At which point of interview process you expect that candidate tries the product?

If you are hiring the second/third employee for a Web based SaaS company, then at which point of interview process you expect that candidate tries the product? Immediately? Before phone interview? Before on-site interview?

The reason I'm asking is that I'm frustrated with people applying for very senior position without even trying the product - but maybe I'm just too picky.

I would think any candidate looking for a leg up would try the product on their own, but it also depends on the complexity of the product. If it's a full-blown CRM system, what part of the system do you expect them to be familiar with? If it's a more basic consumer-oriented webapp on par with Twitter or Dropbox in terms of simplicity, then your expectation is more reasonable but apparently still a bit optimistic. Why? There could be any number of reasons, but perhaps if they are applying at many places, they may not devote time to trying your product until late in the interview process (or perhaps not at all) unless you communicate your expectations to them at some point.

Depending on the position, it's also entirely possible that the candidate does not see the connection between using the product and fulfilling the job requirements for the posted job. For a customer service position, you probably would expect them to have some experience if it's a simple enough webapp. If it's a sales position, I'd say the candidates already failed to sell themselves if they don't know anything about your product. But if you're hiring an engineer, there might or might not be an obvious connection between the position they think they're applying for and the front-end interface. If you're hiring someone just to do IT work, that's even more separated--as long as they can keep your app running, they might not even need to know the first thing about using the software in order to fulfill the job requirements.

If you aren't getting enough self-motivated/aggressive candidates, I would highly recommend including "Experience using [product name]" as either a requirement or preference in your job listing.

Back in 1999 I co-founded a SAAS business and it was always a plus when candidates tried our product before coming in (it was free to try). Personally, I never offered a job to a candidate that didn't bother to look at our website, and I always asked them what they thought of the product and website during the interview.

During a time of fast growth, we made trying the product part of the hiring process for our sales team. After reviewing resumes, we would call candidates and invite them in for on-site interviews, and would tell them to be prepared to do a quick demo of our product when they came in for the interview.

We put all our cards on the table, telling them that the purpose of the demo was to show us their communication and presentation skills and to see how they handled themselves under pressure, not to test their product knowledge. Some would try the product and talk with existing sales/support people, while others would just wing-it.

Since our goal was not to test product knowledge, we did everything we could to put them at ease during the demo. If they stumbled over a particular feature of the product, we'd tell them what to do so they could get back on track. We let the candidate set the tone of the demo while we played the role of the prospect, asking questions and showing interest in specific features that they seemed most comfortable talking about.

These demo interviews definitely showed us which candidates could handle the job. Demoing the product was something they would do 20-30 times a day if we hired them. Those that met the process with enthusiasm and maintained composure were offered jobs, while those that got frustrated or were put off by the process were not.

Do you know what looking for a job look like from the candidate point of view?

For a senior developer (and other high-demand professions) there are way more open positions on the market than qualified people to fill them so a senior developer can get a lot of positions to interview for (the last time I was looking for a job, about a year ago, I had an average of 3 interviews a day! (not all of them were 1st interviews)).

note: I did make a point of visiting the web site of every company and trying to understand exactly what they were doing before the interview Someone who really want a position in your company (as in try to get hired specifically by you and not looking for a job generally) should learn everything about the company, including trying the product - but for a senior person to be that interested in your company you need to be somewhat famous, if you get your candidates from job boards or recruiters there's a good chance you are one of 10 or more companies they are interviewing for and they don't have the time to do comprehensive research on each position.

So your options are:

1. Concentrate on the abilities of the candidate, not on how much he/she wants to work for you (and how much he/she is willing to invest in getting hired by you).
2. Accept only candidates that tried your product, this will filter out most of the best people who have other offers but also the idiots who both can't get a job elsewhere and don't understand how to increase the chance of getting hired (I don't recommend this, gearing your hiring process for people who can't get hired elsewhere is not a good strategy).
3. Get famous as a good place to work so people will apply to you specifically and not look for a job elsewhere (not viable for a 2-3 person company)

Basically, if you want the best people (who, almost by definition, can get a job almost anywhere) you have to make the hiring process about them and not about you.