.png)
Read TL;DR
- Time to value (TTV) is a key SaaS metric that measures how quickly customers experience the benefits of your product. It represents the time from sign-up to the "aha moment" when customers see value.
- A faster TTV improves customer satisfaction, reduces churn, and increases retention, making it a key driver of business growth.
- While immediate TTV occurs with instant value realization (e.g., analytics dashboards), longer TTV is typical for complex solutions like ERP systems that require extensive implementation.
- Companies can improve TTV with strategies like streamlined onboarding, personalized experiences, and automation.
- Tracking TTV using tools like Drivetrain helps you identify bottlenecks, measure customer success, and optimize value delivery.
- Want to discover how SaaS metrics like TTV impact your financial planning? Download the SaaS metrics-based planning template.
Time to Value (TTV) measures the amount of time it takes your new customers to get value from your offerings. It represents the journey between when a customer signs up and when they have their “aha moment.”
It’s that moment when they truly understand and experience the benefits of your product – they clearly understand how it can help them solve problems or achieve their goals. And the sooner you can help your customers reach that point, the better the chances are of retaining them.
TTV is a vital customer retention metric that measures the time it takes your new customers to get value from your SaaS product. Customer retention directly impacts financial stability and business growth in SaaS. By optimizing TTV, companies can enhance customer experiences, inspire loyalty, and build a competitive edge.
In this article, we’ll explore TTV, show you how to calculate it and give you tips for reducing it to improve customer retention and satisfaction.
Table of Contents
Understanding “value” in time to value
The faster SaaS customers perceive value, the more likely they are to remain loyal and recommend your product to others. The “value” in TTV can be defined in two different ways. On the quantitative side, there’s “business value,” which includes measurable ROI metrics like cost savings, revenue increases, and improved cash flow cycles. On the qualitative side, you measure “perceived value” through user adoption rates, stakeholder satisfaction, and workflow optimization. While these metrics might seem soft, they're leading indicators for customer retention and lifetime value (LTV).
What affects perceived value?
Another important concept in TTV is the time it takes for users to experience value. This time varies depending on the complexity and purpose of the software. There are two parts to this: the “time to go live” and the “time to impact.”
Some SaaS tools, like financial reporting software, can demonstrate immediate value by providing instant visibility into key metrics. However, some solutions, such as enterprise-grade ERP systems often require a longer implementation cycle. While they can deliver substantial ROI through improved financial controls, automated reconciliation, and streamlined compliance processes, it can take much longer to begin seeing that ROI. In a nutshell, TTV often depends upon the type of SaaS product. This makes it important to set reasonable expectations with prospective and new customers to ensure you can meet them.
Learn more about SaaS metrics here
Importance of TTV in SaaS
In SaaS, customers cancel their subscriptions if they don't see value quickly enough. TTV is a key metric that helps leaders track and predict retention rates, customer acquisition costs (CAC), and the overall financial health of the business.
Compensating for the value of one lost customer can require the acquisition of three new customers. — McKinsey
Here is why companies aim to have a shorter TTV:
1. Pre-CAC recovery churn
When customers churn during implementation, before a company recovers its CAC, it has the highest financial impact, especially on cash flow efficiency. Imagine investing in sales, marketing, and implementation resources without generating any revenue return.
2. Expansion opportunities
When SaaS customers fail to see value in the first 30-60-90 days after the initial implementation, they're likely to resist or ignore discussions about additional features or upgrades. It becomes challenging for teams to drive meaningful conversations about expansion, which further results in lower LTV.
3. Lower net promoter scores (NPS)
Customers who don’t realize value quickly enough rarely become advocates. They are far more likely to give negative or passive NPS ratings. This not only reduces the pool of reference customers for future sales but could also result in lower ratings on G2, Capterra, and other software review platforms.
4. Competitive vulnerability
SaaS products with a slow time to value can create vulnerability in their market position. When customers struggle to realize immediate benefits, they actively begin exploring alternative solutions. Competitors can easily exploit this situation and steal customers who become frustrated waiting to see results.
What are the different types of TTV?
Time to value is categorized into five different types based on value realization speed.
1. Time to basic value
Time to basic value measures the time it takes for customers to realize the value of your product at a very early stage of using it. This milestone proves the initial ROI and validates the purchase decision.
Example: A sales team logging their first qualified lead in a new CRM platform. This milestone validates the purchase decision and demonstrates initial ROI.
2. Time to exceed value
This is where customers discover value beyond core features. At this point, they’re past their first aha moment! Time to exceed value (TTEV) happens after your customers have experienced the core value of your product.
Example: A team using budgeting and planning software discovers that it not only tracks key SaaS metrics but also its advanced features help save 30% more time on reporting than expected.
