It’s no secret that it’s a heck of a lot cheaper to upsell to an existing customer than it is to acquire a new one. In fact, it’s 3X cheaper to generate expansion revenue—revenue from upsells, add-ons, and cross-sells—than it is to acquire new customers.
So what’s the secret to increasing expansion revenue? Contextual, timely, self-service upgrade prompts.
Whether you’re looking to convert users from a free trial to a paid plan or you want to upgrade loyal customers to a higher tier, a well-positioned, well-designed upgrade or upsell prompt is the key to making that happen. The trick is making it as tempting and easy as possible for customers to upgrade—without bombarding them with constant messages to pay up or else.
Below, we’ll go through some examples of companies that excel at upselling.
1.Spotify: Position upsells as moments of discovery
Unless your customers are actively thinking about upgrading (and how often does that happen?), they’re unlikely to visit your pricing page to learn about higher tier features. Rather than expecting them to hunt down this information themselves, make your customers aware of premium features by positioning reminders within in the user interface itself.
Take Spotify, for example. Free Spotify users are allowed to skip 6 songs per hour—after that, they’re prompted to upgrade to a premium account. The premium feature is integrated into the user experience, which allows user can see it in context and understand how it would benefit them.
What’s more, Spotify cleverly positions this upsell prompt as a moment of discovery. “You discovered a Premium feature” feels a lot more positive than “you’re not allowed to do that until you pay us.”
2. Airtable: Tempt users to start bigger projects with an upgrade email
In-app messaging is one of the best, most contextual ways to communicate with your users—but by their nature, in-app messaging is only effective when users are, well, in your app. Take advantage of the touch points you have with your users beyond your product.
Pairing your in-product upgrade prompts with an enticing engagement email is a great way to reach users when they’re outside your product. Use your newsletter to give users the chance to window-shop features without flooding their inbox with an extra email send.
Airtable newsletters do an incredibly thorough job of this. Much more than a simple cash grab, this upsell email breaks down some of Airtable’s premium features and provides tips to help you get the most out of them.
3. Squarespace: Prompt upgrades via integrations
Integrations expand the life of your product. While a user may not be interested in leveling up in your app right now, they may be very interested in using your product alongside another in their tech stack. And the more a user invests in your product and makes it part of their daily lives, the more likely they are to continue using it long-term—and to eventually upgrade. Integrating with other products in their tech stack will not only make your app more helpful and useful to the work they do, it will also make it indispensable.
So use your integrations as upselling opportunities—reserve some for higher tier plans and show other users just what they're missing out on.
Squarespace’s commerce integrations, for example, are only available as premium features in the Commerce Advanced plan. Instead of prompting you directly to upgrade, it takes a softer approach to upselling and invites you to learn more about why you might need one of these plans.
Your integrations can inspire users to create bigger and better things with your product—ration and celebrate those features to turn them into upsell opportunities.
4. Zapier: Trigger upgrade prompts right when users need them
Push an upgrade CTA too forcefully when users have just arrived in your app—or are trying to use their current plan's features—and you risk annoying them rather than engaging them. Instead, you should tie your upgrade prompts to specific user actions to help users realize their own need for your premium features.
For instance, Zapier triggers a modal window when users click on a higher tier feature, and gives them a single button to upgrade. There’s zero ambiguity here, and the directness is effective in this case because the prompt occurs while users are already motivated to complete the task at hand. Piggy-backing on active engagement is a good way to contextualize your upgrade prompt while taking advantage of user-driven momentum.
5. Harvest: Include free and premium features side-by-side
Instead of waiting until users click on a feature to tell them that it’s premium, you can also position premium features alongside alongside commonly-used free features to catch the user’s eye and make them want to find out more.
Time tracking software Harvest disables its premium features—in this case, the “import” feature, which is greyed out—but keeps the CTA prominently positioned between 2 free-to-use buttons. Hovering over the import feature displays a tooltip with an inline upgrade link.
6. Dropbox: Mix it up with multiple upselling messages
You don't have to wait until users have exhausted all the features in their existing plan to prompt them to upgrade.
Dropbox uses persistent upsell prompts to remind users of the restrictions that come with a free plan, and offer them regular opportunities to upgrade. Because these prompt are ever-present (but dismissible), Dropbox smartly mixes up the messaging, which subtly draws attention from users who may have otherwise tuned out the repeated prompt.
And the calls to action aren’t limited to these sideline prompts. A simple “Upgrade account” CTA at the top of the screen acts a subtle but compelling reminder to regular users that they could be getting more out of the product.
7. 15Five: Add prompts to the regular workflow of users
Remind your customers how they can benefit from using a deluxe version of your product. One of the best ways to do this is by adding discrete upsell prompts into their regular workflows. As long as you keep the user experience in mind and don’t take a heavy-handed approach, these types of prompts can be reminders about the value of converting to a higher pricing tier.
15Five uses this tactic masterfully by introducing upsell messages into the regular workflow of managers. While reviewing reports within the 15Five web app, managers are prompted with hotspots that underline the value of upgrading to one of the higher plans:
The product also promotes premium features in the main menu of the app. When managers navigate to the “Objectives” tab, they get a full page of features that encourages them to upgrade their plan:
8. Asana: Tailor upsell prompts to power users
Companies often focus their upselling efforts on users who are on a free or freemium plan, but revenue expansion should also focus on moving paying customers to more premium pricing plans.
To convince power users who already pay for your product to upgrade, you must first identify the features that would provide the most additional benefit to each cohort. It’s important to understand how your users’ needs will change as they move to higher tiers—what sets individuals or small businesses apart from enterprise users, for instance.
Project management tool Asana, for example, gates their Portfolios and Workload feature—the value of which may not be relevant to new users, but which becomes increasingly appealing as you ramp up your use of the platform.
When free or mid-tier users click on the feature, a video that explains how Portfolios and Workload works and an upgrade CTA appear in place of the dashboard.
9. Slack: Link prompts to a relevant value metric
Convincing users to upgrade is easier when your pricing is organized around the most relevant value metric.
Slack is known for using this technique to fuel its spectacular growth. Slack limits organizations on its free plan to 10,000 archived messages. If these companies want access to their full history, they have to upgrade to a paid plan.
Instead of putting up a hard paywall, Slack hints that users could be getting more value from the service.
If you try to trick or cajole users into paying for additions and upgrades to your app, you risk losing them altogether. Instead, let users make the next move. When users take initiative, it means they're interested in the upgrade and engaged with your app. The 9 companies reviewed above take their cues from users before they present an upsell, and it works.
Nudge users toward additional features after they’ve mastered the basics and accessed your product’s core value. Don’t just think an upsell as a way to get more from your customers—think of it as an opportunity to help them get more out of your product and deepen their engagement in the long-term.
Find out how you can use Appcues to quickly create and iterate on upselling prompts in your own product.