How to Boost Your Net Dollar Retention: 8 Tips for SaaS Leaders

March 28, 2025

Tamanna Mishra

The best SaaS companies don’t just retain customers. They expand them.

That’s why Net Dollar Retention (NDR) is the metric that separates high-growth SaaS businesses from the laggards. It’s that one metric that SaaS leaders simply can’t afford to ignore anymore.

Top SaaS companies maintain NDR above 120%. That means they generate more revenue from existing customers than they lose from churn. SaaS companies with high NDR are more resilient, more profitable, and better positioned to dominate their market. 

Investors and boards care about NDR because it signals sustainable growth. A high NDR means your company can scale without constantly burning resources on new customer acquisition.

But real life (and business) works differently. Most SaaS businesses struggle with churn, stalled expansion, and weak retention. (But not if your sales to customer success handoffs are seamless and truly complete. That’s where Sybill’s Deal Summaries act as a guard rail. Click here to know more.)

What do they really need to win at Net Dollar Retention? A clear strategy to drive expansion revenue, reduce churn, and create sticky customer relationships.

In this blog, we’ll break down:

  • What Net Dollar Retention is and why it matters.
  • How to calculate Net Dollar Retention the right way.
  • 8 battle-tested strategies to increase your NDR and drive long-term SaaS growth.

Let’s go.

What is Net Dollar Retention?

Net Dollar Retention (NDR) is one of the most critical metrics for SaaS companies, measuring how much revenue is retained and expanded from existing customers over a given period.

Unlike customer retention, which only tracks churn, NDR factors in both expansion revenue (upsells, cross-sells, upgrades) and contraction (downgrades, churn). It tells you whether your existing customer base is growing or shrinking in value over time.

Importance of Net Dollar Retention (NDR) for SaaS Growth

Investors and stakeholders prioritize NDR as a core indicator of sustainable revenue growth because it reflects a company’s ability to scale without excessive reliance on new customer acquisition.

A high NDR signals that customers aren’t just sticking around. They’re spending more over time. Companies with NDR above 120% grow 2-3x faster than those struggling to keep it above 100%. In fact, industry benchmarks show that publicly traded SaaS companies with NDR above 130% consistently outperform their competitors in market valuation and revenue growth.

For example, Snowflake, a SaaS leader, boasts an NDR above 150%, demonstrating the power of continuous expansion revenue. Meanwhile, SaaS companies with NDR below 100% often struggle with shrinking revenues, as customer churn erodes growth.

Example: What your NDR reveals

  • If your NDR is 120%, you’re increasing revenue from your existing customers alone—without needing to acquire new customers.
  • If your NDR is below 100%, you’re losing more revenue from churn and downgrades than you’re gaining from expansions.

What is a good NDR?

Top performing SaaS companies maintain an NDR above 120%, proving that customer expansion is just as important - if not more - than acquisition.

For a deeper understanding of Net Dollar Retention, click here.

How to Calculate Net Dollar Retention (NDR)

Net Dollar Retention (NDR) is a key metric that helps SaaS businesses measure revenue retention and expansion from their existing customer base. A strong NDR means your company is growing revenue without relying solely on new customer acquisition.

Net Dollar Retention formula

How to calculate Net Dollar Retention (NDR)?
Net Dollar Retention Formula

Where:

  • Starting MRR (Monthly Recurring Revenue): Revenue from existing customers at the start of the period.
  • Expansion MRR: Additional revenue from upsells, cross-sells, or increased usage.
  • Churn MRR: Revenue lost due to customer cancellations.
  • Contraction MRR: Revenue lost due to downgrades or reduced spending.

Example of Net Dollar Retention formula calculation

Let's say:

  • Your Starting MRR = $100K
  • Your Expansion MRR (upsells, cross-sells) = $20K
  • Your Churn MRR (lost customers) = $10K

Your NDR would be:

Real world net dollar retention formula & calculation
Real world net dollar retention formula & calculation

What NDR means for your SaaS business

  • If NDR is above 100%, you’re growing revenue from your existing customers.
  • If NDR is below 100%, you're losing more revenue from churn and downgrades than you're gaining from expansions.

Benchmark: Top SaaS companies aim for an NDR between 110-130% for strong and sustainable growth.

8 Tips to Boost Net Dollar Retention (NDR)

Net Dollar Retention (NDR) is the ultimate growth metric for modern SaaS sales teams. By reducing churn, increasing expansion revenue, and improving customer experience, you can ensure steady revenue growth without solely relying on new customer acquisition.

