Glossary terms related to SaaS in Sales.
Activation Rate measures the percentage of new users who complete key onboarding actions, indicating product engagement.
Annual Contract Value (ACV) represents the average yearly revenue generated from a contract, excluding one-time fees.
Annual Recurring Revenue (ARR) represents the total expected revenue from subscriptions over a full year, based on MRR.
Customer Acquisition Cost (CAC) is the total cost of acquiring a new customer, including marketing and sales expenses.
Churn Rate measures the percentage of customers who cancel their subscriptions within a given period.
Cross-selling involves offering complementary products or services to existing customers to maximize customer value.
Customer Expansion Rate reflects revenue growth from existing customers through upgrades, add-ons, and expanded usage.
Customer Health Score is a metric used to predict customer retention and expansion based on engagement, usage, and satisfaction.
Customer Payback Period is the time it takes to recover the cost of acquiring a customer through their revenue contributions.
Deal Size refers to the average revenue generated per closed sale, influencing overall sales performance and forecasting.
Demo Conversion Rate measures the percentage of product demos that lead to successful conversions into paying customers.
Expansion MRR tracks the additional monthly recurring revenue generated from existing customers via upsells or add-ons.
Expansion Revenue refers to additional revenue generated from existing customers through upsells, cross-sells, or add-ons.
Freemium Conversion Rate tracks how many free-tier users upgrade to a paid plan, a key metric for SaaS growth.
Lead Scoring assigns numerical values to potential customers based on their likelihood to convert into paying users.
Lead Velocity Rate (LVR) tracks the month-over-month growth rate of qualified leads to measure pipeline momentum.
Logo Retention measures the percentage of customers retained over a given period, without considering revenue fluctuations.
Customer Lifetime Value (LTV) estimates the total revenue a business can expect from a single customer throughout their relationship.
Monthly Recurring Revenue (MRR) is the predictable revenue a business earns each month from subscriptions, excluding one-time fees.
Net Revenue Retention (NRR) measures revenue growth from existing customers, accounting for expansion, downgrades, and churn.
Payback Period is the time it takes for a business to recover its customer acquisition costs (CAC) through revenue.
Pipeline Coverage refers to the ratio of open sales opportunities to quota targets, helping sales teams forecast revenue.
Quota Attainment measures the percentage of a sales rep's quota that has been achieved in a given period.
Sales Cycle Length is the average time it takes from the first contact with a prospect to closing a sale.
Sales Efficiency evaluates the revenue generated per dollar spent on sales and marketing efforts.
Sales Velocity calculates how quickly revenue is generated by measuring deal value, conversion rate, and sales cycle length.
Total Contract Value (TCV) is the total revenue expected over the lifetime of a contract, including recurring and one-time charges.
Upselling is the practice of encouraging customers to purchase a higher-tier plan or additional features to increase revenue.
Win Rate measures the percentage of sales opportunities that result in a closed deal, indicating sales effectiveness.
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