A comprehensive understanding of customers and accurate turnover planning requires information from several company’s departments. Revenue Operations must filter out the many potential indicators that create operational added value for the overall company.
Among other things, a subscription management solution is able to rely on existing financial and transactional data, in order to reproduce the following key indicators
- Monthly recurring revenue and annual recurring revenue
Monthly Recurring Revenue (MRR) — Annual Recurring Revenue (ARR)
MRR = Total number of customers × monthly rate
ARR = monthly rate × 12
Total number of customers
- Customer Lifetime Value
CLV = Average transaction value x Number of transactions × Customer retention rate
- Customer churn rate
Churn rate = Total number of churns
Total number of customers
- Renewal Rate
Renewal Rate = Number of subscriptions up for renewal
Total number of subscriptions to be renewed for the given period
