If you want your B2B SaaS sales team to hit its goals, tracking the right metrics is essential. Think of it like guiding a rocket—accurate data keeps you on course, while bad numbers can throw you off track.
This article covers the metrics that matter and how they can improve your sales performance.
Sales Velocity
Sales velocity is one of the most useful metrics a B2B SaaS sales team can track. Simply put, it tells you how quickly deals are moving through your sales pipeline and, most importantly, how much revenue you’re generating over a specific period.
To calculate sales velocity, you’ll want to look at four key factors:
- Number of opportunities
- Average deal value
- Win rate
- Length of the sales cycle
A high sales velocity means your team is closing deals faster—a good sign that your sales process and B2B sales engagement strategies are working well.
If the number is low? You might need to pinpoint bottlenecks, like long follow-up times or poor prospect targeting.
Customer Acquisition Cost (CAC)
Customer Acquisition Cost (CAC) is exactly what it sounds like—the amount of money it takes to acquire a single customer.
This includes all the resources spent on marketing, sales, and other related efforts required to convert leads into paying customers.
For B2B SaaS businesses, CAC is a critical metric that should always be top of mind because it directly impacts profitability and the overall sustainability of the business. If your CAC is too high, you may struggle to see a return on investment.
Conversely, if your CAC is too low, it might mean you’re not investing enough in outreach, marketing, or building your brand awareness, which could limit your growth potential.
To calculate CAC effectively, break it down by evaluating all your expenses, including salaries for sales and marketing teams, ad campaigns, software tools, and any other associated costs.
Then, compare that total to the number of new customers you’re bringing in during the same period.
This analysis not only gives you a clear picture of how much you’re spending to acquire a customer but also highlights areas where you might improve efficiency or adjust your strategy.
Keeping a close eye on CAC will help you balance spending and customer growth, ensuring long-term success.
Monthly Recurring Revenue (MRR) and Annual Recurring Revenue (ARR)
Recurring revenue metrics such as MRR and ARR are lifelines for any B2B SaaS company. They answer one major question—how predictable is your revenue stream?
For subscription-based businesses, these metrics matter a whole lot more than one-time sales figures.
To take things a step further, break this metric down by types of revenue:
- New MRR shows how much revenue came from new customers.
- Expansion MRR tracks revenue growth from upselling or cross-selling to existing clients.
- Churned MRR highlights how much revenue you’ve lost from customers canceling.
Tracking these will help you figure out whether your team is signing the right kinds of deals and keeping existing customers happy.
Consistent growth in ARR and MRR is the hallmark of a scalable B2B SaaS business.
Pipeline Conversion Rate
Your sales pipeline conversion rate shows how many of your deals are successfully moving from one stage of the pipeline to the next. A strong pipeline conversion rate often goes hand-in-hand with solid B2B sales engagement strategies because it indicates that your team is connecting with the right people at the right time.
This metric can shine a spotlight on weak points. Are leads dropping off after initial contact? Or are negotiations dragging on too long? Tools like Yess AI — built to streamline workflows and automate follow-ups — can help optimize this process, so prospects don’t slip through the cracks. By tackling bottlenecks head-on, you’ll see a healthier, faster-moving pipeline.
Customer Lifetime Value (CLV)
CLV is a measure of the total amount of revenue a business can expect to generate from a single customer account. This includes not just initial purchases but also recurring revenue and any additional upsells or cross-sells over time.
Understanding CLV can help you make strategic decisions around marketing and customer retention efforts. For example, if your CLV is low, it may be worth investing in initiatives that focus on retaining current customers and increasing their lifetime value. On the other hand, a high CLV may indicate that your marketing efforts are successfully bringing in valuable customers and you can focus on acquiring more of them.
Churn Rate
Speaking of churn, this is another must-track metric for any B2B SaaS sales team. It measures the percentage of customers who cancel or don’t renew their subscriptions over a certain period of time.
Minimizing churn is crucial because keeping existing customers is far cheaper than finding new ones. A high churn rate can indicate issues with the product, customer service, or overall satisfaction.
To reduce churn, focus on providing excellent customer support and continuously improving your product to meet their needs. Regular check-ins and personalized communication can also go a long way in ensuring customer retention and reducing churn.
Sales Forecast Accuracy
Forecasting isn’t just for showing off at team meetings—it helps you allocate resources, schedule campaigns, and set realistic goals. Sales forecast accuracy measures just how close you came to your predicted revenue within a given timeframe.
This metric highlights how well your sales team understands the pipeline and the market. Get it wrong, and you might undershoot your goals or overspend. Invest in data analysis tools and focus on refining your team’s sales strategies to improve this metric over time.
Final Thoughts
While there are countless metrics that can be tracked in B2B SaaS sales, these five are essential for gaining a holistic understanding of your team’s performance and the health of your business.
By regularly tracking and analyzing these metrics, you can make data-driven decisions to drive growth and success.
Remember, it’s not just about hitting quotas and generating revenue, but also about continuously improving processes and building long-term relationships with valuable customers.
