4 Crucial Metrics All SaaS Companies Must Track with Big Data

using SaaS with big data
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Big data is the lynchpin of the Software as a Service (SaaS) business model. Panoply, a big data innovator, has talked about a new model called Data as a Service, which is a variation of the same idea.

Big data is used at every junction of the SaaS model. Savvy companies will use it to track important KPIs to meet their goals.

SaaS Model Relies on Big Data Innovation

Tracking the right metrics is an important part of running a successful business. Big data is crucial for helping organizations achieve this goal. The Science and Information Organization talks about this in detail in one of their white papers written by Alazar Baharu.

When your company is offering software as a service, the need for tracking certain metrics becomes dire, and in this post, we are talking about those metrics.


Here you will read about four metrics that are super crucial for your SaaS business. We will also go into detail about the use of big data for meeting these needs.

So, are you ready? Cool, let’s get started.

1. Average Revenue Per Account (ARPA)

One of the most critical SaaS metrics — average revenue per account or commonly known as average revenue per customer (ARPC).  The main reason why this metric matters is because it helps companies identify the profits that they are making from every individual customer that is connected to them.

This is one of the ways that machine learning can be especially helpful. Machine learning helps organizations identify lost revenue opportunities and optimize accordingly.


So, the question comes. How to calculate this metric?

Well, just as the name suggests, the idea is to identify the average revenue that an organization is making out of its every customer. Still, for a better understanding, here’s the general formula.

Just keep in mind that there may also be some customers who may be using multiple accounts. So, if you can be sure about these customers and their different accounts, finding out the ARPA will be easier.

2. Lead Velocity Rate

And here comes another metric.


Lead velocity rate is the metric that helps you identify the growth percentage of qualified leads from month to month. The basic idea is to track your pipeline’s development, as in how many qualified potential customers your organization is currently trying to convert into actual customers.

Big data has helped companies track lead generation over time. They can use data analytics tools to identify independent variables that influence the number of leads a company earns, so they can maximize the number of leads per dollar spent.

This is one metric that helps you predict future revenue and growth.

Speaking of how to calculate lead velocity rate, here’s a general formula.


3. Customer Health Score

If you are constantly looking for new effective ways of driving ultimate customer success, measuring customer health score is important for your SaaS company.

Speaking of what this metric means, customer health score is a value that indicates the long-term chances of a customer to withdraw their subscription with you or become a high-value customer instead.

And coming to how your organization can track this, scores like this don’t come with a general formula that can work for everyone. The customer health score is best when customized based on the factors associated with the industry and the specific organization.

4. Product Engagement Score

And here comes another score. The product engagement score is the metric that tells you about the engagement quotient of your website and mobile apps.


The ability to engage appropriately with customers is of high value in 2020. It’s like, everyone is looking for a chance to be bored, and the moment they get it, they lose interest in your content, website or mobile app.

In times like these, it becomes crucial to track product engagement scores so you can work on the weak areas and make sure that your customers don’t lose interest easily.

To know more about how you can use this metric, it’ll be good to do some research around the idea of product experience and how you can use this for your SaaS.

Big Data is Key to SaaS Business Growth

Big data is vital to optimizing any business model. You need to make sure that you know what metrics to use to get the most value from your funnel. If you are running a SaaS business and are not sure about which metrics you must track for supporting your business’ desired growth, this post can help you.


Here, we talked about four important metrics that every SaaS company should track.


Hopefully, you enjoyed reading this and found this helpful.

Ryan Kh is an experienced blogger, digital content & social marketer. Founder of Catalyst For Business and contributor to search giants like Yahoo Finance, MSN. He is passionate about covering topics like big data, business intelligence, startups & entrepreneurship. Email: ryankh14@icloud.com