 Here’s how to optimize NDR with proven, high-impact strategies.

How to improve net dollar retention in 8 easy steps
How to improve net dollar retention in 8 easy steps

1. Reduce churn with proactive customer success

Keeping existing customers is significantly more cost-effective than acquiring new ones.

How to implement it:

  • Track early churn signals such as low login frequency, rising support tickets, or declining feature usage.
  • Assign Customer Success Managers (CSMs) to high-value accounts for proactive engagement.
  • Automate churn prevention workflows with email sequences, personalized check-ins, and targeted outreach.
Pro Tip: Implement Customer Health Scores (CHS) to identify at-risk accounts and intervene before they churn.

2. Drive expansion revenue with a customer-first approach

Expansion revenue directly improves NDR, and usage-based pricing models have become a winning strategy. Companies like AWS and Snowflake have mastered this by allowing customers to scale their usage rather than forcing predefined tiers.

How to implement it:

  • Identify customers approaching their usage limits and offer tiered discounts for expanding usage.
  • Introduce “pay as you grow” options that scale alongside customer needs.
  • Offer “early access” pricing for premium features before full rollout to encourage upgrades.
Pro Tip: Gamify adoption. Show customers how their usage compares to industry peers to drive competitive engagement.

3. Create stickiness with a strong product-led growth or product-led sales strategy

The deeper a customer integrates into your product, the less likely they are to churn.

How to do it:

  • Encourage customers to set up integrations and automations that make switching difficult.
  • Improve in-product adoption with guided tutorials, in-app messages, and feature recommendations.
  • Leverage network effects (e.g., referral programs, team-based collaboration features) to increase engagement.
Pro Tip: Identify and nurture power users. They are the least likely to churn and can influence others in their organization.

4. Personalize engagement with AI-driven insights

AI helps sales and customer success teams anticipate churn risks and identify expansion opportunities.

How to do it:

  • Use AI-powered segmentation to group customers based on behavior, usage, and likelihood of renewal.
  • Automate personalized follow-ups with insights-driven recommendations and timely interventions.
  • Analyze past churn cases and flag similar risk patterns in current customers to take preventive action.
Pro Tip: AI can detect "silent churn” - customers who haven’t officially canceled but have stopped engaging with your reps, CS, or the product. Catch them before they leave.

5. Improve customer support & self-service options

Customer support is one of the biggest drivers of churn. 65% of customers report switching providers after just one poor support experience.

How to improve it:

  • Reduce response times: Companies with sub-2-hour response rates see higher retention than those with slower support.
  • Build a robust knowledge base: Customers prefer self-service first - chatbots and AI-powered knowledge centers reduce churn.
  • Implement CSM-led support for high-value accounts, ensuring a seamless experience.
Pro Tip: Faster response times directly improve NDR. Aim for under a 2-hour response time for high-value customers.

6. Focus on onboarding experience to drive early product adoption

Poor onboarding is one of the biggest drivers of early churn in SaaS. Studies show that 63% of customers consider onboarding a key factor in their purchasing decision, and those with a bad experience are far more likely to churn within the first few months.

A strong onboarding experience ensures that customers reach their first "aha moment" quickly - when they see the core value of your product in action. The faster this happens, the higher your retention and expansion potential.

How to do it:

  • Offer guided onboarding flows with clear milestones and in-app progress tracking to help users stay engaged.
  • Use AI-driven insights to personalize onboarding based on user type, goals, and behavioral patterns. First-time users need hand-holding, while power users may prefer quick self-serve guides.
  • Provide white-glove onboarding for high-value or enterprise customers, ensuring a seamless and customized start that drives long-term adoption.
  • Use video tutorials, interactive walkthroughs, and personalized check-ins to ensure users fully understand key features and benefits.
  • Identify at-risk users early. If a user hasn’t completed onboarding in the first few days, trigger automated outreach or a CSM intervention.
Pro Tip: Customers who complete onboarding within 7 days have 2x higher retention rates than those who don’t. Watch out!

7. Develop a customer expansion playbook

Proactively driving expansion revenue ensures continuous revenue growth.

How to do it:

  • Set clear upsell and cross-sell triggers based on customer behavior and usage patterns.
  • Train Customer Success and Account Management teams on "value-based" upselling strategies.
  • Position product upgrades as natural next steps rather than sales-driven pitches.
Pro Tip: "Land and expand" works best when sales teams focus on small, early wins before introducing larger commitments.

