Internet Sales strategies have a significantly lower CAC of just $0.42

Compared with previous surveys, field sales lagged inside sales by a greater amount this year (6% in 2015 vs. an insignificant 2% difference in 2014). Median growth among field sales dominated companies slightly lagged inside sales dominated companies (by 6% points), but led internet sales by 8% points. Channel sales dominated companies grew significantly faster, though the data is sparse. Mixed also performed well.

SaaS + Software Stats

• In 2017, IBM generated 37.8 billion U.S. dollars in global IT services revenue, making it the largest IT services company in the world in terms of net sales
• Only 8% of large companies use internet sales strategies. The proportion of companies relying on internet sales increases as company size decreases
• As with unit churn, companies with longer contracts (2+ years) tend to report lower annual dollar churn
• The 2015 median revenue growth rate was 44%, while the median projected growth rate for 2016 is 48%
• If a software company grows at 20% annually, it has a 92% chance of ceasing to exist within a few years
• If your Net Revenue Churn is high (above 2% per month) it is an indicator that there is something wrong in your business; this will become a major drag on growth
• All types of investment have grown, year-on-year, with the biggest growth during the seed stage of financing
• Revenue Churn Rate = (RCR) (MRR at beginning of month – MRR at end of month) – MRR in upgrades during month / MRR at beginning of month
• To generate a single dollar of new customer revenue, Field Sales strategies have an average Customer Acquisition Cost (CAC) of $1.14

SaaS & Tech Growth Strategy Stats

• Account Churn Rate (ACR) = customers at beginning of month – customers at the end of month / customers at beginning of month
• The median cost for a SaaS company to acquire a dollar of new customer revenue is $1.18
• Net-revenue churn improves with larger Average Contract Value (ACV), likely due to more structural churn among SMB customers and higher switching costs associated with larger contracts
• Only 8% of large companies use internet sales strategies. The proportion of companies relying on internet sales increases as company size decreases
• In 2017, the world invested around 3.4 billion U.S. dollars in small hydropower technologies, down from 3.9 billion U.S. dollars in 2016.
• In contrast to these, the median annual churn rate for smaller, private SaaS companies with less than $10M in revenue is 20%
• When determining Sales Capacity, “it’s worth noting that some percentage of new sales hires won’t meet expectations, so that should be taken into consideration when setting hiring goals. Typically we have seen failure rates around 25-30% for field sales reps, but this varies by company. The failure rate is lower for inside sales reps. can be counted as half of a productive rep”
• The average SaaS business generates 16% of its new Annual Contract Value (ACV) from upselling to existing customers
• In all SaaS businesses there will likely come a moment where they realize that not all customers are created equal