Time to value (TTV) is a metric that measures the amount of time it takes for a customer to realize the value of your product. In other words, it measures how swiftly users can start using your product effectively and achieve their desired outcomes.
How to measure Time to Value
The Time to Value metric can be measured in multiple ways. One way is to calculate the “Time to Purchase”, this is the duration between a customer's first interaction with your product or service and buying it. Another way is calculating the Onboarding duration, which can be considered the moment a user finds value in your product. Another method is to use a customer journey map to identify the key touchpoints at which customers realize value from your product. You can then calculate the average time it takes customers to reach each touchpoint.
Key Components
- Acquisition: TTV begins when a user completes the necessary steps to acquire your product. This could involve signing up, making a purchase, or any other relevant action required to gain access to the product.
- Onboarding: The onboarding process is a critical phase that directly affects TTV. It includes activities such as account setup, configuration, user profile creation, and initial guidance on how to use the product. Clear and streamlined onboarding processes can significantly reduce TTV.
- Learning Curve: TTV also considers the time it takes for users to learn how to use the product effectively. Intuitive design, user-friendly interfaces, and comprehensive documentation contribute to minimizing the learning curve.
- Configuration and Customization: If your product requires configuration or customization based on individual user needs, the time it takes to complete these actions contributes to TTV. Simplifying this process can accelerate time to value.
- First Use and Activation: TTV is realized when users engage with your product's core features and derive meaningful value from it. This might involve performing tasks, achieving goals, or experiencing initial benefits.
Importance of the TTV metric
- Customer Satisfaction: A shorter TTV leads to quicker customer gratification. Users are more likely to be satisfied if they can start benefiting from your product sooner.
- Retention and Churn Reduction: A longer time to value can frustrate users, leading to higher abandonment rates and churn. Reducing TTV can help retain customers and decrease churn.
- Time-to-Market: TTV is closely tied to your product's time-to-market. The quicker you can get users to experience value, the faster you can establish a competitive edge.
- User Engagement: When users experience value promptly, they're more likely to engage with the product regularly, explore advanced features, and become advocates.
- Monetization and ROI: For products with a monetization model, a quicker TTV can lead to faster revenue generation and improved return on investment (ROI).
How to improve the Time to Value metric
- Simplified Onboarding: Streamline the onboarding process by eliminating unnecessary steps and providing clear guidance.
- Guided Tours and Tutorials: Offer guided tours, interactive tutorials, and tooltips to help users learn the product quickly.
- Pre-Configuration: Pre-configure settings based on best practices to reduce the initial setup burden on users.
- Progressive Profiling: Collect essential user information gradually, reducing the upfront information entry requirements.
- Personalization: Leverage user data to personalize the product experience, making it more relevant and valuable to individual users from the outset.
- Prioritized Features: Ensure that core features that deliver immediate value are easily accessible and highlighted.
Time to value is a critical metric for product managers to track. By understanding how quickly customers are getting value from your product, you can make better decisions about product development, pricing, marketing, and sales.
