Conversions, leads and churn rate. Nick is the founder and CEO of Delmondo. He works with brands and startups improving their digital marketing and social media strategy, focusing on branded content. MORE
The Maximum Viable Churn Rate for a Startup. Yesterday I found out that Lean Analytics is now available in Polish! I’m still sort of amazed by it, so I figured I’d share it here with folks–and who knows, some of you may know Polish and be interested in analytics too. MORE
If a VC meets with 40 eCommerce companies and has the data room on all of them (downloaded on to his or her system) then when they DO finally dig in on an investment opportunity they can compare information such as CACs, LTVs, churn rates, margins, etc. MORE
What you’re experiencing is customer churn. What is customer churn? Also known as “customer churn,” customer attrition is the loss of clients or customers using your service. If you’re unsure, you can learn how to calculate your churn rate here. MORE
Calculating Your Customer Retention Rate. If you’ve been doing business longer than a few months pay attention to your customer retention rates. In order to calculate your customer retention rate you need to know: Number of customers at the end of the period – E. MORE
A thoughtful analysis of the economics of price, cost, and churn across SaaS vendors. The decision on which distribution strategy to employ weighs heavily on choices made on price, cost of acquisition, sales & marketing expenses, and churn rates. MORE
Customer happiness is the lifeblood of any business — after all, happy customers mean lower churn rates, increased word-of-mouth marketing, a boost for internal morale, and so much more. by Allison Yount, Director of Customer Success at Scout RFP. MORE
Your churn rates are too high. You Need to Find Your Mojo A Chip On Your Shoulder A few years ago I wrote a blog post on entrepreneurs with a chip on their shoulders. I think it’s an important read. MORE
Churn and Churn Rate. Churn is the number of customers that cancel your service in a given month – when they leave, they’ve “churned out” and are no longer subscribing to your service. Churn rate is the percentage of customers that leave every month. MORE
These metrics can be obtained through analysing a conversion rate. Another kind of metric in this group is the churn rate which shows all the losses, e.g. in revenue, customers, etc. by Beata Green, Director of HeadChannel. MORE
“With attrition rates for many apps so high, reducing your churn rate can boost growth as much as increasing the number of people who download your app.” - Why Engagement Trumps Growth (via datainsightsideas ). In other words, ignore churn at your own considerable risk…. SaaS mobile mobile apps churn metrics business attrition rates MORE
especially about churn rates and your high CACs last quarter relative to the previous year. You had an amazing meeting with an investor. Your product demo crushed. The dialog was great. They told you how much they loved your space. MORE
Reduce churn. Churn is essentially your cancellation rate. The percentage of your paying customers that cancel is your churn rate. Obviously, a lower churn rate is better. Improve signup rates. MORE
There are various reasons as to why fast-growing startups spend time monitoring their customer success rate. But the major reason they do it is because they have experienced and survived what we call a company killing churning crisis. When customer churn spikes, it creates a panic. MORE
This principle would increase conversion rates from prospects and maximize penetration rates withing current customers. Business Insights customer acquisition cost Customer Life Time Value Customer value Increase Conversion Rate penetration rate potential buyer Response MORE
Are they staying with your products/services for a long time or using for a short time and leaving (this is called “churn”). A churn rate is the percent of customers who terminate their relationships with your company in a specific period (a month, for example). MORE
StartupCFO , May 6, 2010 Great look at important metrics for SaaS and the importance of churn rate Continuing my series of posts that I’ve been collecting that live at the intersection of Startups, Startup Development and being a Startup CTO. Here are a couple of the other collections: 16 Great Startup Posts from March , Startup CTO Top 30 Posts for April. MORE
One simple way to calculate customer lifetime value is average monthly spend per customer divided by monthly customer churn rate. So in this example, if the business could cut churn rate in half to 5 percent, it would double its customer lifetime value. MORE
Totango SaaS Executive Dashboard captures the current SaaS best practices around monitoring customer engagement and customer success and tracks visitors, signups, activations, conversions and your SaaS churn rate. MORE
