In the evolving SaaS landscape, the relationship between Customer Success (CS) and Sales has never been more critical—especially during the renewal process. As organizations continue to recognize that retention is the foundation of sustainable growth, implementing a metrics-driven approach that bridges CS and Sales teams is essential for maximizing revenue potential.
Renewals aren't just transactions—they're validation of continued value. While new sales might capture the spotlight, renewals often represent the most efficient path to revenue growth. According to industry benchmarks, acquiring a new customer can cost 5-25 times more than retaining an existing one, making renewals a critical focus area for sustainable business growth.
The most successful SaaS companies have recognized this reality and are breaking down traditional silos between CS and Sales teams, creating unified approaches to the renewal process. This collaboration hinges on shared metrics that provide visibility, accountability, and strategic direction.
A truly effective renewals strategy incorporates metrics that span the entire customer lifecycle. These seven key renewals metrics should be integrated into your sales process for maximum effectiveness:
What it measures: The percentage of customers who renew their contracts within a specific period. Ultimately, this number reflects overall customer satisfaction and health of your portfolio.
How to use it in the sales process:
Target benchmark: Industry leaders typically maintain renewal rates above 90%, while the SaaS average hovers around 80-85%.
What it measures: The percentage of recurring revenue retained from existing customers, excluding expansions and upsells. Ultimately, this number reflects how well the company retains its core base.
How to use it in the sales process:
Target benchmark: Best-in-class SaaS companies maintain GDR above 90%, while anything below 80% indicates significant churn issues.
What it measures: The total change in recurring revenue from existing customers, including expansions, upsells, cross-sells, downgrades, and churn. Ultimately, this number reflects the company’s ability to grow revenue from existing customers.
How to use it in the sales process:
Target benchmark: Top-performing SaaS companies exceed 120% NDR, indicating significant expansion within their customer base. The average hovers around 100-110%.
What it measures: How far in advance renewal conversations are initiated before contract expiration.
How to use it in the sales process:
Target benchmark: Best practice is initiating renewal conversations 90-120 days before expiration, with enterprise contracts requiring 150+ days.
What it measures: The percentage of renewals that successfully move through each stage of the renewal pipeline.
How to use it in the sales process:
Target benchmark: Aim for 80%+ progression rates between each renewal stage, with particular focus on early-stage advancement.
What it measures: The average time required to complete the renewal process from initiation to signature.
How to use it in the sales process:
Target benchmark: Efficient renewal processes close within 30-45 days of initiation, though enterprise deals may extend to 60-90 days.
What it measures: The distribution of reasons why renewals are lost, categorized by primary factor.
How to use it in the sales process:
Target benchmark: No single reason should account for more than 25% of lost renewals, and total lost renewals should remain below 10% of opportunities.
While renewal metrics provide the financial perspective, Customer Success metrics offer leading indicators that can predict renewal outcomes. The DEAR framework—comprising Deployment, Engagement, Adoption, and ROI—provides a structured approach to measure customer health through the lens of renewal readiness:
Key metrics:
Renewal impact: Customers who experience rapid, complete deployment are 60% more likely to renew than those with extended or partial implementations.
Key metrics:
Renewal impact: Accounts with active executive sponsors and regular engagement have renewal rates 30-40% higher than those with limited stakeholder involvement.
Key metrics:
Renewal impact: Customers in the top quartile of adoption metrics renew at rates exceeding 95%, while those in the bottom quartile drop below 60%.
Key metrics:
Renewal impact: Customers who can articulate specific ROI metrics renew at rates 40% higher than those who cannot quantify value received.
The power of these metrics is fully realized when Customer Success insights are systematically incorporated into the sales renewal process. As highlighted in our "Leveraging Milestones in Renewals Forecasting" article, transforming renewal forecasting from subjective guesswork to data-driven science requires anchoring forecast categories to specific, observable customer actions.
Building on our established milestone framework, we can enhance the approach by integrating CS insights into the renewal process:
Develop a shared dashboard that presents both CS and Sales metrics side by side:
Implement regular renewal pipeline reviews that bring CS and Sales together:
Organizations that successfully align Customer Success and Sales through shared metrics create a renewal engine that consistently outperforms competitors. This approach doesn't just improve renewal rates—it transforms the entire customer relationship into a strategic advantage.
By implementing these seven renewal metrics alongside the DEAR framework for Customer Success, companies can:
In today's customer-centric business environment, renewals represent the ultimate validation of your value proposition. By measuring what matters across both CS and Sales dimensions, you create a unified approach that maximizes revenue retention while strengthening customer relationships for the long term.