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Companies, organizations, enterprises, large, or small businesses—it doesn’t matter which category you belong to; paying close attention to your customers is essential to the success of your business.
If you want to understand and meet the needs of your customers, a customer retention dashboard and its associated metrics will help you monitor, analyze, and manage multiple customer-centric points while showing you how they echo in your business.
Customer retention metrics are especially powerful in the SaaS & B2B arena, where different packages and subscription models have immense value in defining the quality of the company, the possibility to establish itself on the market, and the chance to generate sustainable development.
To help you understand the value of retention metrics, we will look at the modern customer retention dashboard and KPIs in detail. We will also explore reports created with dashboard tools and delve deep while considering why a customer retention dashboard is so important in today’s digital world.
Let’s get started.
What Is a Customer Retention Dashboard?
A customer retention dashboard is a visual tool used to track key customer-centric metrics such as retention rate, churn rates, MRR growth, and the number of loyal customers. That way, a business generates detailed insights about its health and growth opportunities.
To reach success in our competitive environment, businesses must put customers first. This notion is not only important for SaaS companies but also in the B2C area such as online shops. While we will focus our examples on the B2B SaaS businesses, each company, no matter the size or business model, should focus its efforts on retaining clients, and continuously optimizing the customer retention analysis process in order to save time and money. It's a known fact that acquiring new customers can be expensive, therefore, customer retention metrics shouldn't be disregarded but, on the contrary, monitored regularly. A professional dashboard maker can help in the process, but let's see this through some visual examples of customer retention.
Our Customer Retention Dashboard Example
Measuring customer retention with modern and professional software is critical for any SaaS business that wants to establish a healthy relationship with its customers, share the knowledge with internal teams, and keep a positive business development environment. Let's take a closer look at how dashboards for retention look in a SaaS environment.
**click to enlarge**
This business dashboard starts with an at-a-glance overview of the net promoter score (NPS), loyal customer rate, the percentage of premium users, and the customer lifetime value (CLV). These SaaS retention metrics depend on the specific company's policies and the way that they define whether a customer is considered loyal or premium. Usually, the premium categorization is considered as customers that subscribe to the biggest package that a SaaS business offers but it can also depend, as mentioned. Below this quick overview, you can see the comparison between the last month and the previous period, therefore, you can conclude that the net promoter score is a bit lower while other top metrics of this SaaS dashboard have a positive development.
Doing exceptional work for your clients and customers is a critical point of this dashboard because customers will cancel their subscriptions if they're not satisfied with your business and simply go elsewhere. The next parts, organized in 4 main areas will show you the details of how successful your strategies work: the customer and revenue churn, net retention, and MRR growth.
Retention and churn are the pillars of successful business optimization since both are closely connected but describe different things. Our customer churn analysis example shows that the total percentage amounts to almost 17% for the past 12 months. The development is clearly shown in a line chart where users can immediately see how it behaved during the specific time frame. Here we need to emphasize that, in this calculation, the cancellations and downgrades are both included because they both affect the revenue, especially if bigger packages are downgraded to the smallest ones which can cause significant effects.
At the bottom of the dashboard, you can see the other 2 areas focused on net retention and MRR. The graph on the left shows that the business is quite stable, slightly lower in comparison to the previous period but the development on the bottom graph shows the details between the number of lost customers, new customers, and the retention rate. Some months performed better while others could use additional examination with the help of a BI dashboard software to create better and more lucrative strategies for the future.
Finally, the monthly recurring revenue (MRR) is an increasingly important part of developing and sustaining a profitable SaaS company. These kinds of dashboards for customer retention should show the details of the MRR: growth for the last month, total, and the growth rate over the course of 11 months. You can see that January shows a decline in the growth rate, which can possibly mean that clients canceled their subscriptions at the end of the year.
If you're eager to create such an interactive visual, we suggest you read our guide on how to create a dashboard.
In our next part of the article, we will focus on retention metrics examples, similar to ones depicted on the customer service retention dashboard above, but they can also be adjusted for specific business uses, as mentioned earlier.
Customer Retention Metrics Examples
Since we explained the exact customer retention dashboard definition, provided you with a data story of a stable SaaS business that can brainstorm ideas for further growth. Now we will talk about each metric in detail and why they are important in establishing a proper process on how to measure customer retention.