The biggest driver for high LTV is repeat purchase behavior (in an e-commerce business) respectively a low churn rate (in a SaaS company). In addition, churn tends to rise as a company grows. News $100 million Churn rate e-commerce Facebook LTV marketplaces network effects Software as a service viral coefficient Viral marketing Zynga MORE
More importantly, a subscription business model enables you to manage the cash flow, upgrade your business planning and optimize metrics such as churn rates, the lifetime value of a customer, expansion, and more. by Stefan Pretty, founder of Subbly. MORE
And of course, you have a retention assumption (1/ churn rate) for how much of your existing revenue you keep. Update your assumptions (key drivers in a model should always be on a separate and easy to update assumptions tab) to show the conversion rates that you experienced last year. Running last year’s traffic with the related conversion rates, ARPU and other key assumptions should replicate the new revenue you added last year. MORE
“At current churn rate, 75% of the S&P 500 will be replaced by 2027.” - Innosight. Creative Destruction Whips Through Corporate America ” (via peterspear ) Or as I would state, the evidence of a healthy economy. economy innovation creative destruction business s&p500 MORE
And they realized that the use of the Tidepool software could reduce the device companies’ customer churn rate by at least 1%. We talk a lot about Customer Development, but there’s nothing like seeing it in action to understand its power. MORE
That’s why fixed rate mortgages cost more than variable. Assuming you have low churn rates (the rate at which subscribers cancel), you begin each month, quarter or year already knowing what a good portion of your revenue will be. Its human nature to place a premium on certainty. Its also why we buy insurance and other items to manage risk. We just want peace of mind. MORE
You can find the full 2017 survey results here: Part 1 shares growth rates, go-to-market trends and cost structure Part 2 covers application delivery methods, operational costs, gross margins, contract terms, churn rates, capital requirements and accounting methods. The third annual forEntrepreneurs SaaS Survey Infographic shares top highlights from this year’s SaaS Survey results! MORE
CAC and payback period are key inputs into the financial model which works out how much cash a company will burn each month at a given growth rate, and therefore whether a company can get past key revenue milestones before they need to raise their next round. MORE
Conventional wisdom suggests that the most important metrics for a startup - such as unit economics, cost of acquisition, lifetime value, churn rates - typically get better with time. Take growth rate as a simple one. Churn rates are another metric that can get harder with scale. MORE
Churn Rate. But many first time SaaS merchants overlook churn or don’t even know what churn is. We will explore the ins and outs of churn and tell you how to fight it. What is churn rate? In a perfect world, churn wouldn’t exist. MORE
Following Lincoln Murphy’s post on SixteenVentures.com (talking about conversion average rate for free trials, pricing pages or Freemium for SaaS or Web Apps), conversion rate average figures will do no good, as it doesn’t reflect the whole picture and usually lacking context. MORE
We worked together with Pacific Crest, an investment banking firm with a specific focus on SaaS, to survey 155 SaaS companies on a variety of topics such as growth rates, CAC (cost to acquire a customer), gross margins, churn rates, etc. Business Model SaaS CAC churn MORE
High churn rates. High return rates. High referral rates. When I wrote last night about Growing the right way I said that startups should aim to grow sustainably. MORE
Reducing churn rate. So you can more safely worry about fewer metrics on an eCommerce site, like increasing AOV or conversion rate (not that it’s easy to increase these). However it comes with its own set of challenges, like retention and churn. Churn. MORE
This week we’re talking about activation, retention and its polar opposite – churn. As you will see, churn and retention are the most important metrics to the long-term success of a SaaS business. Churn is the % of users / customers that abandon the service over time. MORE
On the flip side of engagement, we can look at churn as a measure of the number of individuals moving out of a collective group over a specific period of time. Churned users can be segmented as follows: Total Churned Users = New Churned Users + Old Churned Users. MORE
It may include profitability, but it more likely will focus on increasing growth, or reducing churn rate, or driving up engagement, or driving revenue, or any number of other possible goals. One question that I continue to get from many company leaders is whether or not product managers should be given P&L responsibility for their products. MORE
