How Account Expansion Invigorates Flow of Recurring Revenue

Today, SaaS businesses are not using a single business model nor do they follow some hard and fast rules when it comes to business growth and revenue generation. They keep improvising their business models and strategies to beat the competition and maintain the flow of revenue stream. Even focus is shifted towards diversifying the revenue streams.

So, here is the team SubscriptionFlow to enlighten you about the account expansion strategies and the role that they play in increasing the revenue.

The Facts You Need to Know about Account Expansion

According to the experts, the probability of selling to the existing customers is 60 to 70 per cent. On the flip side, the probability to convince new customers to finalise a purchase is only 10 to 20 per cent.

Understandably, miscellaneous businesses are shifting to the subscription business model by finding the recurring needs of customers.

Also, it is easier and more feasible to sell your product and services to existing customers. Now, the recurring billing business model and automated platforms are there to bring the same customer base to SaaS businesses. BUT WHAT’S NEXT?

Here comes the concept of account expansion. Account expansion means selling products and services to the same customers rather than acquiring new customers.

Also Read: The Art of Improving Customer Loyalty with Upselling—Tips and Tricks to Boost Your Recurring Revenue Streaming

Account Expansion Strategies

Following are the strategies when it comes to account expansion for SaaS businesses that can help you boost revenue growth.

• Cross-sell
• Upsell
• Add-ons & bundles

Cross-Sell

In the SaaS business market, the needs of businesses change. They need to integrate miscellaneous third-party applications and software with their core CRM. So, cross-selling is one of the account expansion strategies that enable SaaS companies to cater to the changing needs of their existing customer base.

Cross-sell means you sell standalone SaaS products to your customers considering their needs and requirements. For this, you need to monitor the customer journey so that customer requirements can be identified and fulfilled to increase revenue.

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For instance, if a customer is getting subscriptions for personal care products, he or she can be offered summer care items (sunscreen, glasses, mists, and summer cosmetics) as well. You can even offer these items inside a box (subscription boxes). It will increase your sales and revenue generation.

Upselling

Upselling is another account expansion strategy, and it is often confused with cross-selling. It is quite convenient for SaaS companies to opt for upselling account expansion strategy. When you upsell, rather than offering standalone applications or products, you offer your customers more features. In SaaS businesses, it is common to offer integrations to enhance the functionality of the core software. That’s how the features add to the existing SaaS product that you sell.

In the SaaS business world, companies usually go for upselling in the form that they divide the prices into different pricing plans depending on the features that they offer in these pricing plans.

Add Ons

Add-ons should not be confused with cross-selling. Add-ons are not like standalone applications, they cannot be used without the core SaaS product that is provided to the client. SaaS add-ons are very common for gaming software and applications.

And these add-ons bring in a wave of revenue to the existing revenue stream.

How to Formulate a Workable Account Expansion Strategy

If you want to formulate upsell and cross-sell strategies rightly, then you need to plan them wisely. It has to be ensured that you sell rightly to the right customers.

Here are some of the tips that can help you to craft an account expansion strategy:

Track Customer Journey

From onboarding to the cancellation of the subscriptions, the customer leaves traces throughout this journey that can be tracked with advanced tools and technology. This track of the customer journey tells what type of add-ons or upsell features customers need and what is the right time to offer them.

Sometimes, cross-sell and upsell strategies are formulated to bring back the customers that are about to cancel the subscriptions. However, it totally depends on your business and its needs that how and when you plan account expansion.

Also Read: Subscription Retention Begins With Customer Experience Elevation—Predictions and Actions for 2021

Work on Product Value

It is the age of digitalism, and the customer is equipped with tools that can help him get the product and services. Not only that but customers are intelligent enough to calculate the value of the product against the price that they are paying for it. Hybrid pricing models in the subscription businesses are appreciated in the subscription business market for they are introduced to cater to such customers who want to pay for exactly what they use.

So, for the success of your SaaS business and account expansion strategy, you need to work on the product value. Cross-selling and upselling cannot help you if your product is not satisfying the customers. So, work on the product value before you devise an account expansion strategy.

Market Upsell & Cross-sell Strategies

When you are working on the cross-selling and upselling activities, you also need to onboard your marketing teams. They are the ones who will market your advanced features and add-ons to those who actually need them. You can make the cross-sell and upsell items part of your email marketing.

Or do customer segmentation so as to market and sell your product and services to the right niche of customers. In short, you need to work on your outreach as well while you are devising account expansion strategies.

Be Contextual

As it has been mentioned that upsell means you offer advanced features for your SaaS product or services, so, you should start sending notifications and messages regarding updates at the right time.

Right time does not mean that you have developed a feature or an upgrades version, and you start bombarding messages to your customers. You should start sending notifications regarding the upcoming update when your upgraded version or features are in the phase of completion. Thereafter, you will increase notifications a bit when you have finalized and launched these new features.

The point is to know the right time to do the right thing!

Also Read: What is Customer Success and why do You Need it for Your Subscription Business Model to Succeed?

Conclusion

If you are planning account expansion for SaaS business, then do it with SubscriptionFlow. Our platform is highly responsive, and the team is motivated to help you manage subscribers through an automated subscription management platform. Account expansion has become the core of the subscription businesses. And customer retention and revenue retention are the most important metrics in this regard.

However, when you have onboarded SubscriptionFlow, you can manage subscribers, increase revenue, and monitor all metrics that are important for your account expansion strategy. Schedule a demo to know how SubscriptionFlow can benefit your subscription business.