sales
Upsell
Selling a more expensive or expanded version of what the customer already has.
Definition
Upsell is the practice of selling a higher-tier or expanded version of a product or service to an existing customer - moving from Pro to Enterprise, adding seats, adding modules. Upsell revenue is typically the cheapest growth available: existing customers already trust you, the sales cycle is short, and CAC is near zero. The rule of thumb in mature service businesses: 30-50% of new revenue should come from existing customer expansion, not new acquisition.
In your business
- →Build an upsell motion - existing customers convert at 5-10x the rate of new prospects
- →Tie upsell offers to milestones (usage thresholds, contract renewal, expansion in customer's business)
- →Account managers should have upsell targets, not just retention targets