There are certain metrics that a subscription business lives and dies by. For example…
Monthly Average Revenue Per User (ARPU)
Monthly Subscriber Churn Percent (or simply “churn”)
Customer Acquisition Cost (CAC); also known as CPA or SAC
Subscriber Lifetime Value (LTV); also known as CTV or TLV
Growth Margin Percent
…and a handful of others. These metrics and the data behind them are the objective, quantifiable, irrefutable expression of the health and vigor of your business.
They are the proof points demonstrating whether things are trending decidedly upward or discouragingly downward. Knowing what these numbers are, how they’re calculated, and what they mean are the keys to making to ensuring that your subscription business is healthy and profitable. TechCrunch recently published an excellent post on the key metrics a subscription business should track, how to calculate them, and what your resulting numbers mean in terms of your business’s revenue and profitability. We wanted to share this article with you because these are genuinely important metrics. We know, because we’re a subscription biller too. And because when our customers succeed, we succeed.
Click here to read TechCrunch’s article, “Easily Measure the Profitability of Your Consumer Subscription Business.”