This week we dive into the results from Part 2 of the survey where we compare application delivery methods, operational costs and gross margins, contract terms, churn rates, capital requirements and accounting […]. Last week I shared the results from Part 1 of our survey in which 300+ SaaS companies shared data on their growth and go-to-market strategies. MORE
Building for Success SaaS Sales & Marketing Machine Startup Help churn churn rate Cost of Customer Acquisition customer engagement SaaS business SaaS churn SaaS churn rate SaaS customer engagement saas marketing SaaS sales SaaS VCThe goal of a SaaS CEO should be to increase the profit they make from each customer (LTV), and lower the costs in sales and marketing that it takes to acquire each customer (CAC). MORE
But it’s surprising to me how many companies with recurring/subscription revenue don’t understand the interactions between the elements that make up customer acquisition cost (CAC), churn and lifetime value (LTV). (Guest post by Gordon Daugherty. MORE
Since I see a few common patterns of mistakes, I thought I'd add to the LTV literature and point out the top three reasons many investors roll their eyes when they see entrepreneurs present inflated, poorly constructed LTVs: 1) Your churn rate is understated. A monthly churn rate of 1%? MORE
But if you don’t – now you have many cynical VCs lining up critiquing your CAC/LTV ratios, your churn rates, your poor performing cohorts. VC funding. Our perspectives on the topic wax and wane with market cycles. MORE
This week I’m sharing the results from Part 2 of the survey where we compare application delivery methods, operational costs and gross margins, contract terms, churn rates, capital requirements and accounting methods. Last week I posted the results from Part 1 of our survey in which 300+ SaaS companies shared data on their growth and go-to-market strategies. MORE
One of these was around churn – he asserted that one of the clear weaknesses of the business was the high churn rate. He didn’t have a high churn rate at all – in fact, his churn rate after a customer was paying for three months was minimal. Instead of articulating a powerful story about low customer acquisition costs with minimal downstream churn, he lead with “the worst problem with the business is our high churn rate.” MORE
Churn Rate Related Topics 
YoungUpstarts
APRIL 5, 2013
Churn Rate. But many first time SaaS merchants overlook churn or don’t even know what churn is. We will explore the ins and outs of churn and tell you how to fight it. What is churn rate? In a perfect world, churn wouldn’t exist.
Mark Birch
JANUARY 15, 2014
“At current churn rate, 75% of the S&P 500 will be replaced by 2027.” - Innosight. Creative Destruction Whips Through Corporate America ” (via peterspear ) Or as I would state, the evidence of a healthy economy. economy innovation creative destruction business s&p500
Mark Birch
JANUARY 7, 2014
“With attrition rates for many apps so high, reducing your churn rate can boost growth as much as increasing the number of people who download your app.” - Why Engagement Trumps Growth (via datainsightsideas ). In other words, ignore churn at your own considerable risk…. SaaS mobile mobile apps churn metrics business attrition rates
For Entrepreneurs
SEPTEMBER 19, 2011
Building for Success SaaS Sales & Marketing Machine Startup Help churn churn rate Cost of Customer Acquisition customer engagement SaaS business SaaS churn SaaS churn rate SaaS customer engagement saas marketing SaaS sales SaaS VCThe goal of a SaaS CEO should be to increase the profit they make from each customer (LTV), and lower the costs in sales and marketing that it takes to acquire each customer (CAC).
Guy Nirpaz
SEPTEMBER 14, 2011
Following Lincoln Murphy’s post on SixteenVentures.com (talking about conversion average rate for free trials, pricing pages or Freemium for SaaS or Web Apps), conversion rate average figures will do no good, as it doesn’t reflect the whole picture and usually lacking context.
For Entrepreneurs
SEPTEMBER 4, 2013
We worked together with Pacific Crest, an investment banking firm with a specific focus on SaaS, to survey 155 SaaS companies on a variety of topics such as growth rates, CAC (cost to acquire a customer), gross margins, churn rates, etc. Business Model SaaS CAC churn
Seeing Both Sides
OCTOBER 24, 2015
Since I see a few common patterns of mistakes, I thought I'd add to the LTV literature and point out the top three reasons many investors roll their eyes when they see entrepreneurs present inflated, poorly constructed LTVs: 1) Your churn rate is understated. A monthly churn rate of 1%?
For Entrepreneurs
OCTOBER 29, 2015
This week I’m sharing the results from Part 2 of the survey where we compare application delivery methods, operational costs and gross margins, contract terms, churn rates, capital requirements and accounting methods. Last week I posted the results from Part 1 of our survey in which 300+ SaaS companies shared data on their growth and go-to-market strategies.
