The Secret to Successful SaaS Habit Formation

The ultimate goal of forming a habit is to find a solution to problems faced. In the SaaS world, a product functions as a relief or a solution to the pain felt by a company. Forming a habit takes time, and as is widely known, starting up is the hardest part!

  • Customers are not in the business of using your software.
  • Super successful products are ones that become part of a daily habitual routine
  • Habit formation takes 21 consecutive days of usage
  • Customer Success should think about facilitating habit formation by encouraging customers to go in certain directions, and prompting them daily

Habit Formation Takes 21 Consecutive Days of Usage

“It usually requires a minimum of about 21 days to effect any perceptible change in a mental image. Following plastic surgery it takes about 21 days for the average patient to get used to his new face. When an arm or leg is amputated, the “phantom limb” persists for about 21 days. People must live in a new house for about three weeks before it begins to “seem like home”. These, and many other commonly observed phenomena tend to show that it requires a minimum of about 21 days for an old mental image to dissolve and a new one to jell.”

Dr Maxwell Maltz ‘Psycho-cybernetics’ (1960)

This theory has proven to be effective in different spheres of human activity; why not apply the same to habit formation with software usage?

Context-Dependent Repetition

Habits are formed through a process called ‘context-dependent repetition’. For example, let’s take an individual whose work depends on internet and emails. Once he wakes up in the morning, the first thing he does is to check his emails. Here, a mental link is formed between waking up (context) and the dependency on the context (checking emails). With time, this link strengthens to a point that it becomes an automatic behavior, wherein the mind no longer needs to control or monitor this activity.

The Habit Loop

Habit formation is a process by which new behaviors become automatic. Every habit starts with a psychological pattern called the ‘habit loop’.

In ‘The Power of Habit’ (2012), Charles Duhigg explains that MIT researchers discovered a three-step neurological pattern that forms the core of every habit.

Cue/Trigger: The trigger that initiates the behavior
Routine: The behavior itself and the action you take
Reward: The benefit you gain from doing the behavior. Rewards help to determine if the habit loop is worth it or not.

Every habit follows this basic 3–step structure.

Going by the same 3-step structure, if a SaaS product rewards the customer (helps them inch closer to their desired goal), then the customer is sure to repeat the routine (use the product on a regular basis to gain more value), when the trigger happens (it could be in the form of a notification, email, call or any proactive initiative from the CS team).

Nir Eyal with Ryan Hoover in their handbook, ‘Hooked: How to Build Habit Forming Products’, are speaking about the same habit loop. They hook the users with internal triggers and variable rewards, along with an addition framework of investment. Investment refers to time, data, effort, or money put in by the user into the product or service.

Super Successful Products Become Part of the Daily Habit

A product becomes super successful when more and more customers use it. It’s only when a product plays a crucial role in the user’s life, that it can become a part of their daily routine. Dependency has a very important role to play. Either the user is dependent or the product is designed in a way that it makes users dependent. Here, dependency holds a positive and constructive motive. Dependency in this context is all about quick results and growth. SaaS products, which are designed to enhance work productivity and efficiency, have the stickiness factor for habit formation.

Customers Are Not in the Business of Using Your Software

Customers have a need so they purchase a software, but they don’t end up using it. What could the possible reason be?

Is it that they find the product complicated to use, are they not able to figure out how to implement it, or is the company unable to get its employees to use it? Present day customers are not into buying products, but rather buying results.In the CS field, results are visible when you have a well-performance product that has complete guidelines. Training end users on the product by scheduling webinar training, providing help documents, videos, and infographics will facilitate the customer to get acquainted with the product.

Success of SaaS companies

Encourage Customers to Go in Certain Directions to Facilitate Habit Formation

Each one of us might have experienced that it’s very easy to reach a destination if one has a roadmap in hand. Similarly, if the CS team can provide their customers an overview about when and how their desired goals can be achieved, then the customer will surely move as directed by the CS team. This can be done by linking the features of the product to the problems faced by the user.

To make your software a part of your customer’s daily routine, the product must first be made sticky. That’s definitely a hard task, but only then can the software be the first thing on your customer’s mind.

The journey to keep the user hooked to the product starts right from the time of onboarding, when there is a lot of curiosity to know and understand how to use the product. Proper training comes in next. Once the features are clear, it’s the simplicity and stickiness that cements the users’ commitment to the product. Constant engagement with the user strengthens this commitment, which can be in the form of additional notifications to highlight the most pertinent updates, and show value garnered.

Customer Success needs to gear up their creative minds and come up with new features that work as a trigger, encouraging their customers to explore and get value from the product. Making them feel rewarded and this feeling will boost the habitual usage of the product.

Shreesha Ramdas

CEO & Co-Founder, Strikedeck