8. Reduce involuntary churn with proactive account management

20-40% of churn is involuntary, often due to failed payments, credit card issues, or account inactivity.

How to do it:

  • Implement automated dunning systems that send alerts and retries for failed payments.
  • Identify inactive accounts early and launch personalized win-back campaigns.
  • Encourage annual contracts instead of monthly billing to stabilize revenue.
Pro Tip: Offer small incentives (discounts, added features) for customers who proactively update their billing details before issues arise.

Conclusion: Net Dollar Retention is a Growth Lever, Not Just Another Metric

Net Dollar Retention (NDR) is a crucial predictor of sustainable, scalable revenue growth for SaaS enterprises. 

SaaS companies that consistently improve churn reduction, expansion strategies, and customer engagement unlock recurring revenue growth without the pressure of constant new acquisition.

What’s better? They save dollars doing this, because acquiring a single new customer costs 5x more than retaining an existing one. In fact, a minor 5% increase in customer retention can boost profits by up to a staggering 75%!

Still unsure why most successful SaaS businesses don’t leave NDR to chance? They proactively track early churn signals, personalize upsell strategies, and leverage automation to improve retention. 

The result? Higher NDR, stronger customer relationships, and long-term profitability. In sustainable growth.

How Sybill can help improve net dollar retention

Sybill empowers SaaS companies and teams with AI-driven insights to optimize NDR at every stage of the customer journey.

  • AI-Powered Call Summaries – Ensure that customer success teams never miss a beat from customer interactions across the buying journey, with Magic Summary.
  • Personalized Customer Engagement – Automate follow-ups tailored to each customer’s needs and behaviors with AI Follow Up Email.
  • Proactive Churn Prevention – Detect early disengagement signals with AI-driven behavioral insights from calls.
  • Expansion Revenue Optimization – Identify upsell and cross-sell opportunities based on real-time engagement levels and interests.

Ready to Take Control of Your Net Dollar Retention with AI?

Boost NDR.

Drive expansion.

Retain customers for longer.

Try Sybill for free today and see how AI-powered sales and customer success insights can boost your SaaS growth.

Get started with Sybill

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Table of Contents

Get started with Sybill

Accelerate your sales with your personal assistant

Get Started Free

The best SaaS companies don’t just retain customers. They expand them.

That’s why Net Dollar Retention (NDR) is the metric that separates high-growth SaaS businesses from the laggards. It’s that one metric that SaaS leaders simply can’t afford to ignore anymore.

Top SaaS companies maintain NDR above 120%. That means they generate more revenue from existing customers than they lose from churn. SaaS companies with high NDR are more resilient, more profitable, and better positioned to dominate their market. 

Investors and boards care about NDR because it signals sustainable growth. A high NDR means your company can scale without constantly burning resources on new customer acquisition.

But real life (and business) works differently. Most SaaS businesses struggle with churn, stalled expansion, and weak retention. (But not if your sales to customer success handoffs are seamless and truly complete. That’s where Sybill’s Deal Summaries act as a guard rail. Click here to know more.)

What do they really need to win at Net Dollar Retention? A clear strategy to drive expansion revenue, reduce churn, and create sticky customer relationships.

In this blog, we’ll break down:

  • What Net Dollar Retention is and why it matters.
  • How to calculate Net Dollar Retention the right way.
  • 8 battle-tested strategies to increase your NDR and drive long-term SaaS growth.

Let’s go.

What is Net Dollar Retention?

Net Dollar Retention (NDR) is one of the most critical metrics for SaaS companies, measuring how much revenue is retained and expanded from existing customers over a given period.

Unlike customer retention, which only tracks churn, NDR factors in both expansion revenue (upsells, cross-sells, upgrades) and contraction (downgrades, churn). It tells you whether your existing customer base is growing or shrinking in value over time.

Importance of Net Dollar Retention (NDR) for SaaS Growth

Investors and stakeholders prioritize NDR as a core indicator of sustainable revenue growth because it reflects a company’s ability to scale without excessive reliance on new customer acquisition.

A high NDR signals that customers aren’t just sticking around. They’re spending more over time. Companies with NDR above 120% grow 2-3x faster than those struggling to keep it above 100%. In fact, industry benchmarks show that publicly traded SaaS companies with NDR above 130% consistently outperform their competitors in market valuation and revenue growth.