For Entrepreneurs
OCTOBER 22, 2014
This week we dive into the results from Part 2 of the survey where we compare application delivery methods, operational costs and gross margins, contract terms, churn rates, capital requirements and accounting […]. Last week I shared the results from Part 1 of our survey in which 300+ SaaS companies shared data on their growth and go-to-market strategies.
Up and Running
OCTOBER 3, 2014
Churn and Churn Rate. Churn is the number of customers that cancel your service in a given month – when they leave, they’ve “churned out” and are no longer subscribing to your service. Churn rate is the percentage of customers that leave every month.
Feld Thoughts
MARCH 10, 2012
One of these was around churn – he asserted that one of the clear weaknesses of the business was the high churn rate. He didn’t have a high churn rate at all – in fact, his churn rate after a customer was paying for three months was minimal. Instead of articulating a powerful story about low customer acquisition costs with minimal downstream churn, he lead with “the worst problem with the business is our high churn rate.”
The Next Web
FEBRUARY 21, 2015
Conversions, leads and churn rate. Nick is the founder and CEO of Delmondo. He works with brands and startups improving their digital marketing and social media strategy, focusing on branded content.
Mark Birch
JUNE 17, 2013
A thoughtful analysis of the economics of price, cost, and churn across SaaS vendors. The decision on which distribution strategy to employ weighs heavily on choices made on price, cost of acquisition, sales & marketing expenses, and churn rates.
Instigator Blog
JANUARY 31, 2014
The Maximum Viable Churn Rate for a Startup. Yesterday I found out that Lean Analytics is now available in Polish! I’m still sort of amazed by it, so I figured I’d share it here with folks–and who knows, some of you may know Polish and be interested in analytics too.
Both Sides of the Table
MAY 9, 2018
especially about churn rates and your high CACs last quarter relative to the previous year. You had an amazing meeting with an investor. Your product demo crushed. The dialog was great. They told you how much they loved your space.
A Smart Bear: Startups and Marketing for Geeks
FEBRUARY 11, 2014
But it’s surprising to me how many companies with recurring/subscription revenue don’t understand the interactions between the elements that make up customer acquisition cost (CAC), churn and lifetime value (LTV). (Guest post by Gordon Daugherty.
SoCal CTO
MAY 18, 2010
StartupCFO , May 6, 2010 Great look at important metrics for SaaS and the importance of churn rate Continuing my series of posts that I’ve been collecting that live at the intersection of Startups, Startup Development and being a Startup CTO. Here are a couple of the other collections: 16 Great Startup Posts from March , Startup CTO Top 30 Posts for April.
The Startup Magazine
MAY 22, 2018
There are various reasons as to why fast-growing startups spend time monitoring their customer success rate. But the major reason they do it is because they have experienced and survived what we call a company killing churning crisis. When customer churn spikes, it creates a panic.
The Equity Kicker
SEPTEMBER 29, 2016
CAC and payback period are key inputs into the financial model which works out how much cash a company will burn each month at a given growth rate, and therefore whether a company can get past key revenue milestones before they need to raise their next round.
YoungUpstarts
DECEMBER 4, 2017
Customer happiness is the lifeblood of any business — after all, happy customers mean lower churn rates, increased word-of-mouth marketing, a boost for internal morale, and so much more. by Allison Yount, Director of Customer Success at Scout RFP.
Inc Startups
AUGUST 28, 2013
One simple way to calculate customer lifetime value is average monthly spend per customer divided by monthly customer churn rate. So in this example, if the business could cut churn rate in half to 5 percent, it would double its customer lifetime value.
Both Sides of the Table
MAY 19, 2018
If a VC meets with 40 eCommerce companies and has the data room on all of them (downloaded on to his or her system) then when they DO finally dig in on an investment opportunity they can compare information such as CACs, LTVs, churn rates, margins, etc.
Steve Blank
DECEMBER 2, 2013
And they realized that the use of the Tidepool software could reduce the device companies’ customer churn rate by at least 1%. We talk a lot about Customer Development, but there’s nothing like seeing it in action to understand its power.
The Equity Kicker
SEPTEMBER 26, 2013
High churn rates. High return rates. High referral rates. When I wrote last night about Growing the right way I said that startups should aim to grow sustainably.
