You’re out in the trenches, and you see how much easier your work becomes when your existing customers help you fill your new quotas with new purchases. It takes so much less work and effort, and you often manage to sell more expensive products than you do to new-to-you customers.
Existing customers are willing to pay you more because they love the experience of working with you and your product, they’ve already seen results, and they trust you to put their best interests first.
Your work experience, then, becomes more enjoyable too, which leads you to perform better on all metrics.
As successful entrepreneur Neil Patel writes, “upselling accomplishes three very good things: 1) deepens relationships, 2) raises the value that the customer receives, 3) increases the customer’s customer lifetime value (CLV). Upselling is a win-win. Customers get better stuff. You get more cash. And here’s the kicker: The customer is going to stay around longer.”
But go convince the c-suite that the vast majority of your time is better spent on building long-term relationships than on acquiring new customers.
To help you out, we’ve collected 39 upsell statistics and B2B case studies that you can take to higher management. Remember that different studies find different numbers, but the trends throughout the wealth of data we’ve found are pretty consistent.
Cost and Ease of Acquisition Statistics: New vs Existing Customers
1) It’s 68% more expensive to acquire $1 from a new customer than it is to upsell current customers (forEntrepreneurs) - Tweet this
2) It’s 4x more expensive to acquire a new dollar via upsell vs. through a new customer (forEntrepreneurs) - Tweet this
3) For SaaS companies, the median cost of acquisition of $1 from a new customer is $1.18. That means they’re losing money, at least for a while (more on that later). On the other hand, the median cost of acquisition of $1 from an upsell is $0.28 (forEntrepreneurs) - Tweet this
4) It’s 140% more expensive to acquire new customers than to renew current ones’ purchases. Every additional dollar you earn only costs you $0.13 (forEntrepreneurs).- Tweet this
5) It’s 9x more expensive to acquire new customers than to retain current ones (forEntrepreneurs).- Tweet this
6) 70-95% of revenue comes from upsells and renewals. Only 5-30% come from the initial sale (forEntrepreneurs).- Tweet this
Source: Totango via forEntrepreneurs
7) It’s 50% easier to sell to existing customers than to prospective customers (Clarity).- Tweet this
8) The probability of selling to an existing customer is 300-1,400% higher than selling to a prospective customer (Groove).- Tweet this
9) The probability of selling to a prospective is 5-20%, yet to an existing customer – 60-70% (Groove).- Tweet this
10) It’s 5-25% more expensive to acquire a new customer than it is to retain an existing customer (Harvard Business Review).- Tweet this
How Long it Takes to Earn Back Your Customer Acquisition Investment: New Customers vs. Upsell Statistics
11) Returning the investment in new customer acquisition takes over 1 year. Returning the investment in an upsell takes around 1 quarter. That’s almost a year less (InsightSquared).- Tweet this
12) If you only generate revenue from new ACV, expect to wait 2 years to return your investment. That, as opposed to only waiting 6 months to return your upsell acquisition costs (InsightSquared).- Tweet this
Source: Pacific Crest via InsightSquared
New Customers vs. Upsell Statistics: Which One is Up to 95% More Profitable?
13) Increasing customer retention by 5% increases profits by 25-95% (Harvard Business School).- Tweet this
14) A 5% increase in customer retention can increase a company’s profitability by 75% (Clarity).- Tweet this
15) 80% of your company’s revenue will come from 20% of your customers (Clarity).- Tweet this
16) Only 10% of B2B companies’ revenue comes from initial sales. 90% of the revenue comes from following sales (Marketo).- Tweet this
17) The average spend of a repeat customer is 67x higher than a new one (Chargebee).- Tweet this
18) The likelihood of a customer to make a second purchase is almost 30%. After they make that second purchase, the chance of a third purchase skyrockets to 50% (Shopify).- Tweet this
Source: RJMetrics via Shopify
19) After a year with your company, your top 10% of customers are worth an average of 6x the industry average. The top 1% are worth 18x more (Shopify).- Tweet this
Source: RJMetrics via Shopify
Upsell vs. Cross-Sell Statistics: Which One is 2,000% More Profitable?
20) Upsells generate 2,000% more sales than cross-sales (Convince & Convert).- Tweet this
21) Displaying slightly higher priced options than those in your visitors’ immediate view drives an average of 4.25% of the sales, 20x more than the standard cross-sales via recommended products (ConversionXL).- Tweet this
Successful vs. Less Successful Companies: How Do Upsell Stats Compare?
22) The median SaaS company generates 16% of its revenue through upsells. This doubles to 32% for the second largest group ($40-75 million in annual revenue), with a slight decline for the largest SaaS companies out there (over $75 million in annual revenue) (RJMetrics).- Tweet this
23) The most successful SaaS companies ($40 million and more in annual revenue) generate 28-32% of their revenue through upsells, vs. only 11% in the smallest SaaS companies (less than $1.25 million in annual revenue) (RJMetrics).- Tweet this
24) The median SaaS company generates 16% of its revenue through upsells. The fastest growing companies generate more revenue through upsells than the median stat – 17-37% (forEntrepreneurs).- Tweet this
25) Top 50% SaaS growers generate 4-13% more of their income through upsells than the bottom 50% growers (forEntrepreneurs).- Tweet this
26) The fastest growing companies (75% or more in year over year revenue growth) are 27% more likely to prioritize upsells than the slowest growing companies.- Tweet this
Source: Totango via SlideShare
27) Companies that generate $15M+ in annual revenue – and focus on upselling – grow more than twice as fast than those that don’t (Tomasz Tunguz).- Tweet this
Upsell Statistics in Action: B2B Case Studies that Show You How to Increase Your Revenue
28) Jeff Walker’s upsell formula: from a $5.99 book to a $197 product in 60 seconds, and onward to a $2,000 product within 10 days (VideoFruit).- Tweet this
29) Almost 50% of Hearsay Social’s revenue is generated through upsells (B2B News Network).- Tweet this
30) Salesforce generates 80% of its big deal revenue from top 10% of customers who buy 7 figure deals (Salesforce).- Tweet this
31) VideoFruit used upsells to generate over $30,000 in sales during a product launch (VideoFruit).- Tweet this
32) Boiler Supplies used upsells to create deeper and more valuable customer relationships (Innovative Marketing Resources).- Tweet this
33) AppDynamics is working toward generating 60-70% of its revenue through upsells, and is already enjoying more revenue, more referrals and more customer advocacy (Capterra).- Tweet this
34) VMware’s personalized upsell campaign generated 25% more prospects in the sales pipeline, as well as 45% more leads and conversions than a similar, yet non-personalized, campaign they did the previous year (Capterra).- Tweet this
35) A B2B company used predictive analytics and automation to increase 24% upsell wins (TSIA).- Tweet this
Despite the Statistics, Most Companies Aren’t Focused on Upsells. Stand Out of the Crowd Before They Do.
36) Over 83% of companies still don’t generate most of their revenue through upsells (Totango).- Tweet this
37) 39% only generate 1-20% of their revenue through upsells (Totango).- Tweet this
38) 13% of companies have seen the percentage of upsells remain the same or decline as a revenue source (Totango).- Tweet this
Source: Totango via SlideShare
39) The #1 challenge for 40% of customer success teams is gaining visibility into customer health and user behavior metrics, but less than 20% intend to make fixing it a top priority in 2017 (OpenView).- Tweet this
Don’t be one of these companies. Stand out and take advantage of this secret ingredient of top selling companies before your competitors find out about it. What’s the #1 thing you can do this week to take a step in the upsell direction?