3. Retention > Upsell Higher Plans
Upsell higher plans to reduce SaaS churn
Selling to existing customers is easier and cost-effective. Upselling higher plans and upgrades to current customers is the best technique to increase revenue, retention, and revenue – and it helps you reduce churn because customers who upgrade are more likely to stay.
● PERSUASION
How to use the technique
- Use customer history for offering upsells. For instance, sending an upsell offer when a customer completes a milestone or when a customer refers your product to a friend. Use data and behavioral analysis for pitching upsell offers at the right time. We have crafted this amazing free churn optimization framework. where you can find more details.
- Send emails with upsell offers. Again, use segmentation to send upgrade offers to appropriate customers. Add prominent CTA, highlight benefits of the upgrade, and share customer testimonials.
- Use in-app upsell notifications. This works great for reducing churn and improving engagement. You can lock advanced features, notify customers to upgrade so they can unlock them.
- Offer a free trial of the upgraded version. Upgrading plan for free is a great way to retain customers. Let customers explore the upgraded version and once they get value from it, they will switch to it.
- Share the benefits of the upsell. Make it appealing. Use emotional triggers. Share testimonials. Show how they will get value.
- Get feedback for improvement. Collect data from customers who accept the upsell offer and those who don’t. Use feedback for improving your offer, pitch, and other issues. Focus on conversion optimization. Get access to our free churn optimization framework on conversion optimization.
Mistakes to avoid
- Upselling to unhappy customers will make them churn. Don’t do it. Use data for upselling and only target happy customers.
- Upselling at the wrong time. Upselling to a customer who has an open ticket with customer support isn’t a good idea. Choose an appropriate time for pitching the upsell to boost conversions.
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A survey conducted by Pacific Crest and For Entrepreneurs on SaaS growth rates, CAC, churn rate, and other metrics revealed that fastest growing SaaS companies rely more on upsells and a major percentage of their revenue comes from existing customers who opt for upsells. The faster a customer moves from free trial to paid customer to repeat customer, the likelihood of that customer sticking with your app increases significantly.
Upsell
Fastest growing SaaS companies rely more on upsells and a major percentage of their revenue comes from existing customers who opt for upsells
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