1.
Killer SaaS Metrics.
The Impact of Churn, Customer Success and
Instrumentation on SaaS Performance
Stanley Sarpong, Olju Man & Atiq Khan.
@
Updated January 2014
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2.
The Blind Men & Elephant.
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3.
Saas Conversions.
Case Study
200,000 Visitors
10%
20,000 Free Trial Signups
2.5%
500 Free Trial Users
40%
1%
200 Converted to paid
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4.
Key SaaS KPIs.
1. COCA
2. LTV
(Cost of Customer Acquisition)
(Life Time Value per Customer)
3. Churn
(Customers you lose per month/year)
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5.
Why Churn is Your Killer Metric.
Potential impact of Churn on Revenue & Valuation
Success Metrics
Scenario 1
Scenario 2
Customers Acquired
1200
1200
Average Monthly
Revenue per customer
$700
$700
Customers Lost
180
90
Customer Churn
15%
7.5%
6.7
13.3
$5.6M
$11.2M
$28M
$56M
Average Lifetime in
Months per customer
Total Revenue
Valuation
(if 5x)
5 Years Example.
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6.
T Ford.
The car without a dashboard
You can drive it, but you do not know how far you will get.
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7.
Key Metrics per Evolution Stage.
1. Site Visitors
2. Trials
3. Stickiness
4. Signups
5. Recurring Revenue
6. COCA & LTV
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8.
One Metric That Matters.
At each stage of the business evolution
1. Site Visitors
200K
Early Days
Visitors
Optimization Opportunity!
10%
20K
2. Trials
Signup
conversion
Signed Up
500
Trial started
3. Stickiness
0.25%
Visit to Trial Conversion
4. Paying
Clients
250
0.125%
Active Trials
Sticky Trial Users
200
Converted from Trial
5. Recurring
Revenue
Recurring Revenue from
previous month/year
Net New Recurring
Revenue per
month/year
6. COCA & LTV
Marketing & Sales
Expenses / Total new
clients
Average monthly/yearly
revenue per client *
Lifetime of Client
&
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9.
Free Trial Anatomy.
Best in class metrics based on 80/20 rule
Early Days
10%
1. Active Trial Users
250
Optimization Opportunity!
Active Trial Users
Trial users most likely to buy.
20%
2. Casual Trial Users
500
250
Trial started
Active Trial Users
Nurture casual trial users to increase conversions.
70%
3. Accidental Signups
20K
500
Signed Up
Trial started
Likely to churn.
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10.
Thank you.
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