Running SaaS or Software as a Service is not just about setting it up. Ensuring that the software are optimised is just as important to make sure they are attractive and enable you to develop your activities. To do this, Internetvista also gives you several indicators to evaluate the performance of your SaaS. Before exploring these elements further, a brief definition can help to better understand the ins and outs of this type of application.
What is a SaaS application?
SaaS is a hosting system made available by providers to enable the distribution of applications via the Internet. This gives companies the advantage of no longer having to invest in software and other equipment necessary for its proper functioning. In the same way, they will no longer have to mobilise funds for the charges inherent in the cost of running their application. This includes the cost of software licences, installation costs and maintenance.
All they have to do is pay a subscription to their SaaS provider. And because the application is available online, it can be deployed instantly at no extra cost. Moreover, this subscription includes a range of software that varies according to the needs of the companies. This allows companies to manage their operating budget more easily. This range also affords them a certain flexibility with the possibility of suspending their subscription at any time.
Thanks to its set-up, SaaS is easily accessible from any connected device and on a permanent basis. This configuration also allows it to be used by thousands of users instantly. In addition, its update and patching is automatically handled by the provider, meaning companies do not need to invest in software. On the same note, there is no longer a need for an internal IT team.
What are the key indicators to steer a SaaS ? MRR, CLTV, ARR,…
The strategic information provided by these indicators allows you to better understand the weaknesses and strengths of your SaaS. In fact, the KPIs or key indicators allow professionals to evaluate the performance of their application. The relevance of this data then gives them the opportunity to direct their strategies accordingly. As a result, the question of the need for KPIs in the world of SaaS should no longer arise.
Among these key indicators, the Monthly Recurring Revenue or MRR allows you to calculate your monthly incoming revenue. With the new MRR, you can see how many new customers you have. While MRR growth provides you with information about the development of your existing customer base. A MRR decrease tells you how many customers have chosen to cancel their subscription (churn). The calculation of your annual recurring revenue (ARR) gives you an overview.
You can also glean information about the average revenue per account (ARPA). The Customer Lifetime Value (CLTV) gives you the possibility to estimate the added value that a customer generates for your company. It is also important to define the Customer Acquisition Cost (CAC) in order to measure the expenses invested in it. To do this, divide the total costs of your investments (marketing, business expenses, sales) by the number of new customers acquired.
Uptime and response time are also indicators to be taken into account
Other indicators such as uptime and response time are also important. The uptime is the measure of the availability of your SaaS. It is a ratio of its uptime to total time. To calculate your uptime, divide your uptime by your total time.
Did you know that an uptime of 99.99% is equivalent to a weekly downtime of more than 100 minutes? That is more than 7 hours over a period of one month or 87 hours of downtime over a year. This 99.99% rate is considered a «high availability» indicator. This is because SaaS can experience planned or unplanned downtime. Guaranteeing this rate of availability is important in order to safeguard your reputation. After all, all downtime means lost revenue!
Speaking of reputation, the response time of SaaS is also one of the essential indicators to keep in mind. It rightly highlights the performance of your application in terms of responsiveness to a customer’s request. If the user feels that they have to wait for quite a long time to access the information they are looking for, they will abandon your platform. This can have a negative impact on the acquisition of new customers or contribute to the churn of existing customers.
internetVista gives you the uptime + response time + page status
For various reasons, your SaaS may experience accessibility problems due to a crash or some other anomaly. In order to ensure the availability of your application, remote monitoring is necessary. This set-up will allow you to react quickly in case of a crash or other incident on your platform. To deal with this eventuality, internetVista provides you with a monitoring service in order to guarantee the smooth running of your SaaS.
This is a verification system carried out on a recurring basis and on an ad hoc basis. It provides you with various indicators such as the uptime, the response time of your application and the status of your page. This monitoring gives you access to usable reports for the analysis of your periodic performance (daily, weekly, monthly, annual). Depending on your objectives, you will have the opportunity to react accordingly and to take steps to successfully improve your performance.
To conclude, the performance of your SaaS will be based on different key performance indicators or KPIs that need to be closely monitored in order to adopt an effective response. Your ability to react will give you the opportunity to ensure the availability and accessibility of your application. These are satisfaction criteria that are highly appreciated by your customers, so it is in your interest to take them into special consideration. By making good use of these factors, you can also optimise your activities and shore up your reputation.