1. Net customer retention KPI
The monthly net retention is a critical metric that contributes to the growth and it can cause significant differences in revenue generation over longer periods of time. If you don't cherish and develop positive relationships with your customers, it will show in the numbers and cause an impact on the bottom line.
To get a better understanding of underlying customer dynamics, the net retention will show you the number of lost customers, new customers, and the net retention rate but, in the visual above, calculations only include cancellations to get a clear picture of the customers' behavior towards the product. You can see that some months have achieved more success than others but that doesn't have to be discouraging, it simply shows that the business should examine in more detail why customers canceled and improve the product or service for the future.
2. MRR growth rate
The MRR is a metric that gives SaaS companies the most accurate status checkup. The recurring components will enable you to forecast the financial future much better, and give you a clear understanding of your business development and whether you need further adjustments.
In the example above, we can see that in the last 12 months the MRR grew by more than 7% and the growth rate over a longer period of time seems stable but, as always, there is room to grow even more. To learn more about the details of the importance and management of the MRR, we suggest you read our guide on the topic of monthly recurring revenue.
3. Customer churn
Customer churn is another critical metric that affects the SaaS client retention processes. Also known as customer attrition, this metric will show you the exact percentage of customers that stopped using your product or service. It's crucial to keep this percentage as low as possible since lower churn rates mean your customers are loyal, satisfied with the product, and will not turn their backs on you.
This visual above, created with a customer retention dashboard tool, shows the monthly churn rate that includes cancellations and downgrades. In a wide sense, churn can also mean the closure of an account, the decision to stop buying and use another provider, etc., but that depends on which industry you work in. The point is to keep the churn low, provide exceptional customer service by defining clear goals, continuously exceed customers' expectations, and listen to your customer's needs.
4. Revenue churn
The revenue churn also refers to loss, but that of revenue. It can happen due to lost contracts, downgrades, bankruptcies, etc. It assesses the degree to which customers spend over a period of time, and, if they spend more in the current period than in the previous one, this is shown as a negative revenue churn.
In the example above, we can see that in the last month and last year, the churn rate was negative and that signals a positive development. The progress on a monthly period is shown in a simple line chart where you can immediately identify which months performed best and learn from the ones that haven't achieved success.
5. Customer lifetime value (CLV)
One of the vital sales KPIs related to customer retention, CLV offers a definitive visual indication of how much revenue your repeat or loyal customers are driving to your business. Closely linked to the cost per acquisition (CAC) metric, frequently tracking your CLV will empower you to understand how much revenue you can expect from a customer during your relationship. This KPI will help you identify trends, make accurate projections, and take valuable measures to steadily increase your CLV rates over time.
6. Net promoter score (NPS)
One of the most vital user retention metrics for any modern business, NPS is a KPI that will tell you how people perceive your business and the level of service it offers. A powerful means of evaluating the power of your referrals, your NPS score will tell you how many people are likely to recommend or promote your brand. Here’s how it works:
You ask your customers how likely they are to recommend your brand on a scale of 1-10. Their responses put them into one of three NPS groups:
- Promoters (9-10)
- Passives (7-8)
- Detractors (0-6)
By taking the percentage of the customers that fall into the ‘promoter’ category (9 - 10) and subtracting that figure from the ‘detractors’ (0 - 6), you'll get your definitive NPS score. If you track this metric regularly, you can evaluate the right customer-focused areas of your business and take measures to improve your NPS score. When you do that, you will retain more customers, accelerating your business growth in the process.
7. Repeat purchase ratio (RPR)
The perfect addition to any churn rate dashboard, RPR is a retention metric that provides a clear indication of the percentage of customers that have bought goods or services from your businesses more than once. A powerful means of quantifying customer loyalty, analyzing your RPR allows you to accurately assess the performance and impact of your various consumer retention initiatives. Using this KPI, you can see which segments of your customers are making the most repeat purchases, tweaking your marketing campaigns and messaging to inspire customer loyalty across a wider cross-section of your audience.
8. Customer satisfaction
When it comes to understanding a user retention rate of any kind, gaining an insight into how your customers perceive you is essential. Customer satisfaction is integral to the ongoing health, growth, and success of your business, and this powerful customer retention rate metric will help you pinpoint any potential issues that are harming your reputation. By working closely with this customer satisfaction KPI, you will get a clear snapshot of how your customers feel about your business from a range of ‘very unsatisfied’ to ‘very satisfied.’ In turn, you can get to the heart of any potential customer issues, improve your service & communications, and drive your satisfaction rates through the roof.
