The median Customer Acquisition Cost (CAC) for upsells is just $0.28 per $1, less than a quarter of the $1.18 spent to acquire $1 of revenue from a new customer

SaaS + Software
Statistic in Market Research

Statistic Info

This has a huge impact on unit economics and begins to explain why winning companies place such a large focus on upsells as they mature. The bigger your customer base, the bigger the opportunity to move the needle through upsells.

Upsells aren’t always easy, and depending on the dynamics of your business model they may not even seem like an option. I believe the average company focuses so much on growth through new accounts because that path seems larger, more obvious, and, frankly, easier. But, as we all know, oftentimes the hard thing to do and the right thing to do are one in the same.

RJMetrics

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The very best SAAS business has a negative churn rate and will have a Dollar Retention Rate of greater than 100%

Revenue per employee has been steadily increasing in SAAS companies. It serves as a great longitudinal measuring stick to understand the increasing or decreasing efficiency of the business

Japanese company Hitachi accounted for three percent of the world’s market for diagnostic imaging in 2017.

SaaS companies in the $7.5MM-$15MM range are among the fastest growers

More than two thirds of SAAS companies experienced annual churn rates of 5% or higher

The fastest growing SaaS companies scale their organizations rapidly, growing their teams by an average of 56% each year

Negative Churn and Expansion Revenue

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When determining Sales Capacity, “it’s worth noting that some percentage of new sales hires won’t meet expectations, so that should be taken into consideration when setting hiring goals. Typically we have seen failure rates around 25-30% for field sales reps, but this varies by company. The failure rate is lower for inside sales reps. can be counted as half of a productive rep”

Net-revenue churn improves with larger Average Contract Value (ACV), likely due to more structural churn among SMB customers and higher switching costs associated with larger contracts

More Market Research Stats

SaaS solutions have the highest security features with 95% security failures due to human error

54% treat upselling and add-on sales as high priority

SAAS companies invest between 80% and 120% of their revenue in sales and marketing in the first 5 years of their existence

The average company booking professional services revenue on new deals is equivalent to 16% of the first year subscription value. Professional services margins are approximately 22%

Customer Acquisition Cost (CAC) = sum of all sales & marketing expenses/ number of new customers added

If you are charging $500 per month, you can afford to spend up to 12x that amount (i.e. $6,000) on acquiring a new customer

Companies that spend more on sales and marketing (as a % of revenue) generally grew at a faster rate than those that spent less

Investment in marketing automation tools is expected to reach $25 billion by the year 2023

The average SaaS business generates 16% of its new Annual Contract Value (ACV) from upselling to existing customers

Over the past five years, the Global Biotechnology industry has grown by 2.0% to reach revenue of $301bn in 2019.

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