Customer experience (CX) is a critical function for any SaaS business. But all too often, CX teams are left to fend for themselves when it comes to tracking critical metrics across the customer base.

As a startup CX leader, I did monthly reporting of several critical customer measures, but when the time came to report to the board, very few of those metrics made headlines. This was due to a variety of factors, such as poor data and reporting of key metrics, a lack of understanding of the metrics for CX, and all too often, a lack of concern for them. In 2023, many executive teams focused on customer retention, and with that came a new focus on what metrics matter.

Below are some key executive metrics for customer experience and why they are important:

1. Baseline Data

The data used to benchmark or compare your results. This is typically data from the end of a period of measurement, for example, the year-end data from the prior year.

2. Customer Retention Rate

This value can also be referred to as gross retention rate. This is the percentage of customers who renew their contracts with you. This should be measured against your baseline and can be defined by logos retained or dollars retained. I recommend a line item for both logo and dollar retention.

3. Net Retention Rate

This value is considered a key metric for customer reporting. NRR is the percentage of revenue minus churn plus expansion as measured over the prior period or baseline. NRR is calculated by dividing the net revenue (revenue – churn + expansion) by the prior period’s revenue and multiplying by 100.

4. Customer Lifetime Value

This is the total amount of revenue you can expect to generate from a customer over their lifetime. This can be calculated by multiplying ARR by active or past contract periods. Your CLV can help you define how valuable your customers are, and which contracts and pricing models work best to maintain high CLV.

5. Customer Satisfaction Score

This is a measure of how satisfied your customers are with your product or service, as measured by your support health. Support is where most users come to improve their working experience, so it’s where the time to resolution and other metrics can impact overall customer experience with your product.

6. Net Promoter Score

This is a measure of how likely your customers are to recommend your product or service to others. NPS has gotten a bad rap lately, but it remains a measure of customer sentiment. Adding onto an annual NPS by measuring it more regularly (every three months is ideal) and driving advocacy programs based on it is one way to make it more robust.

7. Revenue at Risk or Green/Yellow to Red Ratio

When you understand your customer health, you can predict churn and which areas may need to be addressed. Revenue at risk or a health ratio can be great to add to your executive dashboard. These metrics tend to change over time, so they are especially useful to track on a more regular basis.

These metrics will help you track your team’s progress and identify areas for improvement with your customer base. But it’s important to remember that metrics are just one part of the equation. To succeed, you also need to create a culture of customer success within your organization. This means making sure that everyone understands what it means and how you measure to deliver great customer experience.