for the long term. This doesn’t have to be the ultimate value of the product, but significant and beyond features, we look at in the basic TTV metric.
Your goal is to provide extreme value within a few short clicks of the mouse and typically is achieved when you remove the registration/sign-up process or other barriers to entry. Think of Canva as a classic example.
Short Time to Value
With the short time to value (STTV) metric, we are trying to focus on how quickly a user can find the exact answer they need when they run into a problem with your product. If a user can do that, then they achieve a short time to value.
In other scenarios, this metric can be a great north star when figuring out how to quickly showcase what your product can deliver for your customers. Keep in mind that your follow-up on this metric is how you move the customer to find even more value once they have achieved this first step.
Long time to value
Our final metric of the time-to-value framework is the long time-to-value (LTTV) metric. Having an LTTV isn’t always a negative thing, just remember that our focus on reward these days gets ever shorter and ultimately you will need to provide good value in a reasonable amount of time.
If for example, your platform isn’t a tool that users would spend a lot of time with like middleware, connector (IPAAS) is another, then your user could be slow to run through the onboarding process. Focus on optimising the TTV to be as quick as possible and ask yourself, is your current process causing the early churn and low uptake?
So where do I take my TTV metrics?
After reading this it’s obvious that your goal is to focus on quick time to value with low barriers to entry and here’s a quick checklist of the benefits of doing that:
- Get to market quicker.
- Increase customer retention rate.
- Lower the number of resources spent providing value.
- Gain higher customer satisfaction.
- Get faster feedback on the product.
- Increase upselling opportunities.
- Start earning revenues from products as soon as possible.
Beyond improving TTV, improving what you can measure is how you ramp up more success. This is where value stream mapping (VSM) comes into the frame. VSM is a flowchart method to help illustrate, analyse and improve the onboarding steps of a product or service. The overarching approach involves looking at all of the steps in software production from the idea to the live product - the value stream.
How do you implement value stream management
There are four key things to focus on using VSM:
- Looking at features that add the most value to the product or service
- Leverage your people, process and technology
- Conduct A/B testing for faster feedback
- Simplify the product
When looking at the features that add the most value to your product or service, remain tightly focused on this. By leveraging the MoSCoW method around this key area, you can focus on maximum value and ship your updates faster.
In order to work fast and ship winning features, you need to be able to leverage the right people, processes and technology across the organisation to achieve your desired outcome. To support this we suggest having a centrally located person who looks at how the technology you purchase affects the company as a whole and if other teams can benefit. But most importantly make sure your tech speaks to each other so you can build better data pictures from multiple teams on what will really benefit the end user.
The need for A/B testing also relies on having the right tech in place, looking for platforms that allow you to run tests in real-time, and segmenting new features for example to different user groups or segments to test and iterate before a product-wide release.
And finally when you roll out your new updates focus on ease of use and simplicity of onboarding so that your customers can realise the value even faster after the updates have shipped.
Did you get time to value?
I hope that this article goes some way to helping you to learn to use frameworks within frameworks to achieve desired outcomes and optimised results.
I would like to believe that these short punchy articles get to the point and provide some direction on how you can use combination metrics and frameworks to drive success in your PLG organisation.
If product-led growth is the focus of your early-stage SaaS or your enterprise pivot, check out our guide to PLG for SaaS leaders and if need be feel free to reach out and have a chat.