For example, Snowflake, a SaaS leader, boasts an NDR above 150%, demonstrating the power of continuous expansion revenue. Meanwhile, SaaS companies with NDR below 100% often struggle with shrinking revenues, as customer churn erodes growth.

Example: What your NDR reveals

  • If your NDR is 120%, you’re increasing revenue from your existing customers alone—without needing to acquire new customers.
  • If your NDR is below 100%, you’re losing more revenue from churn and downgrades than you’re gaining from expansions.

What is a good NDR?

Top performing SaaS companies maintain an NDR above 120%, proving that customer expansion is just as important - if not more - than acquisition.

For a deeper understanding of Net Dollar Retention, click here.

How to Calculate Net Dollar Retention (NDR)

Net Dollar Retention (NDR) is a key metric that helps SaaS businesses measure revenue retention and expansion from their existing customer base. A strong NDR means your company is growing revenue without relying solely on new customer acquisition.

Net Dollar Retention formula

How to calculate Net Dollar Retention (NDR)?
Net Dollar Retention Formula

Where:

  • Starting MRR (Monthly Recurring Revenue): Revenue from existing customers at the start of the period.
  • Expansion MRR: Additional revenue from upsells, cross-sells, or increased usage.
  • Churn MRR: Revenue lost due to customer cancellations.
  • Contraction MRR: Revenue lost due to downgrades or reduced spending.

Example of Net Dollar Retention formula calculation

Let's say:

  • Your Starting MRR = $100K
  • Your Expansion MRR (upsells, cross-sells) = $20K
  • Your Churn MRR (lost customers) = $10K

Your NDR would be:

Real world net dollar retention formula & calculation
Real world net dollar retention formula & calculation

What NDR means for your SaaS business

  • If NDR is above 100%, you’re growing revenue from your existing customers.
  • If NDR is below 100%, you're losing more revenue from churn and downgrades than you're gaining from expansions.

Benchmark: Top SaaS companies aim for an NDR between 110-130% for strong and sustainable growth.

8 Tips to Boost Net Dollar Retention (NDR)

Net Dollar Retention (NDR) is the ultimate growth metric for modern SaaS sales teams. By reducing churn, increasing expansion revenue, and improving customer experience, you can ensure steady revenue growth without solely relying on new customer acquisition.

 Here’s how to optimize NDR with proven, high-impact strategies.

How to improve net dollar retention in 8 easy steps
How to improve net dollar retention in 8 easy steps

1. Reduce churn with proactive customer success

Keeping existing customers is significantly more cost-effective than acquiring new ones.

How to implement it:

  • Track early churn signals such as low login frequency, rising support tickets, or declining feature usage.
  • Assign Customer Success Managers (CSMs) to high-value accounts for proactive engagement.
  • Automate churn prevention workflows with email sequences, personalized check-ins, and targeted outreach.
Pro Tip: Implement Customer Health Scores (CHS) to identify at-risk accounts and intervene before they churn.

2. Drive expansion revenue with a customer-first approach

Expansion revenue directly improves NDR, and usage-based pricing models have become a winning strategy. Companies like AWS and Snowflake have mastered this by allowing customers to scale their usage rather than forcing predefined tiers.

How to implement it:

  • Identify customers approaching their usage limits and offer tiered discounts for expanding usage.
  • Introduce “pay as you grow” options that scale alongside customer needs.
  • Offer “early access” pricing for premium features before full rollout to encourage upgrades.
Pro Tip: Gamify adoption. Show customers how their usage compares to industry peers to drive competitive engagement.

3. Create stickiness with a strong product-led growth or product-led sales strategy

The deeper a customer integrates into your product, the less likely they are to churn.

How to do it:

  • Encourage customers to set up integrations and automations that make switching difficult.
  • Improve in-product adoption with guided tutorials, in-app messages, and feature recommendations.
  • Leverage network effects (e.g., referral programs, team-based collaboration features) to increase engagement.
Pro Tip: Identify and nurture power users. They are the least likely to churn and can influence others in their organization.

4. Personalize engagement with AI-driven insights

AI helps sales and customer success teams anticipate churn risks and identify expansion opportunities.

How to do it:

  • Use AI-powered segmentation to group customers based on behavior, usage, and likelihood of renewal.
  • Automate personalized follow-ups with insights-driven recommendations and timely interventions.
  • Analyze past churn cases and flag similar risk patterns in current customers to take preventive action.
Pro Tip: AI can detect "silent churn” - customers who haven’t officially canceled but have stopped engaging with your reps, CS, or the product. Catch them before they leave.

