7 B2B SaaS Marketing Benchmarks
You Need To Keep An Eye On
Nowadays, the world of B2B SaaS marketing is so competitive that it’s more important than ever to make sure you’re on the right track.
One way to do that is by continuously tracking the right B2B SaaS marketing metrics and adjusting your strategy accordingly.
But more than that, you also need to check if your performance is up to par with the current industry standards.
This is where benchmarks come in.
In this article, we will talk about various B2B SaaS marketing benchmarks that you should take into account.
1) Website Traffic
A huge part of B2B SaaS marketing is driving website traffic.
The amount of website traffic you’re able to generate will have a direct impact on other important metrics, such as conversion rate and revenue.
Now, let’s look at the benchmarks for a few SaaS metrics that concern your website traffic:
Monthly Unique Visitors
The number of monthly unique visitors is a metric that measures the total number of unique visitors to your website in a given month.
The thing is, you can’t really put a standard on the number of unique visitors you’re getting per month.
But what you can compare is your growth in that area.
According to First Page Sage, the number of your monthly unique visitors should be growing by at least 10% every month.
Bounce rate is the percentage of visitors who leave your website after viewing only one page.
A high bounce rate is generally not a good thing, as it indicates that people are not finding what they’re looking for on your website
There are a number of factors that can contribute to a high bounce rate, such as poor website design, slow loading times, and irrelevant content.
According to Gripped, the average bounce rate for a B2B SaaS website is around 30-50%.
If your bounce rate is higher than that, it’s an indication that you need to take a closer look at your website and see what needs to be improved.
Average Visit Duration
Average visit duration is the average amount of time that people spend on your website.
This marketing metric is a good indicator of engagement and can give you insights into how interesting and useful people find your website
The average visit duration benchmark for a B2B SaaS website is around 2-3 minutes, as reported by Gripped.
This would indicate that you have high-quality content that maintains your visitors’ attention.
If your average visit duration is significantly lower than that, it’s an indication that you need to work on making your website more engaging.
2) Conversion Rate
Conversion rate is the percentage of visitors who take a specific desired action on your website.
Some examples of desired actions could be signing up for a free trial, subscribing to a newsletter, or downloading a white paper.
The conversion rate will differ depending on what kind of business you’re in and what your desired action is.
Let’s take a look at SaaS benchmarks for some variations of the conversion rate.
Visitor-to-Lead Conversion Rate
The visitor-to-lead conversion rate is the percentage of visitors who take the desired action that turns them into a lead.
A lead is somebody who has shown interest in your SaaS product and has voluntarily given you their contact information.
For example, let’s say a website visitor wants to receive your email newsletters. In order to do that, they have to fill out a form with their name, email address, and company name.
Once they submit the form, they become a lead.
The visitor-to-lead conversion rate would be the percentage of people who take that desired action (filling out the form) out of the total number of visitors.
First Page Sage reported that the visitor-to-lead conversion rate benchmark for a B2B SaaS website is around 1.9%.
Lead-to-MQL Conversion Rate
A marketing qualified lead (MQL) is a lead that is a good fit with your SaaS product and has shown more interest in buying it.
As the name suggests, the lead-to-MQL conversion rate is the percentage of leads who become MQLs.
The lead-to-MQL conversion rate benchmark for a B2B SaaS company is around 39%, as mentioned by First Page Sage.
Lead-to-Customer Conversion Rate
The lead-to-customer conversion rate is the percentage of leads who become customers. This metric is also sometimes referred to as the sales conversion rate.
Now, the benchmark for this metric depends on whether you’re primarily using outbound or inbound marketing.
For inbound marketing, the benchmark for lead-to-customer conversion rate is 0.05%, according to Growfusely.
If you’re using an outbound marketing strategy, however, you may end up with less qualified leads than what an inbound marketing strategy can generate.
That’s why the lead-to-customer conversion rate benchmark for outbound marketing is at a slightly lower 0.03%.
3) Customer Churn Rate
The churn rate is the percentage of customers who stop using your product or service within a certain time period.
