How to Identify Upsell Opportunities and Drive Account Expansion for SaaS

How to Identify Upsell Opportunities and Drive Account Expansion for SaaS cover

Do you know that upsell opportunities exist throughout the customer journey and all you have to do is identify and take advantage of them?

Yes, they do! This article shows you how to drive SaaS growth with upsells. You’ll learn:

  • Why upselling benefits both you and the customer.
  • How to find and maximize upsell and cross-sell opportunities.
  • And best practices for increasing your conversion rate.


  • Upsell opportunities are key moments along the user journey where customers are introduced to higher versions of products or services they intend to buy (or already have).
  • Upselling tries to sell a higher version of the same product, while cross-selling asks users to buy complementary products.
  • The benefits of upselling: more revenue, increased customer lifetime value, loyalty and retention, and is less expensive compared to acquisition.
  • Upselling in SaaS is measured using the expansion MRR metric (the extra monthly revenue from existing accounts).
  • The best way of identifying upsell opportunities is by segmenting customers based on product usage.
  • Segment users based on customer journey stage and offer logical upsell opportunities. Customers who haven’t even reached the activation stage won’t upgrade, while customers who have been with you for a while and experience value, are more likely to upgrade.
  • Segment users based on jobs to be done and offer relevant premium features to each user persona. Don’t forget to personalize the microcopy as well.
  • The next segment is trial users. Message trial users before their subscription ends and let them know what they stand to miss if they don’t upgrade.
  • NPS surveys are great for segmenting your loyal customers. Send out in-app surveys and then segment users based on their NPS scores. Your loyal customers (those who gave you a score of more than 8) are the most likely to upgrade.
  • Best practices for your cross-sell and upsell process: offer limited deals, tailor pricing based on customer needs, remove upgrade friction to make it easy for users to upgrade, and use FOMO to show what customers are missing out on.

What are upsell opportunities?

Upsell opportunities are sales strategies used by companies to promote higher versions of their products than what prospective customers originally intended to buy. In addition to boosting revenue, upselling also gives the customer a chance to use a product or service that has more capabilities and features.

What’s the difference between cross-selling and upselling

Upselling and cross-selling are both account expansion strategies, but they have key differences.

Upselling happens when your sales team tries to convince existing customers to buy an upgraded or enhanced version of the original product. This could be moving from the free to a paid version or getting additional features on the paid plan. A good example is Dropbox reminding users to upgrade their accounts and get more space.

On the other hand, cross-selling involves selling a complementary product or service in different categories. For instance, Toggl offers three products that can all be used independently: Toggl track for time tracking, Toggl plan for project planning, and Toggl hire to help companies hire more effectively.

Cross-selling is when the company observes a customer using Toggl hire and convinces them that getting the time tracker will improve employee efficiency.

Why is upselling important?

Upselling benefits both the company and its customers.

For the customer, you’re showing them features they probably didn’t know they needed. And usually, there’s an added incentive to buy (e.g., discounts), so customers will gladly seize the opportunity and get a better tool for their job.

For the company, it means an increase in monthly recurring revenue (MRR). Customer loyalty and retention are also enhanced—customers are now getting added value, have invested more, and will naturally want to stick for a longer time.

Another advantage of upselling is that it’s cheaper to get an existing customer to spend more money on you than new customer acquisition.

How do you measure upselling in SaaS companies?

Upsell rates can be measured based on your expansion MRR—the extra monthly revenue from existing customers.

The expansion MRR rate is calculated by subtracting your expansion MRR at the beginning of the month from what you have at the end of the month. Divide the result by the expansion MRR at the beginning of the month and multiply it by 100 to get the percentage.

Pictorial explanation:


Expansion MRR doesn’t just measure upsells; it also helps you keep track of revenue generated from other expansion strategies (cross-sells, bundling, and add-ons).

How to identify upsell opportunities with product usage segmentation

Users are most ripe for upsells when they reach key milestones in their journey. Usage limits, X period on the app, etc. Your conversion rates will skyrocket if you push for contextual upsells at these moments. But how do you know when users have reached such milestones?

Enter: segmentation.

There are, however, different ways to segment and reach out to SaaS users. Let’s go over the major approaches.

Segment users based on customer journey stage and detect logical upsell opportunities

Some companies randomly try to upsell. That’s an outdated method that depends on your guesses and doesn’t yield results. Good customer success managers know that upgrades always need to be c0ntextual and timely.

The first step to identifying relevant upsell opportunities is mapping your user journey. With a journey map, you’ll know when a customer had reached the point in their journey when an upsell would bring them more value.


Software like Userpilot enables you to build segments and track when specific events happen to indicate the user has reached a particular milestone.

Advanced user segmentation in Userpilot.

Would you upgrade to the pro feature if you just signed up and haven’t had time to test the app?

Not likely.

But the situation will be different if you’ve been using the app, are familiar with its core features, and want to get even more value from the app.


Segment users based on jobs to be done and offer relevant upsells to each user persona

Empathy will give you an edge over other companies. It’ll make you the SaaS company that understands its users and shows them the best way to get their job done.

But it’s impossible to do this manually when you have more than a handful of customers. By using a welcome flow to collect user data, you’ll know who they are, what their jobs to be done are, and how best to help them.


