Using the Right Metrics with Service Provider Customers

by Executive Conversation on November 10, 2009

Targeting customers in the service provider space? If you want to gain credibility and create differentiation, you’ll have to brush up on that market’s unique industry-specific metrics.

But how do you find the right metrics for your targeted customer?

We’ve developed this short format overview for exactly that purpose. In addition, use Analyst Reports. These reports used to benchmark companies are an ideal resource for identifying industry and customer-specific metrics.

Service Providers

Revenue Growth

Measured as year-over-year sales

Market Share

The percentage of the total available market being serviced by a specific company.

ARPU
(Average Revenue
per User)

Revenue during a specific period of time divided by the average number of customers during the same period.

Customer Churn

Calculated by dividing the number of customers who cancel service during a period of time by the total number of customers at the beginning of that period. Also called turnover.

Net Adds

Gross additions of new customers during a period of time minus the number of customers that cancel service in the same period.

Free Cash Flow

Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) less Capital Expenditures & Working Capital changes.

OIBDA
(Operating Income before Depreciation & Amortization)

Companies use it to show profitability in continuing business activities that excludes the effects of capitalization and tax structure.

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