Comments on: SaaS Revenue | The Beauty of Upselling and Upgrades http://chaotic-flow.com/saas-revenue-the-beauty-of-upselling-and-upgrades/ Streamlined angles on turbulent technologies Sun, 13 May 2012 13:09:17 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: Joel York http://chaotic-flow.com/saas-revenue-the-beauty-of-upselling-and-upgrades/comment-page-1/#comment-15805 Joel York Thu, 13 Oct 2011 23:25:03 +0000 http://chaotic-flow.com/?p=2072#comment-15805 Hi Stephen, The short answer is...in the growth number. The long answer is.... Upsell would not appear at all in the standard growth/churn figures as they count the number of customers, not revenue. In this approach (which is the model used for my SaaS metrics), Upsell it is treated as an increase to the Average ARR per customer over the life of the customer. However, there are analogous growth/churn measures based on recurring revenue, instead of number of customers. i.e., Growth = New Recurring Revenue in Period 2 / Beginning Recurring Revenue in Period 1 Churn = Lost Recurring Revenue in Period 2 / Beginning Recurring Revenue in Period 1 In this case, it would be normal to break the growth number up into two figures: Growth from New Customers and Growth from Current Customers = Upsell Cheers, Joel Hi Stephen,

The short answer is…in the growth number.

The long answer is….

Upsell would not appear at all in the standard growth/churn figures as they count the number of customers, not revenue.
In this approach (which is the model used for my SaaS metrics), Upsell it is treated as an increase to the Average ARR per customer over the life of the customer.

However, there are analogous growth/churn measures based on recurring revenue, instead of number of customers.
i.e.,

Growth = New Recurring Revenue in Period 2 / Beginning Recurring Revenue in Period 1
Churn = Lost Recurring Revenue in Period 2 / Beginning Recurring Revenue in Period 1

In this case, it would be normal to break the growth number up into two figures:
Growth from New Customers and Growth from Current Customers = Upsell

Cheers,

Joel

]]> By: Stephen http://chaotic-flow.com/saas-revenue-the-beauty-of-upselling-and-upgrades/comment-page-1/#comment-15804 Stephen Thu, 13 Oct 2011 17:50:50 +0000 http://chaotic-flow.com/?p=2072#comment-15804 From a reporting side where do you normally see upsells included in metrics calculations? Included in net new customers or an offset to churn? Thanks Stephen McDonald From a reporting side where do you normally see upsells included in metrics calculations?
Included in net new customers or an offset to churn?
Thanks
Stephen McDonald

]]> By: The 3 Things Every SaaS CEO Should Know About Their Service Delivery « The Cirrostratus Group http://chaotic-flow.com/saas-revenue-the-beauty-of-upselling-and-upgrades/comment-page-1/#comment-14144 The 3 Things Every SaaS CEO Should Know About Their Service Delivery « The Cirrostratus Group Thu, 24 Feb 2011 20:42:00 +0000 http://chaotic-flow.com/?p=2072#comment-14144 [...] etc.  Joel York at Chaotic Flow has examined both the impact and details of customer churn and up selling in some of his blog posts and they are a good resource for the details of these [...] [...] etc.  Joel York at Chaotic Flow has examined both the impact and details of customer churn and up selling in some of his blog posts and they are a good resource for the details of these [...]

]]> By: SaaS Product Marketing – Upgrade and Upsell Strategy http://chaotic-flow.com/saas-revenue-the-beauty-of-upselling-and-upgrades/comment-page-1/#comment-13110 SaaS Product Marketing – Upgrade and Upsell Strategy Thu, 16 Sep 2010 19:37:14 +0000 http://chaotic-flow.com/?p=2072#comment-13110 [...] to spend MORE money with you. Upgrades and upsells can lead to orders of magnitude difference in SaaS financial metrics. If you can acquire customers at $100/mo and rapidly upgrade them to $1,000/mo, then you may be [...] [...] to spend MORE money with you. Upgrades and upsells can lead to orders of magnitude difference in SaaS financial metrics. If you can acquire customers at $100/mo and rapidly upgrade them to $1,000/mo, then you may be [...]

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