2nd Annual SaaS Metrics Survey

September 2012

Powering the Customer Era

Table of Contents

1. Methodology …………………………………… 3

2. Analysis & Insights …………………………. 6

3. Survey Results ...................................... 11

Methodology

About Totango

Totango creates an Active and Engaged online user-base, resulting in

better Monetization and less churn

Totango manages over 2.1 million accounts for its customers

Research Methodology

Totango surveyed 134 executives at SaaS companies about the key performance indicators used to run their businesses. The same survey was also conducted in 2011 giving Totango unique insights into SaaS trends.

Analysis & Insights

2011 2012

61%

68%

68% of SaaS Executives are unhappy with the current metrics and methods available to measure SaaS business progress, which is up from 61% from last year.

1

57%

57% of SaaS Executives are planning to implement new Key Performance Indicators to better measure and manage their business in the next twelve months.

2

There is a shift towards customer centric measurements, designed to report on the success of existing customers: 5 out of the top 6 new Key Performance Indicators are customer metrics.

3

NPS

Upsell

Campaign performance

CLV

Churn

Product Usage Analysis

5%

8%

9%

13%

16%

39%

Number of new trial signups or free accounts

Conversion rates (free to paying)

Website unique visitors

68%

71%

74%

56%

59%

54%

2011 2012

SaaS companies are relying more and more on data and analytics to run their businesses and there is an increase in the use of metrics across the board.

4

+20%

+12%

+12%

Survey Data

Website unique visitors

Conversion rates (free to paying)

Product usage statistics

Number of new trial signups or free accounts

Churn rates

Revenues per user

Customer lifetime value

Account activation rate

Social media mentions

Upgrade and downgrade

Net Promoter Score (NPS)

74%

71%

69%

68%

63%

49%

48%

44%

31%

30%

18%

54%

59%

56%

56%

44%

31%

31%

21%

2011 2012

Question 1: Which metrics do you track (check all that apply)?

Social media

CAC

Word of mouth

MRR

NPS

Upsell

Campaign performance

CLV

Churn

Product Usage Analysis

1%

1%

3%

4%

5%

8%

9%

13%

16%

39%

Question 2: Which metrics do you plan to track in the future?

Question 3: What aspects of churn do you measure (all that apply)?

Annual retention/churn in % of the number of customers

Monthly steady-state churn

Annual retention/churn in % of revenues

Churn occurring in the first 90 days of a customer's life

50%

46%

36%

22%

Note: Even though a majority of SaaS companies rely on recurring revenues, less than half measure churn (no wonder CEOs are unhappy with their metrics).

Question 4: At what frequency are you reviewing these metrics?

Daily (or more)

Weekly

Monthly

Quarterly - once a quarter

Never

Varies

28%

31%

13%

1%

5%

21%

36%

36%

9%

4%

10%

5%

2011 2012

Question 5: How much are you growing revenues per user annually?

N/A 0-20% 21-40% 41-60% 61-80% Over 100%

49%

26%

11%8%

5%2%

Question 6: How happy are you with the state of your metrics?

Very pleased

Good enough

Not satisfied and invest on improving it

Not satisfied and learned to live with it

17%

14%

32%

37%

15%

25%

34%

27%

2011 2012

7%

22%

49%

22%

Scaling (first couple of years in revenue)

Mature

No revenue yet (we’re just starting)

Young (first year of revenue)

Question 7: What is the stage of your business?

51%

23%

20%

6%Subscription with free trial

Enterprise sales

Freemium

Other

Question 8: What is your business model?

Respondents by Title

Sales

Marketing

Customer Success

Product Management

CEO

Executive

R&D

Operations / Finance

IT

23%

22%

22%

17%

7%

5%

2%

2%

2%

Question 8: What is your title?

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