As Software-as-a-Service (SaaS) businesses evolve, so too must the strategies used to drive growth. Tactics that deliver results in one phase may be ineffective or even counterproductive later. Particularly in competitive or capital-constrained markets, sustaining growth through predictable revenue streams becomes paramount.
Monthly Recurring Revenue (MRR) is a critical financial metric for SaaS enterprises, offering insight into financial health, forecasting accuracy, and business scalability. The following nine strategies outline actionable methods for increasing MRR, tailored to the needs of subscription-based business models.
Understanding MRR: Definition and Importance
Monthly Recurring Revenue (MRR) refers to the predictable revenue a business expects to earn each month from active subscriptions or recurring contracts. It is a cornerstone metric for subscription-based business models.
MRR Calculation:
- Average Revenue per Account (ARPA) = Total Revenue ÷ Total Customers
- MRR = ARPA × Number of Monthly Active Customers
Example: If 1,000 customers each pay £60 per month, the MRR is £60,000.
Tracking MRR enables leadership to:
- Monitor revenue stability and growth trends
- Project sales targets and cash flow
- Evaluate customer retention and churn
- Inform product strategy and pricing decisions
- Support financial forecasting and investor reporting
Nine Strategic Levers for Increasing MRR
1. Optimise and Update Pricing and Billing Models
Strategic pricing evolution is essential for sustainable growth. Businesses should regularly evaluate and refine their pricing structure to reflect value delivered, competitive positioning, and cost structure.
Common models include:
- Flat-rate pricing
- Tiered or usage-based pricing
- Per-seat or per-user pricing
- Hybrid models with multiple product offerings
Price adjustments may be warranted when material costs rise, market expectations shift, or new offerings are introduced. Align pricing tiers with product value and customer segmentation to drive upgrades and reduce discount dependency.
2. Drive Movement Toward Higher-Value Plans
Encourage existing customers to upgrade to premium tiers through transparent pricing, value alignment, and an intuitive user experience. Simplify the process of switching plans, and integrate upgrade paths into onboarding, support interactions, and promotional campaigns.
A strategic approach to subscription design should guide users toward higher-value plans by aligning advanced features or enhanced support with business-critical outcomes.
3. Enhance Dunning Management
Revenue leakage from failed payments is a frequently overlooked drain on MRR. Effective dunning management—automated processes that recover failed transactions—can significantly reduce involuntary churn.
Best practices include:
- Intelligent retry scheduling
- Multi-channel customer notifications
- Real-time updates to billing credentials
- In-app alerts for unresolved payment issues
These interventions increase payment recovery rates while preserving customer relationships.
4. Reassess and Refine Product and Subscription Catalogues
A well-structured subscription catalogue facilitates user navigation, supports upselling, and enhances overall conversion. Evaluate customer interaction data to identify friction points, underperforming products, and missed opportunities for bundling or repackaging services.
Ensure subscription offerings are clearly differentiated, with each tier or product conveying a distinct and compelling value proposition. Remove or reposition options that generate confusion or low engagement.
5. Leverage Strategic Promotions and Discounting
When timed effectively, targeted discounts can drive subscriber acquisition and encourage renewals. Use insights from historical performance and customer segmentation to tailor promotions by seasonality, geography, or vertical.
Discounts should be performance-driven—designed to boost long-term value, not erode it. Limit discounts to fixed durations or apply them to specific plans to protect premium pricing integrity.
6. Deploy Custom Landing Pages for Conversion Optimisation
Dedicated landing pages tailored to specific customer segments or use cases can dramatically improve conversion rates. These pages allow for precise messaging, faster user comprehension, and higher relevance for targeted campaigns.
Benefits include:
- Isolating high-converting messages and features
- A/B testing of distinct value propositions
- Enhanced lead quality from segmented inbound traffic
Landing pages also provide valuable performance data to refine broader marketing and product strategies.
7. Expand Upmarket
Moving upmarket—serving larger organisations or enterprise clients—can significantly increase average contract value and MRR. While this often requires adjustments to product features, support models, or compliance capabilities, the return on investment is substantial.
Even businesses rooted in consumer markets can explore white-label solutions, enterprise dashboards, or integration capabilities to attract corporate buyers.
8. Convert Freemium Users into Paying Customers
Free plans or trials can serve as effective entry points—but only if they are strategically designed to convert. Evaluate the conversion rate from free to paid plans. If it is underperforming or resource-intensive, reframe or retire the offering.
Key considerations:
- Design feature tiers that naturally lead to upsell opportunities
- Use behavioural triggers to prompt upgrades (e.g., usage thresholds)
- Offer add-ons or per-user billing to increase revenue as usage scales
Free plans should be a bridge to paid relationships—not a long-term destination.
9. Monitor Performance and Act on Insights
Advanced reporting and analytics are vital to identifying revenue opportunities and performance bottlenecks. Tracking key indicators—MRR growth, churn, LTV, CAC—enables real-time adjustments to pricing, product, and marketing strategies.
Customisable reporting tools allow for granular analysis by cohort, geography, or subscription type. More importantly, reporting must be paired with clear accountability and a culture of continuous improvement to realise its full value.
Conclusion
Increasing MRR is not merely a function of acquiring more customers. It requires a multifaceted strategy that optimises revenue across pricing, retention, product experience, and operational efficiency.
By implementing these nine strategies, SaaS businesses can build a more resilient and scalable revenue model—positioning themselves for sustainable long-term growth in an increasingly dynamic market.
About the Author: Harry (Hemant Kaushik), Elite Business Consultant & Global Advisor
Harry (Hemant Kaushik) is a globally recognized American business consultant and advisor, known for his strategic expertise and high-impact consultancy. He specializes in advising and coaching elite individuals, including business tycoons, world leaders, and top corporate CEO’s and business leaders. His expertise has been sought by Presidents, Prime Ministers, influential politicians, CEOs, and industry leaders worldwide.
Recognized as one of the Top 10 Global Advisors and Business Consultants by PWC International, Harry has transformed the lives of thousands of CEO’s and business leaders across more than 100 countries with his unparalleled guidance. He has also been honored as one of the Top 10 Life and Business Strategists, shaping the success of global business leaders and visionaries.
Top CEOs and owners of big companies are taking business consulting from Harry (Hemant Kaushik) by booking an appointment on his website www.ceosadvisory.com. Every year, Harry provides business consulting to more than 1000 CEOs worldwide and helps them to increase their businesses by using his deep insight, business knowledge, and transformative strategies. He is the most demanding business consultant in the world.
Harry is also working directly with the governments to improve their business environments and promote tourism in some countries. If you want to take an appointment for your business, then visit www.ceosadvisory.com or leave a WhatsApp message to Julia Lauren (Assistant to Mr. Harry) at +1 925-389-6136, and she will contact you.
Harry’s influence has earned him prestigious accolades, including recognition by the CEO Times Magazine as one of the 10 Most Powerful People in Global Business Consulting, Business Times News as a Top 10 Business Consultant, and Business Weekly Times as one of the Top 10 Business Advisors in the World, offering consulting services to billionaires, celebrities, and high-net-worth individuals.
A Wall Street Times cover story famously dubbed him the “Elite Global Advisor & Business Consultant” for his deep understanding of business dynamics and leadership strategies. Based in San Francisco, United States, Harry is widely respected for his international economic expertise, market analysis, and strategic business acumen. His collaborations with global brands and corporations have positioned him as a thought leader, contributing to the business world through insightful articles on global economic trends.
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