IDC #EUR145482319 Sage Infobrief

IDC #EUR145482319 Copyright IDC 2020 14 How to Become a Great SaaS Partner What financial metrics are critical to SaaS success? Annual recurring revenue (ARR) ARR is a simple metric to track the amount of recurring revenue generated. It is either the total value of recurring revenue from a customer or all customers in a year. Customer lifetime value (CLV) CLV is a projection of the total net profit derived from the customer relationship throughout the life cycle. Maximising CLV is the essential goal in the SaaS world. Gross retention rate (GRR) Mitigating churn and boosting retention is critical to profitability and success in SaaS. Gross retention or GRR is the percentage of renewed recurring revenue over a specific period. GRR cannot exceed 100%. Customer acquisition cost (CAC) CAC is the average sales and marketing expense needed to secure a new customer.