Activation rate
Also known as: user activation rate, onboarding completion rate, time-to-value conversion
Activation rate is the share of new users or customers who reach the first value moment, an action the business defines as proof the product worked for them, within a set time after sign-up.
Activation rate = new users who reached the activation event within N days / new users × 100%Activation answers whether new users got what they came for. Sign-up shows intent; activation shows the first real result. In the AARRR model it sits between acquisition and retention, and it usually predicts retention better than sign-up volume does.
There is no universal activation event. An invoicing tool might count the first invoice sent, a payments platform the first successful transaction, a telehealth service the first completed consultation.
Example
A B2B payments platform counts its May cohort. New sign-ups: 2,000. Activation event: the first live payment processed within 14 days. Accounts that reached it: 540.
Activation rate: 540 / 2,000 = 27%.
After 90 days, activated accounts still processing payments: 380 / 540, about 70%. For the rest: 90 / 1,460, about 6%. A gap that wide means the event is a good choice. The figures are illustrative.
How to use it
Pick the event from data: compare actions taken in the first days by users who stayed with those who left, and choose one that separates them clearly. Fix the time window too, such as 7 or 14 days, because “ever activated” keeps rising and hides slow onboarding.
Measure by sign-up cohort and by acquisition channel. A channel with cheap sign-ups and low activation often costs more per active user than an expensive one.
Common mistakes
- Choosing an event that is easy to reach but says nothing, such as completing a profile.
- Changing the definition without restating past cohorts.
- Counting team members invited by an existing customer as new activated users.
- Reporting activation without the time window, so one team quotes a 7-day figure and another a 30-day one.