If you’ve been keeping up with this series, you’re well on your way to integrating a fully customizable embedded iPaaS into your SaaS offering in order to offer your customers a way to link the tools and technologies they know and love into your product–making your offering stand out, offer more to your existing customers, and better attract new ones.
Integrating an embedded iPaaS into your SaaS in this way will help you convert customers, but there are other ways to monitor its effectiveness. SaaS product metrics, otherwise known as key performance indicators (KPIs), are specific measurements that can be monitored to indicate the success or shortcomings of your solution.
Agreeing upon and measuring these metrics over time gives you invaluable insights that can inform the ongoing development of your product and make it even more appealing to your customer base. This is known as product-led growth strategy, whereby your chosen metrics–be they acquisition, expansion, conversion or retention numbers–are driven by the success of your SaaS.
By judging the success of your solution by the impact it is having on your users, you can get a better idea of its perceived performance versus its actual performance, and will be better equipped to close that gap.
In this blog we will outline core metrics that all SaaS product managers should be measuring to best gauge the success of their solution among users, as well as business metrics that can give clear insights around the impact your solution is having on growth, revenue and other business-critical goals.
1. Business Metric: Conversions
This entails looking at the various stages in your sales process and how they are aiding in converting potential customers and seeing which stages are generating the most signups–and which stages need to be reevaluated. For example, how many visitors are clicking on your signup form and how many are actually completing it? It sounds simple, but the insights from measuring your conversion funnel can help you drastically improve your customer onboarding.
2. Product Metric: Net Promoter Score (NPS)
NPS is a widely recognized metric for evaluating your customer’s perception of you, your product, and the value you are ultimately offering them. Used to delve into your SaaS product, this metric lets you see what features your customers are engaging with and which ones aren’t resonating with them.
By evolving your solution beyond its core abilities through a workflow automation system like Appmixer that enables sophisticated automated workflows and integrations with third-party applications you will be improving the value of your offering, better meeting the needs of your customers, and therefore will be likely to receive a higher NPS score from your satisfied customers.
3. Business Metric: Monthly Recurring Revenue (MRR)
Your customers’ MRR is perhaps the most important metric of all, as it is a clear indicator of how well they are performing on a monthly basis. Visualising MRR allows users to set specific goals, such as improving by 5% per quarter, or doubling their revenue over the course of a year.
4. Business Metric: Customer Acquisition Cost (CAC)
This looks at how much resource you are spending trying to convert new customers, and can be further enriched with specific context that relates to your individual KPIs. An example of this would be the time it takes you to make back the cost of acquiring a customer–a.k.a. the payback period–so you can better manage your spending and expectations relating to your cash flow.
That’s just one example, but it's better to look at a fully-weighted CAC where not only ad spend gets calculated, but also wages, spending on sales and marketing tools, and other costs are considered. Getting as insular as possible in your CAC calculations will give the best insight into exactly how much you’re spending to acquire a customer.
5. Product Metric: Active Users
Active users lets you understand how many users are engaging with your product on a hourly, daily, weekly or monthly basis, and is a healthy metric that directly correlates to the success of your offering. You can dive deeper here, analysing the number of users engaging with a specific feature or monitoring the adoption rate of a new feature.
6. Business Metric: Lifetime Value (LTV)
LTV gauges the overall value each customer brings to your business in terms of ongoing revenue. It’s hard to properly measure, but creating a reliable estimate around LTV lets you track changes over time and adjust your other strategies, such as customer outreach or support, in the long run.
7. Business Metric: Churn Rate
Perhaps the opposite to LTV, churn looks at how many users your customer is ‘churning’ over any given time period. A high churn rate is a red flag, and indicative of serious shortcomings in your customer offering. A low churn rate, on the other hand, is what all customer-focused businesses aim for, and shows that their customers are happy and settled with the service they are receiving.
Without an embedded tool such as Appmixer, your customers may turn to a provider who can offer integration and automation capabilities. This leads to dissatisfied customers turning away from your solution in favour of one that better meets their needs, leading to an increased customer churn rate.
Similarly, if your customer sees that you are meeting their needs via additional automation and integration features, they’ll be more likely to stick with your solution in the long run. Recent research proves that offering your customers an easy way to integrate with third-party applications and automate routine tasks can reduce churn rate by up to 40%.
These are just some of the business and product metrics all SaaS managers should be aware of, each of which can be tailored to reflect and monitor individual KPIs or wider business goals.
By integrating an embedded iPaaS into their platform, managers can upgrade their software to effectively present new features, which in turn makes them more valuable to their customer base. By offering customers even more than their standalone solution, SaaS companies will see positive impacts on the critical business metrics outlined in this article.
In turn, this will help you evolve and adapt your customer acquisition strategy, improve customer satisfaction and retention, and positively impact the future development of your SaaS.
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This has been the fourth blog in a six-part series on the benefits of white-label SaaS for MarTech and SalesTech vendors and the vital role of embedded integrations in helping them stand out from an increasingly saturated marketplace. Each blog will outline an essential step in white labelling, covering useful workflows, key automations, and practical advice on reselling white label services.
Keep an eye out for part five, which will showcase a successful embedded iPaaS implementation in action!
