aaS

Question 1

Cloud Computing

Answer 1

Cloud computing is using a network of different servers that host, store, manage, and process data online to develop and run software and services on the internet.

Question 2

IaaS

Answer 2

IaaS, or infrastructure as a service, is a cloud-based service that allows resources to be delivered to organizations virtually (or through the cloud). IaaS tools help organizations build and manage servers, networks, operating systems, and data storage without needing to buy hardware. IaaS customers use a dashboard or API (application programming interface) to access and manage their resources.

Examples: Amazon Web Services, Microsoft Azure, Google Cloud, IBM Cloud.

Question 3

PaaS

Answer 3

A PaaS, or platform as a service, provides developers with a framework they can use to build custom applications. PaaS doesn’t deliver software over the internet, but rather a platform that developers can use to create online software and apps. You can think of PaaS as a scaled-down version of IaaS. It still provides customers with servers and data centers to store their information (in this instance, an app), but its customer is a developer creating an app that will then be delivered over the internet to consumers. SaaS applications are developed on PaaS platforms.

Examples: Google App Engine, Kinsta, Red Hat OpenShift, Heroku, Apprenda.

Question 4

SaaS

Answer 4

SaaS, or software as a service, refers to cloud-based software that is hosted online by a company, is available for purchase on a subscription basis, and is delivered to buyers (consumers and/or companies) via the internet. These tools can either be used as a web app (such as Google Docs, part of Google Workspace, formerly G suite) or downloaded and installed on the device (such as Adobe Creative Cloud).

Examples: HubSpot, JIRA, Dropbox, DocuSign

Question 5

CRM

Answer 5

Customer Relationship Management

Question 6

COI

Answer 6

Centers of Influence

Question 7

On-Premises Software

Answer 7

On-premises software usually requires you to buy a license so you can install it on the organization’s hardware.

Question 8

IaaS benefits (pros)

Answer 8

• Its pay-as-you-go model allows businesses to only pay for the resources they use.
• Organizations have complete control over their infrastructure.
• It can be scaled or downsized as needed.
• There’s no need to buy a physical server or maintain it.

Question 9

PaaS benefits (pros)

Answer 9

• With a PaaS, developers build their app right on the platform, then deploy it immediately.
• PaaS tools are very easy to use and sign-up for.
• Developers can collaborate with other developers on a single app.
• Developers can easily customize and update apps without thinking about software upkeep on the backend. Just code and go.
• If the app grows in adoption and usage, PaaS platforms offer great flexibility and scalability.

Question 10

Amazon Web Services (AWS)

Answer 10

AWS is the IaaS product overseen by Amazon and is used for on-demand cloud computing and purchased on a recurring subscription basis. AWS helps companies store data and deliver content — in fact, it’s helping you read this blog post right now.

Question 11

Microsoft Azure

Answer 11

Microsoft Azure is a cloud-computing IaaS product that allows for building, testing, and managing applications through a network of Microsoft data centers.

Question 12

Google Cloud

Answer 12

Google Cloud is an IaaS platform that businesses can use to natively run Windows, Oracle, and SAP. Additionally, a business can manage its enterprise database and use AI solutions to increase operational efficiency within the firm.

Question 13

IBM Cloud

Answer 13

IBM Cloud is another IaaS product that allows businesses to “allocate your computer, network, storage and security resources on demand.” In other words, businesses only use resources when needed, increasing efficiency.

Question 14

Google App Engine

Answer 14

Google App Engine is a PaaS product that allows developers to build and host web applications in cloud-based data centers that Google manages.

Question 15

Kinsta

Answer 15

Kinsta is a PaaS product that provides Application, Database, and Managed WordPress Hosting solutions that make it quick and easy to deploy any web application in minutes, without worrying about the hosting infrastructure.

Question 16

Red Hat OpenShift

Answer 16

Red Hat OpenShift is an on-premises containerization PaaS software.

Question 17

Heroku

Answer 17

Developers can use this PaaS tool to build, manage, and grow consumer-facing apps.

Question 18

Apprenda

Answer 18

Apprenda is a PaaS product that allows developers and businesses to host an entire application portfolio. Build and deploy applications of all types on this platform.

