SaaS businesses vary from traditional businesses in concept and therefore require different metrics to accurately measure SaaS effectiveness and success. In the SaaS/cloud business model, customer retention plays a significant role in driving growth and revenue. Therefore, SaaS companies must effectively measure SaaS metrics to evaluate success and improve business processes.
Gainsight ensures success by focussing on three important aspects namely customer acquisition, customer retention and customer monetization. Considering the importance of customer retention in the SaaS business model, Gainsight focuses on metrics that explore retention and churn. It leverages customer intelligence and automation to control retention, bring down unexpected churn and discover up-sell opportunities. Gainsight believes that SaaS metrics provide valuable insights for making the most informed, efficient business decisions. Below are some key SaaS metrics that Gainsight focuses on.
- Recurring revenue (MRR, QRR or ARR)
- Churn rate
- Average recurring revenue
- Customer acquisition cost
- Average cost of service per customer
- Customer lifetime value
