SaaS Glossary

Mastering SaaS: A Comprehensive Glossary for Entrepreneurs, Builders, and Innovators

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Annual Recurring Revenue (ARR)

Annual Recurring Revenue (ARR) represents recurring revenue a company expects to generate annually from subscription-based customer contracts.

Average Contract Value (ACV)

Average Contract Value represents the average annualized revenue generated from a customer contract over a one-year period.

Average Revenue Per Account (ARPA)

Average Revenue Per Account (ARPA) is used to measure the average revenue generated from each customer account over a specific period, typically monthly or annually.

Average Revenue Per User (ARPU)

Average Revenue Per User (ARPU) represents the average revenue generated by each active user or consumer over a specific period of time.

Customer Acquisition Cost (CAC)

Customer Acquisition Cost (CAC) measures the total cost incurred by a business to acquire a single new customer.

Customer Churn Rate (CCR)

Customer Churn Rate measures the percentage of customers who stop doing business with your company during a specific period.

Customer Lifetime Value (CLV)

Customer Lifetime Value (CLV) estimates the total revenue a business can expect to earn from a single customer throughout their entire relationship with the company.

Customer Relationship Management (CRM)

Customer Relationship Management (CRM) software is a tech platform designed to centralize your customer data and commercial processes.

Go-To-Market (GTM)

A Go-To-Market (GTM) strategy is an actionable plan that outlines how you will launch a new solution –or enter a new market with an existing solution– and reach your target customers.

Marketing-Led Growth (MLG)

Marketing-Led Growth (MLG) is a go-to-market motion that places marketing at the forefront of driving customer acquisition, retention, and overall business growth.

Monthly Recurring Revenue (MRR)

Monthly Recurring Revenue (MRR) represents recurring revenue a company expects to generate monthly from subscription-based customer contracts.

Net Revenue Retention (NRR)

Net Revenue Retention (NRR) is a metric that essentially tracks your ability to retain and grow your customers over time.

Product-Led Growth (PLG)

Product-Led Growth (PLG) is a go-to-market motion that positions the product itself as the primary driver of customer acquisition, activation, retention, and expansion.

Sales-Led Growth (SLG)

Sales-Led Growth (SLG) is a go-to-market motion that prioritizes the sales team as the primary driver of customer acquisition, revenue generation, and overall business expansion.

Total Contract Value (TCV)

Total Contract Value (TCV) represents the total revenue a business expects to earn from a particular customer contract over its entire duration.

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