MRR and ARR(MRR / ARR)
E-commerce
E-commerce
MRR is your recurring monthly subscription revenue, ARR is the same revenue annualised. One-off projects don't count.
Break down the movement: new customers, expansion, contraction and cancellations. Net growth without that split hides a leak.
For marketing this is the bridge to budget: knowing monthly value and average lifetime tells you what you may pay for a new customer.
Related terms
- ChurnChurn is the share of customers or subscribers leaving within a period. It's the counterpart of retention.
- Customer lifetime valueCustomer lifetime value is the total margin you earn from an average customer for as long as they stay, not just on the first purchase.
- Subscription modelA subscription model is a pricing form where customers pay periodically for access or delivery instead of per purchase.