3. Immediate time to value
Immediate TTV occurs when users quickly see benefits, leading to fast adoption. This instant value encourages freemium users to upgrade as they explore advanced features.
Example: An analytics dashboard showing real-time website performance metrics or a team communication platform enabling instant message sharing.
4. Short time to value
Short TTV happens when SaaS products quickly solve a customer’s problem. This can occur within hours or even a day.
Example: Team collaboration tools like Slack, where departments can create shared workspaces, integrate with existing tools, and start collaborating within hours.
The main difference between Immediate TTV and short TTV is that immediate TTV provides value straight “out of the box”. But short TTV requires some setup or configuration before delivering value, even if that setup is quick.
5. Long time to value
This metric is generally applicable to products that require a longer implementation with complex setup and integration. While this longer timeline can create challenges for customer retention, it often showcases more transformative value delivery that can lead to stronger customer relationships.
Example: Enterprise-wide implementation of an ERP system where the full benefit takes weeks or months to realize.
How can you decrease TTV?
Companies can ensure faster value delivery with the strategies below:
1. Streamline onboarding
By simplifying the onboarding process with step-by-step guides, in-app tutorials, and interactive walkthroughs, customers can complete the initial steps without getting overwhelmed. This enables them to achieve their aha moment quickly.
2. Personalize onboarding experiences
When you equip customers with welcome surveys and tailor their experiences, it makes sure that they see immediate value that aligns with their specific needs.
3. Enable customer support
Assigning customer success managers to guide users with 1-on-1 onboarding and ongoing support makes sure your team is easily reachable. This kind of proactive outreach during the early stages helps resolve roadblocks and speed up value realization.
4. Self-serve onboarding
About 81% of customers attempt to resolve issues independently before reaching out for help. Implementing self-serve onboarding can decrease TTV by helping customers get started on their own without waiting for external assistance. You can do this by offering product academies, interactive guides, templates, and knowledge bases that allow customers to progress at their own pace.
5. Use automation
Automating repetitive tasks like setting up integrations or data imports saves customers time and effort. Additionally, AI can streamline these processes by pre-filling forms, suggesting optimal settings, or auto-configuring tools based on user behavior and preferences. This reduces manual work, minimizes errors, and helps them achieve key milestones quickly.
6. Milestone-based progress tracking
By breaking down the customer journey into smaller, achievable milestones, companies can make the path to value more manageable and engaging. Clear progress indicators, like checklists, progress bars, or achievement notifications, provide customers with a sense of accomplishment as they complete each step.
Customer onboarding teams are in the best position to directly influence TTV. Here’s some of the things they work to achieve for new customers and how they do it:
- Better conversions: Smooth onboarding shortens TTV by guiding users swiftly to their "aha" moment. This increases the likelihood of converting trial users into paying customers.
- ROI realization: When customers achieve their desired outcomes sooner, they see a quicker ROI. By facilitating early value realization, onboarding reinforces their decision to choose your product.
- Feature adoption: Introducing features progressively during onboarding encourages users to explore and utilize more functionalities, maximizing the product's value and stickiness.
- Faster user proficiency: Structured onboarding educates users efficiently, allowing them to become proficient with the product in less time. This swift competency reduces frustration and enhances user satisfaction.
- Enhanced user confidence: Clear guidance and support during onboarding builds user confidence, empowering users to navigate the product effectively and achieve their goals.
- Personalized value delivery: Tailoring the onboarding experience to individual user needs ensures that each customer quickly accesses the most relevant features, enhancing satisfaction and reducing TTV.
While Onboarding teams play a direct role in reducing TTV, other teams can impact it in other ways.
How customer success teams can impact TTV
Customer success (CS) teams bridge the gap between product capabilities and customer outcomes. They work on the frontlines to make sure customers not only implement the solution but achieve meaningful business results as quickly as possible.
This involves:
- Proactively monitoring customer progress and intervening at important moments to remove obstacles.
- Establishing clear success criteria and value milestones early in the relationship.
- Analyze data to develop targeted intervention strategies for different customer segments, ensuring each customer has a clear path to value that aligns with their specific needs and goals.
Finance team's role in TTV optimization
As SaaS continues to become more competitive, finance teams should focus on time to value as a key driver of business health. By keeping an eye on TTV, finance teams can make data-driven decisions that can positively impact customer success and help ensure predictable SaaS growth. To drive better TTV outcomes, finance teams can:
- Analyze the correlation between implementation speed and key metrics like CAC recovery, expansion revenue, and LTV. This financial analysis helps identify bottlenecks where delayed value realization impacts cash flow and revenue recognition.
- Optimize resource allocation by evaluating different implementation approaches and automation investments based on their TTV improvement potential.