It’s important to keep track of your customer churn rate so you can identify any potential problems early on and take steps to prevent them.
So what is a good churn rate for B2B SaaS businesses?
There are actually a lot of factors involved. But the most weighty among them is the composition of your customer base.
If your customers are mostly small to medium-sized businesses (SMBs), a monthly churn rate of around 3% to 5% is still considered acceptable.
But if you’re a larger SaaS business raking in an annual recurring revenue (ARR) of $10 million or more, the standard churn rate is around 1% to 45.
4) Customer Acquisition Cost (CAC)
The customer acquisition cost (CAC) is the amount of money you spend to acquire one new customer.
To calculate your CAC, you need to take your total sales and marketing spend for a period of time and divide it by the number of new customers you acquired during that same period.
Now, let’s take your CACs for paid and organic acquisition channels and compare them to the industry benchmarks.
Organic Customer Acquisition Cost
The organic CAC is the amount of money you spend to acquire one new customer through your organic digital marketing channels, such as content marketing or social media marketing.
As reported by Gripped, the benchmark for organic customer acquisition cost for B2B SaaS businesses is $205.
Paid Customer Acquisition Cost
The paid CAC is the amount of money you spend to acquire one new customer through a paid channel, such as Google Ads or social media ads. These tend to be more expensive than organic channels.
The benchmark for paid customer acquisition cost for B2B SaaS businesses is $341.
5) LTV CAC Ratio
A high LTV to CAC ratio means that you’re generating more revenue from each customer than it costs you to acquire them. This is a good sign that your business is healthy and sustainable.
The standard LTV CAC ratio for B2B SaaS businesses is around 3:1 to 5:1.
This means that for every $1 you spend on acquiring a customer, you generate $3 to $5 in revenue.
Note that it’s important that you stay within that range.
If your ratio is lower than 3:1, it means that there isn’t a big enough margin from your revenue and CAC. This is not a sustainable business model and can eventually lead to slow growth.
On the other hand, if your ratio is higher than 5:1, it means that you’re missing out on potential growth opportunities. It’s an indicator that you can literally afford to acquire more customers and revenue by increasing your marketing budget.
6) Net Revenue Retention
Net revenue retention is the resulting change in recurring revenue from your existing customers, factoring in all possible additions or deductions from it.
These include the following:
- Starting MRR: Your monthly recurring revenue (MRR) at the start of the month.
- Expansion MRR: New revenue coming from upselling and cross-selling.
- Churn MRR: Revenue lost due to churn.
- Contraction MRR: Revenue lost due to downgraded subscriptions.
To calculate your net revenue retention, add your starting MRR and expansion MRR. Then subtract the sum of your churn MRR and contraction MRR.
Finally, to calculate how much your revenue changed since the start of the month, divide the resulting difference by your starting MRR.
The benchmark for net revenue retention varies depending on the composition of your customer base.
If you have SMBs as customers, net revenue retention of 90% or higher is still acceptable.
If you’re catering to an enterprise market, the standard for net revenue retention is around 120%.
7) Net Promoter Score (NPS)
The Net Promoter Score (NPS) is a metric that measures customer satisfaction and loyalty.
First, you launch a survey asking customers how likely they are to recommend your SaaS product, on a scale of 1 to 10.
Then you group your respondents based on their answers:
- Promoters: score 9 or 10
- Passives: score 7 or 8
- Detractors: score 6 or lower
To calculate your NPS, subtract the percentage of detractors from the percentage of promoters. The resulting score can be anywhere from -100 (all are detractors) to +100 (all are promoters).
Final Thoughts About B2B SaaS Marketing Benchmarks
As a B2B SaaS marketer, it’s important to have an understanding of the various benchmarks in order to accurately gauge your performance.
After all, it’s the only way of knowing whether or not your B2B marketing performance is up to par with industry standards.
If you’re not meeting the benchmarks, don’t sweat it too much. No company is perfect, after all. And there’s always room for improvement.
Just be sure to take action and make the necessary changes in order to get back on track.
Looking for more guides to help you grow your SaaS business? Check out our blog here.