5. Improve customer support & self-service options

Customer support is one of the biggest drivers of churn. 65% of customers report switching providers after just one poor support experience.

How to improve it:

  • Reduce response times: Companies with sub-2-hour response rates see higher retention than those with slower support.
  • Build a robust knowledge base: Customers prefer self-service first - chatbots and AI-powered knowledge centers reduce churn.
  • Implement CSM-led support for high-value accounts, ensuring a seamless experience.
Pro Tip: Faster response times directly improve NDR. Aim for under a 2-hour response time for high-value customers.

6. Focus on onboarding experience to drive early product adoption

Poor onboarding is one of the biggest drivers of early churn in SaaS. Studies show that 63% of customers consider onboarding a key factor in their purchasing decision, and those with a bad experience are far more likely to churn within the first few months.

A strong onboarding experience ensures that customers reach their first "aha moment" quickly - when they see the core value of your product in action. The faster this happens, the higher your retention and expansion potential.

How to do it:

  • Offer guided onboarding flows with clear milestones and in-app progress tracking to help users stay engaged.
  • Use AI-driven insights to personalize onboarding based on user type, goals, and behavioral patterns. First-time users need hand-holding, while power users may prefer quick self-serve guides.
  • Provide white-glove onboarding for high-value or enterprise customers, ensuring a seamless and customized start that drives long-term adoption.
  • Use video tutorials, interactive walkthroughs, and personalized check-ins to ensure users fully understand key features and benefits.
  • Identify at-risk users early. If a user hasn’t completed onboarding in the first few days, trigger automated outreach or a CSM intervention.
Pro Tip: Customers who complete onboarding within 7 days have 2x higher retention rates than those who don’t. Watch out!

7. Develop a customer expansion playbook

Proactively driving expansion revenue ensures continuous revenue growth.

How to do it:

  • Set clear upsell and cross-sell triggers based on customer behavior and usage patterns.
  • Train Customer Success and Account Management teams on "value-based" upselling strategies.
  • Position product upgrades as natural next steps rather than sales-driven pitches.
Pro Tip: "Land and expand" works best when sales teams focus on small, early wins before introducing larger commitments.

8. Reduce involuntary churn with proactive account management

20-40% of churn is involuntary, often due to failed payments, credit card issues, or account inactivity.

How to do it:

  • Implement automated dunning systems that send alerts and retries for failed payments.
  • Identify inactive accounts early and launch personalized win-back campaigns.
  • Encourage annual contracts instead of monthly billing to stabilize revenue.
Pro Tip: Offer small incentives (discounts, added features) for customers who proactively update their billing details before issues arise.

Conclusion: Net Dollar Retention is a Growth Lever, Not Just Another Metric

Net Dollar Retention (NDR) is a crucial predictor of sustainable, scalable revenue growth for SaaS enterprises. 

SaaS companies that consistently improve churn reduction, expansion strategies, and customer engagement unlock recurring revenue growth without the pressure of constant new acquisition.

What’s better? They save dollars doing this, because acquiring a single new customer costs 5x more than retaining an existing one. In fact, a minor 5% increase in customer retention can boost profits by up to a staggering 75%!

Still unsure why most successful SaaS businesses don’t leave NDR to chance? They proactively track early churn signals, personalize upsell strategies, and leverage automation to improve retention. 

The result? Higher NDR, stronger customer relationships, and long-term profitability. In sustainable growth.

How Sybill can help improve net dollar retention

Sybill empowers SaaS companies and teams with AI-driven insights to optimize NDR at every stage of the customer journey.

  • AI-Powered Call Summaries – Ensure that customer success teams never miss a beat from customer interactions across the buying journey, with Magic Summary.
  • Personalized Customer Engagement – Automate follow-ups tailored to each customer’s needs and behaviors with AI Follow Up Email.
  • Proactive Churn Prevention – Detect early disengagement signals with AI-driven behavioral insights from calls.
  • Expansion Revenue Optimization – Identify upsell and cross-sell opportunities based on real-time engagement levels and interests.

Ready to Take Control of Your Net Dollar Retention with AI?

Boost NDR.

Drive expansion.

Retain customers for longer.

Try Sybill for free today and see how AI-powered sales and customer success insights can boost your SaaS growth.

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