When launching an enterprise software as a service solution, you need to carefully monitor the effectiveness of all the strategies you employ, from pricing to retention. So, here are five essential metrics to keep an eye on.
Customer Acquisition Cost (CAC)
The customer acquisition cost reviews your company’s buy albania telemarketing data health and growth potential.
Understanding how much it costs your business to acquire customers helps you fix your pricing and better allocate your resources.
A rising CAC rate tells you that adjustments need to be made to your marketing and sales efforts. Otherwise, you might end up sacrificing your business’s profitability.
CAC formula
CAC = (Marketing Costs + Sales Costs) / New Acquired Customers
Churn Rate
Why is churn important?
The churn rate is essential for vendors of all types of SaaS model solutions.
This is the metric that tells you what you are doing wrong by looking at the number of customers you are losing. The lower your churn metric rate is, the better it is for your business.
By closely monitoring and managing the churn rate, you are able to enhance customer satisfaction, improve your pricing, marketing, and even sales strategy, and, ultimately, make better and more informed business calls.
Churn rate formula
Churn Rate = (Lost Customers / Total Customers At The Start of The Period) x 100
Customer Lifetime Value(CLTV)
Why is customer lifetime value important?
The customer lifetime value rate is a crucial metric for SaaS vendors, as it indicates the potential growth of the company. For investor-funded businesses, CLTV occupies a leading position in the metric cheat sheet.