Use a form similar to the one above to collect user data and group them accordingly.

Next, determine which of your premium and advanced features each user segment will find valuable, then personalize the upgrade message.

Here’s an example:


Track product engagement and identify customers who’ve reached their feature usage limits

Some SaaS products allow access to all features but set usage limits that require an upgrade to keep enjoying the tool.

If you use this model, you don’t have to wait for users to reach their limits and contact you themselves. Instead, use specialized software to track in-app engagement. Such marketing tools allow you to set limits and create an automated flow where users are prompted to upgrade the moment they reach their account limits.

Tag features and track user engagement with your product in Userpilot.

See how Loom contextually upsells when the user reaches the free recording limit:


Segment free trial users and prompt them to upgrade before the trial ends

The ultimate goal of free trials is to make users experience the product’s inherent value, be convinced that they really need the premium version, and upgrade after the trial ends.

But we all know converting trial users is easier said than done. Your best bet is to develop an in-app communication strategy that builds customer relationships and reminds them of the need to upgrade. You can use different UI patterns for this. Static banners also come in handy.

Notice how the static banner below triggers FOMO by reminding users of the trial end date and what they stand to miss if they don’t upgrade.


You can also reach users directly via email if they don’t upgrade after a few days.


If they haven’t upgraded and have been automatically downgraded, you still have one more upsell opportunity. Remind them their account has been downgraded and they lost access to a handful of features. A perfect example from Loom:


Look for upselling possibilities among your loyal customers

Loyal customers love and trust your brand. They do repeat business with you, regularly use the app, and even tell others about you. These customer segments make for good upselling opportunities as they’re more inclined to pay for additional features.

How do you identify them? NPS is a sure way.

Send a short survey like this to all customers:

Userpilot NPS survey

Then segment them based on NPS scores. Loyal customers are those who gave you a score above 8. Identify them and offer contextual cross-sells and upsells.

NPS score segmentation
User segmentation based on NPS in Userpilot.

Cross-selling and upselling best practices for SaaS

SaaS upselling often gets tricky. Without the right strategy, you risk mis-selling and will struggle to convert users. Let’s go over some ideas for making the most of upsell opportunities:

Drive customer expansion by showing users what they’re missing out on

FOMO is an age-long marketing tactic that always works, provided the user is interested in what you’re selling.

Use this to your advantage. Show users what they stand to miss if they fail to upgrade.

Miro is a good example of using FOMO to drive account expansion. The productivity app allows teams to create three boards for free. But it reminds users that the boards are public to all team members, hinting that customers should upgrade if they want privacy and more boards.


Remove upgrade friction and make it easy for users to upgrade

According to the Fogg Behavior Model, a person has to have three things in order to act:

  • Motivation
  • Ability
  • Prompt

It is essential that all three elements converge at the same time.

This means you could be missing out on upgrades if users have moments where they want to take the leap but are met with too much friction. Intercom has managed to get around this friction by making the upgrade button readily available when the user is most likely to need it.

When their users want to add an element not included in their plan a tooltip will pop up, letting you know it’s a premium feature. The short text also briefly explains the value of the feature and ends with a CTA that prompts you to upgrade.


Offer limited deals and discounts when upselling to motivate users

We all buy emotionally and use logic to justify the purchase. By providing a limited-time discount, you save users the mental effort of trying to justify their decision. They’ll see your offer as a good deal, a steal they can’t get any other time.

Many will jump at it, especially if it was triggered at the right point in their journey.


Tailor SaaS pricing based on the needs and maximize upsell

Tailoring SaaS pricing based on the needs of users is an extremely powerful strategy when trying to drive customer expansion.

Miro is once again a great example of this, as it has successfully spread out its features across four plans to optimize customer expansion.

The company has four plans and the free plan doesn’t have a member limit for teams. That’s a wise approach as more freemium users means more targets for upgrades. Offers on the three paid plans are distributed in a way that customers don’t have to pay for features they don’t want.


Offer premium feature trials and showcase the value they’ll get

The wisdom of test driving is simple: give prospects a feel for the car and they’ll be more likely to pay for it. You might be having second thoughts about buying your dream car now that you can finally afford it. Then you enter the car shop and the salesperson takes you for a test drive.

Those brief minutes allow you to feel the speed, comfort, and sleek design of the automobile. The experience is totally different from what you read and watched online. Now you can’t wait to have it forever!

Something similar happens when you grant users limited access to premium features. At the end of the trial, customers are more likely to upgrade after experiencing the value of the paid features.

For instance, Asana never hides features. They use them as a hook to get more freemium users to upgrade to premium.


Combine in-app message upgrade prompts with emails

In-app messaging works well for communicating with existing users. But your customers aren’t always in the app, so following up with email is a great way to drive more upsells.

Airtable is creative with this. They have a newsletter that breaks down the product and premium features to new users and offers suggestions to help the user get the most out of their product.

airtable upselling example


A key takeaway from this post is that cross-sell and upsell opportunities exist throughout the customer journey. You just have to use product usage segmentation to spot them and study your customers’ behavior to identify when they’re most ready to convert.

If you’re interested in tracking user behavior in-app and using automation to maximize upsell opportunities, book a demo with Userpilot and let us show you how.

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