More than 1/2 of SAAS companies increased their spending on customer retention last year

SaaS + Software
Statistic in SaaS & Tech Growth Strategy

Statistic Info

Annual trends suggest that metrics such as customer retention cost, customer health, and customer lifetime value are the next big metrics respondents plan to track. Which Metrics Do You Plan To Track? Customer acquisition cost Conversion rates (free to paying) # of new trial or free signups Website unique visitors Customer retention cost Customer health Customer Lifetime Value (CLV) Net Promoter Score (NPS)

Totango

More SaaS + Software Stats

A 2017 SaaS Capital survey showed that young companies actually have higher retention rates than more mature SaaS businesses

Between the SMB and Enterprise customer types, the top-quartile performers not only have net-revenue churn that is 14% to 23% percentage less than the average performers but also have net-revenue churn that is negative in an absolute sense

SaaS organizations are now operating in over 100 countries

It’s 9x cheaper to retain existing customers than acquire new customers: costing $0.13 to acquire any additional dollar of revenue

Growth rate accelerates in the expansion stage ($2.5M – $10M ARR)

Since churn is so important, wouldn’t it be useful if we could predict in advance which customers were most likely to churn?

SAAS companies that are focused mainly on enterprise sales have higher levels of professional services

The median SaaS business loses about 10% of its revenue to churn each year and that works out to about 0.83% revenue churn a month

SaaS, and other recurring revenue businesses are different because the revenue for the service comes over an extended period of time (the customer lifetime)

How To Make Pricing A Constant Process In Your Organization

More SaaS & Tech Growth Strategy Stats

26% of SAAS companies with at least $15MM in 2015 GAAP revenue had a revenue growth rate + EBITDA margin of 40% or higher

The best SAAS businesses have a LTV to CAC ratio that is higher than 3, sometimes as high as 7 or 8

The average SaaS company spends just 6 hours determining their pricing strategy

The statistic shows the worldwide IT spending on enterprise software from 2009 to 2020.

If your Net Revenue Churn is high (above 2% per month) it is an indicator that there is something wrong in your business

If your Net Revenue Churn is high (above 2% per month) it is an indicator that there is something wrong in your business; which may have a dramatically negative effect on your company’s growth. Source: Mckinsey

In 2018, the global tech spending is forecast to amount to 3,212 billion U.S. dollars.

In contrast to these, the median annual churn rate for smaller, private SaaS companies with less than $10M in revenue is 20%

High-growth companies offer a return to shareholders 5 times greater than medium-growth companies

The median SaaS business generates 16% of its new Annual Contract Value (ACV) from upselling to existing customers

Looking for SaaS focused services?
SaaS Website Design
SaaS SEO Agency
SaaS PPC