What is SaaS Quick Ratio? SaaS quick ratio is a metric that assesses a company’s ability to grow its recurring revenue despite the churn incurred. Essentially, the ratio compares the company’s revenue inflows (new and expansion MRR) and its revenue outflows (churned MRR and contraction MRR) to show net revenue growth. SaaS quick ratio is…
What is Viral Coefficient? The viral coefficient is a metric that determines the number of new users generated by referrals from existing customers. The metric is merely an estimate of a company’s virality, which describes the exponential referral cycle. Products or services with a viral coefficient greater than 1 are considered viral. Viral products promote…
What is Months to Recover CAC? Months to recover CAC, also known as CAC payback period, is a metric that shows the amount of time (measured in months) required to recover investments in customer acquisition. In other words, it indicates how quickly the company’s investment in customer acquisition reaches a break-even point. SaaS companies and…
What is Lead Velocity Rate (LVR)? Lead velocity rate (LVR) is a measure of the growth percentage change of qualified leads from month to month. Note that a qualified lead (also known as a marketing qualified lead) is a prospective customer who has already shown interest in purchasing a company’s product or service and successfully…
What is Click-Through Rate (CTR)? Click-through rate (CTR) refers to the ratio of the number of users exposed to a specific link on a website page or in an email who click the link and view the advertised product or service. CTR is primarily used by digital and online marketers to quantify the success and…
What is Churn Rate? Churn rate, also referred to as attrition rate, measures the number of individuals or units leaving a group over a specified time period. The term is used in many contexts, including in business, human resources, and IT. Most notably, churn rate is referred to as the proportion of contractual (or subscribed)…
What is Average Order Value (AOV)? Average order value (AOV) is an e-commerce metric that tracks the average dollar amount spent whenever a customer places an order on a website or application. AOV is considered one of the most important metrics in the e-commerce industry. Essentially, the average order value may provide some…
What are Monthly Active Users (MAU)? Monthly active users (MAU) is a term that refers to the number of unique customers who interacted with a product or service of a company within a month. Essentially, MAU is a key performance indicator (KPI) that measures online user engagement. The metric is primarily used by internet businesses,…
What is Visitor-to-Lead Conversion Rate? Visitor-to-lead conversion rate (also known as traffic conversion rate) is a metric that indicates the proportion of visitors to a website that is converted into leads in a given period. Recall that a lead is a prospective customer who already expressed their interest in purchasing a product or service. Understanding…
What is Customer Churn vs Revenue Churn? Every company operating under the SaaS business model must track a significant number of metrics, including customer churn vs revenue churn. Reporting and analysis of all metrics is extremely time-consuming and not an ideal solution in most cases. Eventually, every SaaS company faces a dilemma on which metrics…
