Technology Lifecycle Pricing (Part 3): Maximizing Acquisition Effectiveness through Cross-sell and Up-sell of multiple products
New logo acquisition is the most expensive way for most companies to increase their revenue. On average it is much more cost efficient for SaaS companies to rely on up-sell/cross-sell and renewals to help bring blended CAC costs down. The most efficient SaaS companies all have net-retention scores over 100% for this reason. In fact, the top 20% have net-retention scores of over 120%.
- To help drive the land and expand strategy that is the hallmark of high net retention scores, you need to be able to intelligently pull three levers: Upsell, Usage, Retention.
- The challenge with these levers is that they present trade-offs that need to be balanced effectively using packaging, segmentation, and pricing.
- Even more so than earlier stages, this is an iterative process that requires research and customer insights, differentiation in skills within the sales organization, and understanding of your own limitations
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