Customer Acquisition Cost (CAC)
The total cost of acquiring a new customer, including marketing, sales, and related overhead. Understanding CAC is essential for sustainable growth.
Explore 25 business metrics and KPIs. Learn what to track, how to calculate, and which apps can help.
The total cost of acquiring a new customer, including marketing, sales, and related overhead. Understanding CAC is essential for sustainable growth.
The total revenue a business can expect from a single customer account throughout their entire relationship. LTV helps determine how much to invest in customer acquisition.
The percentage of revenue remaining after deducting the cost of goods sold (COGS). It shows how efficiently a company produces its goods or delivers its services.
The rate at which a company spends its cash reserves before generating positive cash flow. Critical for startups to monitor runway.
The amount of time a company can continue operating at its current burn rate before running out of cash. Essential for survival planning.
The percentage of visitors or leads that complete a desired action, such as making a purchase or signing up. The most important efficiency metric for online businesses.
The number of months required to recover the cost of acquiring a customer. Shorter payback means faster reinvestment in growth.
The net amount of cash moving in and out of a business. Positive cash flow means more money coming in than going out—essential for survival.
The ratio of Daily Active Users to Monthly Active Users. Measures product stickiness and how often users return to your product.
The ratio of Customer Lifetime Value to Customer Acquisition Cost. The fundamental unit economics metric that determines if growth is sustainable.
The percentage change in a key metric (usually revenue or users) from one month to the next. The fundamental growth tracking metric.
The predictable revenue a business expects to receive every month from active subscriptions. MRR is the foundation metric for subscription businesses.
The annualized value of recurring subscription revenue. ARR projects your MRR over a 12-month period and is commonly used for businesses with annual contracts.
The average revenue generated per user or customer account over a specific period. A key metric for pricing strategy and growth planning.
The percentage of customers or revenue lost over a specific period. Churn is the silent killer of subscription businesses.
The percentage of recurring revenue retained from existing customers over a period, including expansions, contractions, and churn. NRR above 100% means you grow even without new customers.
Total revenue divided by the number of full-time employees. A measure of workforce productivity and operational efficiency.
The ratio of revenue growth to revenue loss. Shows how efficiently a company is growing relative to its churn. Not to be confused with the accounting quick ratio.
The percentage of revenue remaining after all expenses, including operating costs, interest, and taxes. The ultimate measure of profitability.
A customer loyalty metric measuring likelihood to recommend on a scale of 0-10. Calculated as percentage of promoters minus detractors.
A benchmark stating that a SaaS company's growth rate plus profit margin should exceed 40%. Balances growth against profitability.
The percentage of sales opportunities that convert to closed deals. A key indicator of sales team effectiveness and product-market fit.
The average amount spent each time a customer places an order. AOV is a key metric for e-commerce and retail businesses.
The percentage of available working hours that are spent on billable client work. Critical for service businesses to maximize revenue per employee.
The profit margin on individual projects after accounting for direct labor and expenses. Essential for service businesses to ensure profitable work.