Onboarding is one of the like the welcome greeting that a user gets. So it should be a memorable and impressive one to give your users a good impression about your brand and your product.
There are multiple ways in which you can onboard a user. One of the most common ways is through sales reps, but this can be time-consuming and resource-intensive—especially if your tool and the features you offer are complex or if your team is small. This is where product-led onboarding saves the day, enabling users to explore and adopt the product with minimal need of human intervention.
In this guide, we will understand what product-led onboarding is, how to optimize it to boost user engagement and retention, and ensure high conversion rates.
Before we actually start understanding what product-led onboarding is, let’s give you some context first.
What is onboarding?
Onboarding is the process that helps a new user get familiar with a product after signing up by taking the user through the features and functionalities of the product. This includes tutorials, initial setup, and feature and tool exploration.
Under the broader onboarding process, there are two most commonly used approaches --- sales-led onboarding and product-led onboarding.
What is product-led onboarding?
Product-led onboarding is a strategy where the product itself guides users through the onboarding experience, eliminating the need for sales teams or support agents. By making the product intuitive, engaging, and rewarding from the start, this approach ensures users quickly understand its value and functionality on their own.
For SaaS companies, this becomes crucial because it:
- Guides users to discover how your product solves their problems
- Makes the value of the product clear during the onboarding journey
- Provides a smooth, self-guided process that reduces friction, ensures user engagement, and lowers the chances of abandonment
- Minimizes reliance on customer support, allowing you to accommodate more users without expanding support teams
Who uses product-led onboarding?
Product-led onboarding is typically executed by SaaS companies that focus on self-service models and want users to experience the product’s value on their own. These companies prioritize delivering an engaging, frictionless experience that doesn’t rely heavily on sales or support teams. This strategy is most commonly used by companies with scalable products that can deliver their value quickly.
When is product-led onboarding done?
Product-led onboarding is the step right after a user signs up for the product. As soon as the user enters the platform, the onboarding process begins, guiding them through essential features and helping them achieve their first successes. It’s designed to get users to their "aha" moment, where they experience the product's value through their onboarding journey.
The question to consider here is: Does the onboarding change as per the model or the price of the product?
Yes, the onboarding process can change based on the product model. For example, in the case of the self-service model, the onboarding process is more automated and contains in-app messages, tooltips, and self-paced tutorials.
Some companies, however, mix product-led onboarding with customer support-led onboarding to add a personalized touch for high-value customers. In such cases, the product-led onboarding may start with self-guided steps and escalate to human touchpoints for more complex needs or specific feature exploration.
Additionally, product-led onboarding can be affected by the product’s ticket size. For lower-priced or freemium products, the onboarding process is typically more automated, offering quick and easy ways for users to get started without much assistance. For higher-priced products, especially enterprise solutions, the onboarding might be more personalized, including dedicated support or customer success teams that guide users through more complex features.
How is product-led onboarding different from sales-led onboarding?
When comparing sales-led and product-led onboarding, the main difference lies in the level of human involvement and the reliance on the product to guide users versus direct support from a team.
Sales-led onboarding typically involves direct interaction with sales or support teams to guide the user through the onboarding process. Product-led onboarding, on the other hand, focuses on the product itself as the primary means of guiding the user, making the experience more self-driven and intuitive using multiple activation points or milestones.
How to measure the success of your product-led onboarding process
The success of product-led onboarding can be measured using several key metrics:
- Activation rate: This is the percentage of users who complete key actions (e.g., first message sent, first task created) that indicate they’re following the process and exploring the features.
- User retention: This measures how many users continue to use your product and renew their subscriptions. A high user retention rate indicates that your product-led onboarding is working well.
- Feature adoption: Tracks how frequently users are using the key features, indicating whether the onboarding process has been effective in guiding users to the most important features of the product.
By tracking these metrics, you can understand how well your product-led onboarding is working to engage users and get them to the point where they see the value in the product.
What is the correlation between product-led onboarding and user churn?
The time taken for a user to churn is often linked to the ‘time to value’. In other words, if users don’t quickly realize how the product can solve their problems or if the onboarding process is confusing, they are more likely to churn.