StartupCFO
JANUARY 5, 2016
And of course, you have a retention assumption (1/ churn rate) for how much of your existing revenue you keep. Update your assumptions (key drivers in a model should always be on a separate and easy to update assumptions tab) to show the conversion rates that you experienced last year. Running last year’s traffic with the related conversion rates, ARPU and other key assumptions should replicate the new revenue you added last year.
StartupCFO
SEPTEMBER 30, 2011
This week we’re talking about activation, retention and its polar opposite – churn. As you will see, churn and retention are the most important metrics to the long-term success of a SaaS business. Churn is the % of users / customers that abandon the service over time.
Up and Running
JULY 27, 2016
Reduce churn. Churn is essentially your cancellation rate. The percentage of your paying customers that cancel is your churn rate. Obviously, a lower churn rate is better. Improve signup rates.
ConversionXL
SEPTEMBER 13, 2017
What you’re experiencing is customer churn. What is customer churn? Also known as “customer churn,” customer attrition is the loss of clients or customers using your service. If you’re unsure, you can learn how to calculate your churn rate here.
ConversionXL
NOVEMBER 15, 2016
Reducing churn rate. So you can more safely worry about fewer metrics on an eCommerce site, like increasing AOV or conversion rate (not that it’s easy to increase these). However it comes with its own set of challenges, like retention and churn. Churn.
Seeing Both Sides
FEBRUARY 9, 2015
Conventional wisdom suggests that the most important metrics for a startup - such as unit economics, cost of acquisition, lifetime value, churn rates - typically get better with time. Take growth rate as a simple one. Churn rates are another metric that can get harder with scale.
YoungUpstarts
AUGUST 24, 2017
More importantly, a subscription business model enables you to manage the cash flow, upgrade your business planning and optimize metrics such as churn rates, the lifetime value of a customer, expansion, and more. by Stefan Pretty, founder of Subbly.
Version One Ventures
SEPTEMBER 28, 2015
On the flip side of engagement, we can look at churn as a measure of the number of individuals moving out of a collective group over a specific period of time. Churned users can be segmented as follows: Total Churned Users = New Churned Users + Old Churned Users.
YoungUpstarts
AUGUST 2, 2016
These metrics can be obtained through analysing a conversion rate. Another kind of metric in this group is the churn rate which shows all the losses, e.g. in revenue, customers, etc. by Beata Green, Director of HeadChannel.
Guy Nirpaz
OCTOBER 3, 2011
This principle would increase conversion rates from prospects and maximize penetration rates withing current customers. Business Insights customer acquisition cost Customer Life Time Value Customer value Increase Conversion Rate penetration rate potential buyer Response
crowdSPRING Blog
JANUARY 18, 2016
Are they staying with your products/services for a long time or using for a short time and leaving (this is called “churn”). A churn rate is the percent of customers who terminate their relationships with your company in a specific period (a month, for example).
Both Sides of the Table
AUGUST 20, 2015
But if you don’t – now you have many cynical VCs lining up critiquing your CAC/LTV ratios, your churn rates, your poor performing cohorts. VC funding. Our perspectives on the topic wax and wane with market cycles.
Both Sides of the Table
MAY 7, 2016
Your churn rates are too high. You Need to Find Your Mojo A Chip On Your Shoulder A few years ago I wrote a blog post on entrepreneurs with a chip on their shoulders. I think it’s an important read.
ConversionXL
MARCH 5, 2014
Calculating Your Customer Retention Rate. If you’ve been doing business longer than a few months pay attention to your customer retention rates. In order to calculate your customer retention rate you need to know: Number of customers at the end of the period – E.
SVPG
AUGUST 10, 2014
It may include profitability, but it more likely will focus on increasing growth, or reducing churn rate, or driving up engagement, or driving revenue, or any number of other possible goals. One question that I continue to get from many company leaders is whether or not product managers should be given P&L responsibility for their products.
StartupCFO
MAY 28, 2010
That’s why fixed rate mortgages cost more than variable. Assuming you have low churn rates (the rate at which subscribers cancel), you begin each month, quarter or year already knowing what a good portion of your revenue will be. Its human nature to place a premium on certainty. Its also why we buy insurance and other items to manage risk. We just want peace of mind.
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