- Proactively identify high-risk implementations where delayed value realization can threaten revenue targets or trigger potential churn.
How to achieve alignment between the sales, onboarding, and customer success teams
Sometimes, in their earnest efforts to close deals, sales teams might overpromise during deal negotiations, committing to features not yet available, or guaranteeing unrealistically short implementation timelines. Or they might forget to mention a specific ask by the customer. These practices and inadvertent omissions can create a ripple effect where the onboarding team inherits inflated expectations they cannot fulfill. Often, by the time customer success teams take over, they’re fighting fires, working hard to manage customer frustrations stemming from earlier missteps.To break this cycle, you have to get all three teams – sales, onboarding, and CS – aligned. Here’s a few things you can do to achieve that:
- Setting realistic expectations upfront: Sales teams must align promises with actual deliverables. Clearly defined success criteria should outline what “value” means to the customer and what can realistically be achieved.
- Streamline handoffs: Detailed customer notes, and context must be shared during each handoff—for instance, sales to onboarding and onboarding to customer success.
- Break down implementation into phases: Structured implementations with early wins help build customer confidence while showcasing progress toward long-term goals.
- Create feedback loops: Regular check-ins between teams ensure alignment, prevent gaps, and keep the customer journey on track.
How to measure time to value
Measuring TTV helps you understand how quickly customers experience the value of your product. Here’s how you can measure time to value:
1. Time to upgrade from free to paid
If your SaaS employs a “freemium model”, track how long it takes for users to upgrade from a free version to a paid plan. A quicker transition often means users see value quickly and are more likely to commit in the long term.
2. Customer onboarding time
All SaaS companies have some type of onboarding, which can range from a largely self-serve process (e.g. a video sequence to show the customer how to get started using the product) or “white glove” onboarding with a dedicated onboarding team.
No matter what type of onboarding you offer, you need to measure how much time it takes from when a customer signs up to when they complete the onboarding process and start using key features. This will offer key insights into where they might be struggling and thus what you can improve on to shorten their TTV.
3. Adoption time for new features
Assess how quickly users begin adopting new features after they are released. The faster they adopt, the more likely they are to recognize the value in your product’s ongoing evolution.
4. Time to achieve desired ROI
You also need to track how long it takes for customers to see a return on investment after using your product. The quicker they see ROI, the more likely they are to remain satisfied and continue using your product. This is where your CS team can help. They interact with customers every day and will likely learn when the customer begins achieving an ROI.
5. Time to first key action
Measure the time it takes for new users to complete a significant first action, such as creating their first project or sending their first message.
What those key actions are depends on the type of product. Basically, they are the steps any user would need to take to begin realizing your product’s core value.
When a user takes that first action quickly, it usually means your product offers an intuitive user experience that drives a faster TTV.
6. Frequency of key actions
Tracking how frequently users complete other key actions within your product also helps you gauge TTV. The more of these steps users take and the more often they take them indicate higher engagement and a quicker path to value realization.
A simple formula for TTV
Once you have defined what the core value of your product is and what the “signals” are that indicate when users are achieving that, calculating TTV becomes pretty easy:
TTV = Date the customer begins experiencing value - the number of days since becoming a customer
How Drivetrain can help you monitor and optimize time to value
TTV is a key driver of long-term business growth. The faster customers realize value, the higher your conversion rates, customer satisfaction, and, ultimately, revenue growth.
By prioritizing rapid value delivery, you not only meet customer expectations but also gain a significant edge in customer retention and expansion.
Technology plays a key role in tracking and managing TTV. From automating data collection to providing real-time insights, the right financial planning tools can help you identify bottlenecks, streamline workflows, and measure success at every stage of the customer journey.
With Drivetrain, you can simplify TTV tracking and focus on delivering value where it matters most. With 200+ integrations, Drivetrain connects with different systems and automates data collection and validation. Its dynamic dashboards not only help you monitor TTV but also provide actionable insights into revenue growth and unit economics.
If you’re still juggling spreadsheets to track and measure TTV, it’s time to explore Drivetrain.
FAQs
Time to Value directly impacts key business metrics like conversion rates, customer satisfaction, and revenue growth. When customers realize value quickly, they're more likely to convert from trial to paid, expand their usage, and become long-term advocates. Slow TTV, on the other hand, leads to higher churn rates and missed expansion opportunities, ultimately affecting your bottom line.
For a product-led SaaS product like Zoom, TTV is the time between signing up and successfully hosting their first video meeting with their team. For an enterprise SaaS product like Workday, TTV is the time between implementation kickoff and achieving streamlined HR processes across the organization.
You can measure TTV by calculating the time it takes from the customer's first interaction (like signing up or purchasing) to the moment they achieve their first meaningful outcome.