The correlation is straightforward: the faster a user experiences value, the less likely they are to churn. Products with a lower time to value have a higher activation rate and better retention, as users are more likely to feel confident using the product and become invested in its success.
For instance, if users can complete a key task or see results quickly—such as sending their first email campaign within minutes— they are more likely to stick around. On the other hand, if the value is delayed or the onboarding process feels overwhelming, the chances of churn increase. The key is to help users reach that "aha moment" as quickly and seamlessly as possible.
Product-led onboarding best practices
Creating an effective product-led onboarding experience involves a few key elements for consideration. Here’s a detailed look at these elements:
Create clear value propositions
Right from the start, users should understand how the product will solve their pain points. This could be communicated through messaging, visuals, or simple demos within the product. The clearer the value, the more likely users are to stay and engage.
Provide early wins to customers
You must provide users with early wins to make them feel accomplished and motivated. If you're an email marketing tool, this could be congratulating them on creating their first email template , setting up their first campaign and so on. By showing them something positive early on, you keep them invested in learning more.
Disclose features progressively
Instead of bombarding users with all of the product’s features at once, it’s important to introduce them gradually. This avoids overwhelming users and helps them focus on what’s most relevant to their immediate needs. You should also consider taking them through simpler features first and gradually introduce them to more complex ones.
How to design a product-led onboarding experience for your SaaS business
Here’s a step-by-step guide to designing a product-led onboarding experience:
Map the user journey
To create an effective product-led onboarding experience, start by mapping the user journey. Understand the key goals users aim to achieve and identify potential pain points they may encounter. Defining milestones where users experience value is crucial, as these touchpoints will guide the design of the onboarding flow and ensure that users are consistently moving toward success.
Identify the activation points
Identifying these points allows you to design onboarding flows that guide users toward these experiences as quickly as possible. Ask yourself: What does a user need to do to get value from your product?
For example, if you're an email marketing tool, activation points could be:
- Importing their email list onto the platform
- Designing the first email
- Scheduling or sending the first campaign
Develop the onboarding flow
Introduce the activation points in a step-by-step format. Use elements such as checklists, guided tours, and in-app messaging to guide users through essential steps. Also keep in mind to focus on core features rather than introducing all functionalities at once to prevent overwhelming new users.
Implement data-driven feedback loops
Use analytics to understand how users interact with and feel about the onboarding process. You can also collect feedback within the tool or send them emails asking for feedback on their onboarding experience. Use this data to continually optimize the onboarding process and address pain points. Data-driven feedback ensures that your onboarding flow evolves to meet user needs.
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Examples of product-led onboarding in action
Let’s explore how some leading companies successfully implemented product-led onboarding to engage and retain users:
Canva
Canva provides a very smooth onboarding experience. Upon signing up, users are greeted with a short, animated walkthrough that introduces them to key features, such as selecting templates, dragging and dropping elements, and saving designs. As users create their first design, they receive in-context tips that point out different tools in the sidebar and help them understand how to modify their design elements. This self-guided onboarding is interactive and encourages users to experiment with the product.
Slack
Slack uses a product-led onboarding approach to introduce new users to their chat features. As soon as users sign up, they are asked to create a team, send their first message, and explore channels. Slack uses in-app tips to show users how to use advanced features like integrating apps or creating private channels, making the learning curve much easier. These steps guide users through the product’s core functionalities while ensuring they experience value right away.
Dropbox
Dropbox uses clear in-app guides to show users how to upload files, organize them, and share them with others. This approach highlights the simplicity of the product and quickly demonstrates its value. The onboarding experience is simple and intuitive and doesn't take a lot of time to get used to the features in the tool.
Zoom
Zoom simplifies onboarding by guiding new users through scheduling a new meeting and joining meetings that are already set up, with built-in pop-ups that explain features in real-time, creating a frictionless experience for first-time users.
Takeaways
Product-led onboarding is a powerful strategy for SaaS companies that aim to enhance user engagement and retention. It allows users to experience the product’s value without friction and makes the onboarding process as seamless and intuitive as possible. By integrating guided steps, clear value propositions, and personalized experiences, companies can ensure users are engaged from the get-go.
A well-executed product-led onboarding strategy not only drives customer acquisition but also boosts long-term loyalty.
