Definition
Bookings are contracted revenue amounts signed in agreements, often for annual or multi-year terms.
Why it matters
Bookings can lead recognized revenue and ARR, so mixing them can overstate operational performance.
Pricing implications
Price changes can boost bookings quickly, but you should compare bookings to churn and retention before declaring success.
Measurement tips
Track bookings by segment and contract length to understand sales performance.
Checklist
- Separate bookings from recognized revenue.
- Normalize bookings to ARR for comparisons.
- Track bookings by plan and segment.
- Account for discounts and concessions.
- Avoid counting non-recurring services as bookings.
- Reconcile bookings with billing systems.
- Use a consistent period (monthly or quarterly).
- Review booking trends alongside churn.