Here's a SaaS marketing strategy for converting and activating new customers.

My friends Aaron and Steve just launched a new course (High Performance SQLite), and I like their strategy for converting and activating new customers.

"Give them a taste!"

When you land on their homepage, you can either click "Buy Now" or "Start Watching."

If you click "start watching," you're immediately taken into the course; no signup or credit card is required.

You can watch the first two modules (Introduction, SQLite Internals) for free. It's only once you've progressed to the "Schema" module that they ask you to pay.

Investment loops and SaaS

An "investment loop" in user onboarding occurs when users start using the product with a low-friction entry point (no signup form). As they progress through the onboarding, they become more likely to continue using the product. Only once they're sufficiently invested do you ask them to sign up with email (and perhaps their credit card).

I wonder if SaaS marketers should be doing this more often:

1. Have people click "get started" and immediately bring them into your app (don't even ask for an email).
2. Only ask for signup info once they've started making some progress. "Sign up to continue."

The goal is to reduce activation friction, give people a taste of your app, and get them in motion, moving towards their goal.

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SaaS onboarding example

For example, here's our current signup/activation flow at Transistor (a podcast hosting platform):

1. Visit marketing site
2. Click "Start a free trial"
3. Enter credit card details
4. Arrive in the dashboard
5. Click "Create new podcast"
6. Enter podcast details
7. Click "Add episode"
8. Publish episode

But using an investment loop strategy, we could change the activation flow to this:

1. Visit marketing site
2. Click "Start your podcast"
3. Enter podcast details
4. Click "Add episode"
5. Publish episode
6. "Sign up for a free trial to continue"

This differs from offering a freemium (which is more like a full basic version of your product) or a free trial (where you sign up and use the product for 7-14 days). It's more of an activation strategy, where you get users to use the product before asking them for signup details.

The Psychology of Investment Loops

Investment loops work on several psychological levels.

The endowment effect

Once people start using your product, they begin to feel a sense of ownership. They've customized it, added their data, and now it feels like "theirs."

Sunk cost fallacy

The more time a user invests in a product's onboarding, the more likely they will keep going (even if it means pulling out their credit card).

The IKEA effect

People value things more when they've put effort into creating or setting them up.

By the time users hit that "sign up to continue" prompt, they've already built something in your app. They're not just buying your product; they're protecting their investment.

It's like giving someone Lego pieces, letting them build half a castle, and then asking if they want to buy the rest of the set. Who's going to say no to finishing the project?

Have you tried this?

I'm curious to know if any of you have implemented an onboarding "investment loop" like this. Does it work?

I'm thinking about it for my own product, but it also feels like it has risks. Maybe it decreases the chances that people sign up for a trial! Maybe it doesn't actually improve trial-to-paid conversion rates.

I'd like to hear from you! Reply to this email and tell me your thoughts.
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(or leave a comment on YouTube or reply to this tweet)

Cheers,
Justin Jackson
​@mijustin​

PS: are you building a web app / SaaS with Laravel? If so, I'd love to know about it. Reply to this email and tell me what you're up to.
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