Question 19

SaaS benefits (pros)

Answer 19

• Because SaaS products are cloud-based, all you need to do to start accessing applications is to simply log in.
• You don’t have to manage or upgrade the software. This is typically included in a SaaS subscription or purchase.
• It won’t use any of your local resources, such as space on your physical server (if you have one).
• It’s extremely easy to find and purchase a SaaS product.
• Your IT team won’t have to worry about the upkeep of a SaaS product.

Question 20

HubSpot

Answer 20

HubSpot is a CRM, marketing, sales, and service SaaS platform that businesses use to connect with and retain customers.

Question 21

JIRA

Answer 21

JIRA is a project management software that’s delivered by Atlassian and can be purchased on a subscription basis by customers.

Question 22

Dropbox

Answer 22

Dropbox is a file-sharing SaaS tool that allows multiple users within a group or organization to upload and download different files.

Question 23

DocuSign

Answer 23

DocuSign is a SaaS product that businesses use to send contracts and other documents that require signatures.

Question 24

Customer Churn

Answer 24

Customer churn rate measures how much business you’ve lost within a certain time period. It is one of the most important metrics in tracking the day-to-day vitality of your business, and can help you better understand customer retention across specific date or time periods.

Question 25

Revenue Churn

Answer 25

Revenue churn rate measures how much revenue you’ve lost within a certain time period.

Question 26

Customer Lifetime Value (CLV or LTV)

Answer 26

Customer lifetime value (CLV) is the average amount of money that your customers pay during their engagement with your company. The metric provides businesses with an accurate portrayal of their growth. CLV shows what your average customer is worth. And for those still in the startup mode, it can display the value of your company to investors: Since most SaaS businesses operate with subscription-based models, each renewal yields another year of recurring revenue, ultimately increasing the lifetime value per customer.

Question 27

Customer Acquisition Cost (CAC)

Answer 27

Customer acquisition cost (CAC) shows exactly how much it costs to acquire new customers and how much value they bring to your business. When combined with CLV, this metric helps companies guarantee that their business model is viable. To calculate CAC, divide your total sales and marketing spend (including personnel) by the total number of new customers you add during a given time. For example, if you spend $100,000 over a month, and you added 100 new customers, your CAC would be $1,000.

Question 28

Months to Recover CAC (CAC Payback Period)

Answer 28

The CAC Payback Period measures the number of months it takes to generate enough revenue to cover the cost of acquiring a customer. In other words, it measures when you break even and a customer starts to generate ROI for your business. Say you spend $4,000 to acquire a new customer, for example, and you bill them at the rate of $400 per month. Let’s say the gross margin is 90%. In that case, it will take a little over 11 months for you to begin seeing a positive cash flow. Atlassian, for example, was profitable only three years after its founding and without any venture capital because it relied on free trials instead of salespeople to convert leads into enterprise customers. This kept their months to recover CAC low, which led to their profit skyrocketing.

Question 29

CLV-to-CAC Ratio (or LTV-to-CAC)

Answer 29

Generally, a healthy business should have a CLV that is at least three times greater than its CAC. Any lower (say, a 1:1 ratio) and you’re spending too much money. Any higher (a 5:1 ratio) and you’re spending too little and probably missing out on business.

Question 30

Annual Recurring Revenue (ARR)

Answer 30

Subscription Economy® metric that shows the money that comes in every year for the life of a subscription (or contract). More specifically, ARR is the value of the recurring revenue of a business’s term subscriptions normalized for a single calendar year. For example, if your subscriber purchases a two-year subscription for $12,000, the ARR would be $6,000 for each year. ARR is predictable revenue that can be counted on every year.

Question 31

SLA

Answer 31

A service-level agreement (SLA) defines the level of service you expect from a vendor, laying out the metrics by which service is measured, as well as remedies or penalties should agreed-on service levels not be achieved. It is a critical component of any technology vendor contract.

Question 32

Customer Engagement Score

Answer 32

Customer engagement score is a single metric that is used to measure how engaged your customers are. The metric is represented by a number based on customer activity and usage of your product or service — the higher the number the happier and more engaged the customer.

Together with customer satisfaction, customer engagement is one of the best churn predictors you can have. Actually there are three main reasons why you should care about customer engagement en behavior. Customer engagement score can help you:

Identify customers in trials that are ready to purchase;
Identify customers that need help or are about to churn;
Identify customers that are appropriate for an upsell or cross-sell.

