ANTICIPATED Impact of COVID-19 on Canadian SaaS Retention and Churn
SaaSCan™ surveyed Canadian SaaS companies from April 8 – 15, 2020 on their expectations for revenue retention and churn in the 2 quarters following March 11, 2020, the day the World Health Organization declared Covid-19 a global pandemic. The findings may surprise you. Have a read.
Summary of Key Conclusions
- As a direct result of Covid-19, 56% of Canadian SaaS companies anticipated Gross Revenue Retention (GRR) would fall in the quarter or two immediately following March 11, 2020, 37% expected it to be flat, and 7% anticipated it would increase.
2. Somewhat more optimistically, 60% of Canadian SaaS companies anticipated Net Revenue Retention (NRR) to decline in the quarter or two post-March 11, 2020, 24% expected it to remain flat, and 16% expected it to increase.
3. The most significant factors driving anticipated Canadian SaaS company retention and churn post Covid-19 were Annual Contract Value (ACV) and industry vertical.
4. The lower a Canadian SaaS company’s ACV, the higher their anticipated gross and net churn post Covid-19.
5. Canadian SaaS companies serving industry verticals with immediate or urgent needs (ie: healthcare/health tech, media, high tech, higher education, supply chain) had lower anticipated churn, as well as higher anticipated revenue retention and growth post Covid-19.
6. Canadian SaaS companies anticipate GRR declines similar in size to US companies by percentage, but were more optimistic than their US counterparts about declines in NRR.
7. Canadian SaaS companies were adopting a pro-active approach, pivoting in 3 key areas:
product roadmap, professional services, and customer success practices.
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About the Author
Lauren Thibodeau is the Founder and Chief Research Officer of SaaSCan. She also runs consulting firm WTC Solutions, enabling B2B SaaS companies to grow recurring revenue and crush churn by maturing their customer experience, customer success, and product adoption practices. Lauren lives in Ottawa, Canada with her husband and three children.
