Free Upsell Revenue calculator with clear step-by-step results.
An upsell to an existing customer carries almost no acquisition cost, so the uplift flows through at a much higher margin than new business. Multiplying the monthly uplift by how long customers keep the upgraded tier gives lifetime revenue, which is the figure to compare against the effort of running the campaign.
Monthly incremental revenue
Revenue = customers offered x take rate x price uplift
Lifetime revenue
Lifetime = monthly incremental revenue x months retained
Because the customer already exists and the incremental delivery cost of a higher tier is usually small. There is no acquisition cost to recover.
Ten to twenty percent for a well-targeted in-product upgrade prompt, considerably lower for an untargeted email. Relevance matters far more than discounting.