To create your own customer engagement score, come up with a list of inputs that predict a customer’s happiness and longevity — by starting with looking at your happiest, longest-standing customers. Do they log into the service every day? Do they reach usage milestones within a certain period of time?

Question 33

Qualified Marketing Traffic

Answer 33

Identified by what it is not, this is new, non-returning-customer traffic that can help predict sales. Being able to differentiate between these two groups will allow you to set actionable traffic KPIs and build a solid traffic-generation plan.

Question 34

KPI

Answer 34

A key performance indicator (KPI) is a measurable value that demonstrates how effectively a company is achieving key business objectives. Organizations use KPIs to evaluate their progress and success at reaching targets.

In simple terms, a KPI is a goal that you work towards achieving. For the sake of simplicity, let’s look at this example: you own an apple stand and to be profitable this month, you have to sell 1,000 apples.

So, you set your KPI: sell 1,000 apples this month.

KPIs should align with overall business strategy and be actionable, realistic, and measurable.

Question 35

Customer Lifecycle

Answer 35

The customer lifecycle refers to the process of prospects becoming aware of a product, making a purchase from a brand, and ideally becoming a company’s longtime customer. The process is made up of five stages: reach, acquisition, conversion, retention, and loyalty.

Question 36

Lead-to-Customer Rate

Answer 36

This metric shows exactly how well you’re generating sales-ready leads — and improving over time. It outlines, on average, how many leads turn into paying customers. In other words, it shows whether your sales process and lead-nurturing methods are working or not.

Lead-to-customer rate is easy to calculate. Take your total number of customers for any given month, divide it by the total number of leads, and multiply that number by 100. For example, five customers in a month with 500 leads would result in a 1% lead-to-customer rate.

Question 37

Customer Health Score

Answer 37

Similar to customer engagement scoring, customer health scoring assigns different values to different signals of customer loyalty or customer churn, helps your customer-facing employees get a bird’s-eye view of how their portfolio of customers are doing so they can reach out to customers at risk of churning with educational resources, additional support, beforethey actually lose them.

Let’s take a look at how Upscope calculates this metric based on one core factor: usage. Upscope factors in several inputs, all related to usage. These include:

Total number of seconds the customer used Upscope co-browsing in the last month
How much they’re spending per second (divide how much money they’re spending per month by the amount of time spent using the product)
Number of people they screen share with
Total number of agents using it
Amount of time the top 20% of the company’s agents use it per month
The % of agents that used it the previous month that are still using it this month
How much of the total usage is made by the bottom 50% of agents
How much of the total usage is made by every employee but the top agent
Each factor is assigned a weighted value based on the perceived importance of the factor. These values are all summed together and put on a scale between 0 and 100, with 100 being the top 5% of customers. You can see a snapshot of some of Upscope’s customer’s health scores below.

Question 38

Customer Loyalty Program

Answer 38

A customer loyalty program is a program your business offers that rewards customers for their continuous purchases from you.

Rewards can be free products, early and exclusive access to new products or events, point systems, awards, exclusive merchandise — anything you want to do to share your appreciation with them for their business.

Question 39

Expansion Revenue

Answer 39

You can calculate expansion revenue by simply adding together all of the extra purchases that are made by your existing customers. Extra purchases include upsells and cross-sells where customers buy more or upgrade their current products. It also includes add-ons like widgets which can be purchased and installed into the product or service.

By analyzing expansion revenue over time, you can see whether your sales, marketing, and customer service teams are not only attracting new leads but also adding more value for your existing customers. Attracting new leads is great but you want to get the most from the customers who really depend on your products. If you feel like your added offers are falling short, you should be able to confirm this trend using monthly and annual expansion revenue.

Question 40

Net Promoter Score (NPS)

Answer 40

Net Promoter Score or NPS® is a quantitative and qualitative report of customer satisfaction at your company. It asks customers to evaluate their experience with your company on a numerical scale as well as provide a brief synopsis for why they chose the value that they did. This allows companies to rank and organize customer reviews and ensure the feedback they are collecting is put to its best use. Since customers are ranking their experiences on a scale, businesses can store historical values for these scores and see how they have improved over time. If the scores go up, the company will know that customers are happy with the product or service you’re providing. If they go down, you can use the customer’s specific feedback in the survey to pinpoint why your customers are unhappy.