Metrics and Key Performance Indicators (KPIs) are the vital signs of your business. They measure how effectively your company is achieving its objectives—guiding strategic decisions, optimizing performance, and demonstrating value to stakeholders.
Core Go-to-Market Metrics:
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Customer Acquisition Cost (CAC):
The total cost of acquiring a new customer, including marketing, sales, and onboarding expenses.
Formula: Total acquisition costs ÷ Number of new customers -
Customer Lifetime Value (CLV or LTV):
The projected revenue a customer will generate over the course of their relationship with your business.
Helps evaluate the ROI of your customer acquisition efforts. -
CAC to CLV Ratio:
A key profitability indicator—shows whether you’re spending efficiently to acquire valuable customers.
A healthy ratio is often considered 1:3 or better. -
Churn Rate:
The percentage of customers who stop doing business with you over a given time.
Lower churn = stronger retention and recurring revenue. -
Monthly Recurring Revenue (MRR) / Annual Recurring Revenue (ARR):
Predictable revenue from subscription or retainer-based models—crucial for growth forecasting. -
Sales Conversion Rate:
The percentage of leads that convert into paying customers.
Reflects the efficiency of your sales funnel. -
Net Promoter Score (NPS):
A measure of customer satisfaction and loyalty, based on how likely customers are to recommend you.
Why They Matter:
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Reveal performance strengths and gaps
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Guide investment and resource allocation
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Support data-driven scaling decisions
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Demonstrate traction to investors or stakeholders
Tracking the right metrics ensures your business stays focused, accountable, and positioned for sustainable growth.