4 Cross-selling tips for SaaS products

Cross-selling SaaS products, in essence, is quite different from cross-selling traditional software products. This is basically because of the fundamental business model difference: one-time purchase vs. subscription.

When selling traditional software products, the cross-selling mission is to increase the shopping cart value. Cross-selling SaaS products, on the other hand, is all about growing ARPU (average revenue per user), as the initial sign-up covers only a tiny fraction of the CAC (customer acquisition cost), while the rest of it is recovered from the following recurring payments throughout the relationship with the customer. Moreover, it is about establishing a relationship with the customer to grow MRR (monthly recurring revenue). Even a very small addition to a user subscription can play a great role in your annual growth. This is the fundamental principle for SaaS profitability.

Particularly, SaaS products are different, as the companies try to simplify the customer onboarding process as much as possible and try not to confuse or scare the customer away during this process.

A good example of items that can be offered for cross-selling during the onboarding for a SaaS product would be:

• Premium support
• Product Training

For these items, a classical cross-selling strategy can be applied. We described it in our previous post. See:

Cross-selling techniques: 10 ways to optimize your cross-selling strategy

• Add-ons or modules
• Additional products

For the last two, there are a few steps you need to take to make your SaaS cross-selling successful:

1. Package your products wisely

One user is very different from the other, their needs simply vary and you cannot be sure that all of your pricing plans can meet all of the buyer’s expectations or demands. For example, a shopper can go for the cheapest package on your offering, but he might occasionally need a few extra features. The smart solution for this would be breaking down your service into the core (base) plan which includes only essentials of your SaaS and sell all other “perks” and supplementary features that come along with it as an addition to your service or as a more dedicated plan, e.g. “Pro”, “Premium” or “Gold”. These features can be included later in your cross-selling campaigns, which would grow the ARPU (average revenue per user).

Read the full story on PayPro Global’s blog.