9. Product return rate
Our next churn dashboard KPI is product return rate. If you’re a business that sells tangible goods and products, monitoring this metric will give you a panoramic snapshot of how many items were sent back to you over a certain timeframe. While people send back products for a number of reasons, returns are rarely positive and outline an issue, either with services or the goods themselves. Measuring your product return rate regularly will give you a greater insight into specific goods or service problems, empowering you to nip any issues in the bud, drive returns down, and ultimately, keep your customers happy.
10. Customer retention
This most valuable of customer retention KPIs offers a definitive visual marker of customer loyalty. Retaining repeat customers is cheaper than acquiring new ones. Plus, the more loyal consumers you have, the better your brand reputation will become. That said, tracking your customer retention KPI is important. This powerful customer retention report metric allows you to set a target while monitoring your retention rates over a set timeframe, giving you the tools needed for improving loyalty consistently.
11. Time between purchases
When it comes to customer retention analysis, knowing how frequently people buy products from your business will give you a deep level of consumer insights while allowing you to make accurate strategic projections surrounding your sales, service, and marketing initiatives. By comparing this metric to your customer satisfaction and NPS scores, you will quickly begin to understand whether a lot of downtime between purchases is because your product is well-built and robust (positive), or if it fails to stand out from your competitors’ offerings and your customers are shopping elsewhere (negative). This level of intelligence will give you the tools to evaluate what you sell and how you sell it, allowing you to make valuable strategic decisions that increase repeat purchase frequency over time.
Why Is Customer Retention Analytics Important?
Now that you understand the concept of customer retention analytics and the power of using visual KPIs to understand your consumers on a deeper level, let’s consider why using online dashboards and reports to improve loyalty is vital.
First of all, in today’s hyper-connected digital world, consumers expect a flawless level of customer service and experience from brands. No exceptions. If you prioritize your service, experience, and messaging, you will retain more customers. And when you do that, your business will grow, and you will set yourself apart from the pack.
By investing in a retention dashboard and analytics, you will be able to understand the factors hindering your customer loyalty rates and take targeted actions to boost retention. Here’s why retention analytics is worth your time and effort:
Growth & profitability
Analyzing the behaviors and satisfaction rates of your customers will give you the tools to encourage loyalty. This is a valuable initiative, as not only is keeping customers more cost-effective than gaining new ones, but loyal customers will also act as brand referrers or advocates, helping you grow your business faster with minimal outgoings. Existing customers are around 70% more likely to make a purchase than brand new prospects: demonstrate that you understand their needs and you will boost your sales. Retention analytics will help you do just that.
Expanding on our previous point: By turning one-time customers into repeat purchasing advocates, you will also boost your brand reputation. Happy repeat customers that refer others will shine your brand in a brilliant light, sharing positive reviews, testimonials, and content online. In turn, this will boost your authority in search engines, build consumer trust, and empower you to grow your audience organically (with less marketing spend) while gaining an edge on the competition.
Evolution & responsivity
Customer retention analytics is the most effective way of keeping track of relevant trends and understanding the ever-changing needs of your audience. When it comes to customer retention, the goalposts are always moving. By working with the right mix of data analysis tools, you will be able to respond to constant change and evolve your efforts to continually retain customers and inspire loyalty. Doing so will ensure you stay on top of your game, not only in the short term but long in the future.
Key Takeaways On Customer Retention Dashboards & Metrics
We’ve explained the importance of the churn and retention rate, explored a host of powerful retention metrics examples, looked at net retention rate & customer retention KPI formula, and one thing is clear: retention or loyalty analytics is essential to ongoing business growth. We are living in an increasingly competitive time where the customer is well and truly in the driver’s seat.
Understand your business processes and service methods as well as the needs or thoughts of your customers on a deeper level, and you will set yourself apart from your competitors. Work with the right BI dashboards, reports, and KPIs, and you will see your retention rates soar. When that happens, you will experience more success than you imagined possible.
To start your own journey and utilize modern customer retention dashboard software, you can sign up for datapine's 14-day trial, completely free!