The 3 Must-Track SaaS Marketing Metrics: CAC, MRR, and Customer Churn Rate

As a SaaS marketer, it’s essential to track the right metrics and KPIs to ensure your marketing efforts are driving growth and success for your business. But with so many metrics to choose from, it can be overwhelming to know which ones to focus on.

In this blog post, we’ll take a deep dive into the top three KEY SaaS marketing metrics that every business should track: Customer Acquisition Cost (CAC), Monthly Recurring Revenue (MRR), and Customer Churn Rate.

By understanding and tracking these key metrics, you’ll be able to gauge the effectiveness of your marketing strategy and make informed decisions to drive growth and success for your SaaS business. So let’s get started!

Customer Acquisition Cost (CAC)

First up on our list is the oh-so-important Customer Acquisition Cost (CAC). This metric measures the cost of acquiring a new customer, and is calculated by dividing the total cost of your marketing and sales efforts by the number of new customers acquired during a given period.

Why is CAC so important? Well, for starters, it helps you understand how much you’re spending to acquire each new customer, which can be crucial for setting budgets and forecasting revenue. Plus, tracking CAC over time can help you identify trends and adjust your marketing strategy accordingly. For example, if you notice that your CAC is increasing, it could be a sign that you need to rethink your marketing tactics or adjust your pricing.

How to calculate your Customer Acquisition Cost

To calculate CAC, divide the total cost of your marketing and sales efforts by the number of new customers acquired during a given period. For example, if you spend $1,000 on marketing and sales efforts and acquire 10 new customers, your CAC would be $100.

Monthly Recurring Revenue (MRR)

MRR is the amount of revenue you can expect to generate each month from your subscription-based SaaS business. This metric can be calculated by taking the total number of paying customers and multiplying it by the average revenue per customer per month.

Why is MRR important? Well, for one, it helps you understand the current state and potential growth of your business. It can also be useful for setting sales targets and forecasting revenue. Plus, tracking MRR over time can help you identify trends and adjust your marketing strategy accordingly. For example, if you notice that your MRR is increasing, it could be a sign that your pricing and product offering are on the right track.

How to calculate your Monthly Recurring Revenue

To calculate MRR, take the total number of paying customers and multiply it by the average revenue per customer per month. For example, if you have 100 paying customers and the average revenue per customer per month is $100, your MRR would be $10,000.

Customer Churn Rate

Last but not least, we have Customer Churn Rate, which is the percentage of customers who stop using your product or service over a given period. This metric can be calculated by dividing the number of customers who churned by the total number of customers at the beginning of the period.

Why is Customer Churn Rate important? Well, let’s face it, nobody likes losing customers. And tracking your churn rate can help you identify potential issues and take steps to retain your existing customers. For example, if you notice that your churn rate is increasing, it could be a sign that you need to improve your product, offer better customer support, or address other pain points that are causing customers to leave.

How to calculate your Customer Churn Rate

To calculate Customer Churn Rate, divide the number of customers who churned by the total number of customers at the beginning of the period. For example, if you had 100 customers at the beginning of the month and 10 of them churned, your Customer Churn Rate would be 10%.


So there you have it, folks โ€“ the top three KEY SaaS marketing metrics that you absolutely must track to ensure your marketing strategy is on point. Of course, there are plenty of other metrics you could track, but if you focus on these three, you’ll be well on your way to SaaS marketing success! Now go forth and conquer the world of metrics (Or at least your marketing)!