How To Calculate Monthly Recurring Revenue Cohort Analysis in AirTable | Arithmix

Calculating monthly recurring revenue (MRR) cohort analysis is an essential tool for any business that relies on subscription-based revenue models. This analysis helps businesses understand how much revenue they can expect to earn from their customers over time, which is crucial for making informed decisions about pricing, marketing, and customer retention strategies. In this article, we will explain what MRR cohort analysis is, when it is valuable to calculate it, and how to do it using AirTable.

What Is Monthly Recurring Revenue Cohort Analysis?

MRR cohort analysis is a method of tracking revenue generated by groups of customers who share a common characteristic, such as the month they signed up for a subscription service. This analysis helps businesses understand how much revenue they can expect to earn from each cohort of customers over time, which is essential for making informed decisions about pricing, marketing, and customer retention strategies.

For example, if a business has two cohorts of customers who signed up in January and February, respectively, they can use MRR cohort analysis to track how much revenue each cohort generates each month. This analysis can help the business identify trends in customer behavior, such as whether customers who signed up in January are more likely to renew their subscriptions than those who signed up in February.

When Is It Valuable To Calculate Monthly Recurring Revenue Cohort Analysis?

MRR cohort analysis is valuable for any business that relies on subscription-based revenue models, such as SaaS companies, subscription box services, and membership-based organizations. This analysis can help these businesses understand how much revenue they can expect to earn from their customers over time, which is crucial for making informed decisions about pricing, marketing, and customer retention strategies.

For example, a SaaS company may use MRR cohort analysis to track how much revenue each cohort of customers generates each month and identify trends in customer behavior, such as whether customers who signed up in January are more likely to upgrade to a higher-tier subscription plan than those who signed up in February. This information can help the company make informed decisions about pricing and marketing strategies to maximize revenue and customer retention.

How to Calculate Monthly Recurring Revenue Cohort Analysis in AirTable

To calculate MRR cohort analysis using AirTable, you will need to create a table that includes the following columns:

• Cohort: This column should include the month in which each cohort of customers signed up for the subscription service.
• Month: This column should include the month for which you are calculating MRR.
• Customers: This column should include the number of customers in each cohort who are still subscribed in the month you are calculating MRR.
• MRR: This column should include the total monthly recurring revenue generated by each cohort in the month you are calculating MRR.

Once you have created this table, you can use AirTable's formula feature to calculate MRR for each cohort in each month. To do this, you will need to create a formula that multiplies the number of customers in each cohort by the subscription price and any discounts or promotions that apply to that cohort.

For example, if a SaaS company charges $50 per month for its basic subscription plan and offers a 10% discount to customers who signed up in January, the formula for calculating MRR for the January cohort in March would be:

=Customers * (Subscription Price - Discount)

Using this formula, you can calculate MRR for each cohort in each month and use this information to identify trends in customer behavior and make informed decisions about pricing, marketing, and customer retention strategies.

In conclusion, calculating monthly recurring revenue cohort analysis is an essential tool for any business that relies on subscription-based revenue models. This analysis helps businesses understand how much revenue they can expect to earn from their customers over time, which is crucial for making informed decisions about pricing, marketing, and customer retention strategies. By using AirTable to calculate MRR cohort analysis, businesses can easily track revenue generated by each cohort of customers and use this information to optimize their subscription-based revenue models.

How Do You Calculate Monthly Recurring Revenue Cohort Analysis in AirTable

AirTable itself isn’t naturally geared towards letting you calculate complex metrics like Monthly Recurring Revenue Cohort Analysis. As an alternative, teams typically use products like Arithmix to import data from AirTable and build out dashboards.

What is Arithmix?

Arithmix is the next generation spreadsheet - a collaborative, web-based platform for working with numbers that’s powerful yet easy to use. With Arithmix you can import data from systems like AirTable, combine it with data from other systems, and create calculations like Monthly Recurring Revenue Cohort Analysis.

In Arithmix, data is organized into Tables and referenced by name, not by cell location like a spreadsheet, simplifying calculation creation. Data and calculations can be shared with others and re-used like building blocks, vastly streamlining analysis, model building, and reporting in a highly scalable and easy to maintain platform. Data can be edited, categorized (by dimensions) and freely pivoted. Calculations are automatically copied across a dimension - eliminating copy and paste of formulas.

Arithmix is fully collaborative, giving your entire team access to your numbers and the ability to work together seamlessly.

Calculating Monthly Recurring Revenue Cohort Analysis in Arithmix

Calculating metrics like Monthly Recurring Revenue Cohort Analysis is simple in Arithmix. Once you've created your free account, you’ll be able to import your AirTable data, and use it to create natural language formulas for metrics like Monthly Recurring Revenue Cohort Analysis.

Arithmix is designed to give you the power to build any calculations you want on top of your AirTable data, while also being easy to use and collaborate on. You can share your dashboards with users inside and outside of your organisation, making it easy to empower your whole team.