How’s your SaaS business doing? It’s hard to answer that question these days without using rolling metrics.
Founders will often choose a window of time—usually the last 30 days—as the main reference point for the short-term performance of their business. 30 day metrics that move and stay constantly updated are called rolling metrics, and most good SaaS tools these days will show you them.
But 30 day rolling metrics are tricky. They’re not the same as a set of financial statements you produce for your business at the end of each month, and looking at them can some times straight up deceive you about the state of your business.
Here’s how to make sure that doesn’t happen.
1. What exactly are rolling metrics?
Rolling (or sliding window) metrics are any SaaS metric that constantly changes or updates the days that are included in the calculation.
30 day rolling revenue is one popular metric: it includes all the revenue your business has earned over the last 30 days including today, and not including whatever day it was 31 days ago. Tomorrow, that metric will drop another day to make room for tomorrow’s revenue, and so on.
2. What are the benefits of using them?
30-day rolling metrics are useful in particular because:
- They’re up to date and real-time
- They take into account the last 30 days, giving you a sense of long-term performance as well
30 day rolling metrics are a good way to connect the short term, day-to-day performance of your business to the long term.
Unlike a monthly set of financial statements, which you have to wait for, rolling metrics are constantly up to date. But unlike live analytics, they show you trends in your performance and help you get a sense of where things are going in the long term.
It’s easier than ever to get loads of up to date data about your business, but relying on just the last few days of information can be limiting. 30 day rolling metrics can be a good way to maintain perspective and to keep yourself from making any impulsive decisions.
Things might be going really well or really badly today, sure, but today isn’t always representative of how things are going as a whole. The last 30 days are usually much more representative.
3. What do rolling metrics not show you?
30-day rolling metrics can be tricky because:
- Accurate numbers from shorter periods disappear
- You cannot compare rolling metrics using a shorter period than they were calculated with
The advantage of rolling metrics is also their main drawback: they smooth out any short-term spikes or dips in the data.
Getting rid of the spikes and dips in your data can be bad if those spikes and dips contain important information about the performance of your business.
What’s important to remember with rolling metrics is that the calculation period moves. It doesn’t only take in a new hour, day or week, it also drops one away.
This is fine if you are trying to find out if you are doing better or worse in the long run. This is not fine if you need to know which week’s ad campaign was the most effective.
How do I know if I have a rolling metric or a regular metric?
That’s something your analytics app provider should clearly tell you.
I currently serve rolling metrics only in the weekly follow-up report. FirstOfficer.io is for strategic planning and trouble-shooting, so you must be able see the exact numbers – rolling metrics aren’t a good fit for that purpose.
There’s also an information sheet on how to read the weekly email report, which clearly tells which numbers are rolling. I also changed the naming of the metrics to better differentiate the rolling metrics.