1. Customer Churn Percentage
Customer churn, sometimes referred to as logo or account churn, measures the rate at which customers stop doing business with you. It’s a straightforward but crucial metric.
How to calculate: Look at how many customers you had at the end of the previous month compared to the current month, using a 30-day rolling average if needed.
Why it matters: It shows which part of your user base is slipping through the cracks. Keeping this low is pivotal to success.
2. MRR Churn Percent
Monthly Recurring Revenue (MRR) churn percentage reflects the revenue lost month over month.
Details: Think of it like customer churn, but with a focus on dollars and cents. It factors in different packages, upsells, and add-ons.
Significance: This metric offers a clear view of revenue health beyond just customer numbers.
3. Net MRR Churn
Net MRR churn is perhaps the most telling of all revenue churn metrics. It considers only the churned revenue minus any expansion revenue.
Purpose: It highlights whether your customers continue to find ongoing value, devoid of expansion or upsell influences.
4. Expansion MRR Percentage
For many first-time SaaS founders, understanding expansion revenue is a new concept.
Concept: It's all about assessing additional revenue generated over an account's life. Imagine a customer starting with a $50 plan but eventually choosing additional services or features that increase their spend over time.
Application: This is directly linked to how your CSMs drive upsells, cross-sells, and retain revenue.
5. Net Promoter Score (NPS)
The Net Promoter Score measures the willingness of customers to recommend your company to others.
Insight: “How likely are you to recommend our company to a friend or colleague?” on a 1-10 scale.
Promoters (9-10)
Detractors (1-6)
Neutrals (7-8)
Why track it? It's a succinct measure of product satisfaction, customer service, and the likelihood of organic growth through referrals.
6. Customer Satisfaction Score (CSAT)
CSAT is an easy but effective way to gauge customer happiness after interactions.
Approach: Often it follows support queries, questioning customers on a 1 to 5 star scale regarding their satisfaction.
Feedback loop: As a leader, you need this data to determine where to improve or maintain current efforts.
7. Customer Experience Score (CES)
The CES is an under-discussed but crucial metric.
Detail: Ask customers to rate their effort for certain interactions on a 1 (effortful) to 5 (effortless) scale.
Utility: Whether it’s onboarding or adding a new feature, knowing the CES helps refine processes and adjust priorities.
Quick Recap
Customer Churn Percent
MRR Churn Percent
Net MRR Churn
Expansion MRR Percent
Net Promoter Score
Customer Satisfaction Score
Customer Experience Score
