Sales and Marketing Efficiency 

Sales and Marketing Efficiency measures how effectively a business converts its sales and marketing investments into revenue. It’s often expressed through ratios or return-on-investment metrics that show the profitability and scalability of go-to-market efforts. 

A key formula: 

Sales Efficiency = Net New ARR / Sales and Marketing Expenses    

For example, if a company spends AED 1,000,000 on sales and marketing and generates AED 2,000,000 in net new Annual Recurring Revenue (ARR), its sales efficiency is 2.0 — meaning it generates AED 2 for every dirham spent. 

Tracking this metric helps businesses optimize customer acquisition costs (CAC), adjust marketing strategies, and scale growth sustainably.