Since this year, we have separated Churn & Upsell rates in the financial dashboards of our ventures between new and existing customers.
The boundary between a new and existing customer is set at 12 months for us.
The reason why we break these rates down is because differences between the two can be a signal for issues that need to be addressed.
Here are a few examples:
– When your upsell percentage for new customers is much higher than for existing ones, it may indicate that the initial subscription for new customers is simply too low. This could suggest that the sales process may not be optimally configured.
– A significantly higher churn among new customers indicates that you may have shifted focus to a new target audience, and this may not have been a wise decision.
– When the churn among existing customers is much higher than among new customers, it may call for a more intensive approach to customer success.
It might sound straightforward, but we often see these rates lumped together. Whereas breaking them down provides you with quick insights into things you might need to address.
So, in your financial dashboards, make a breakdown between upsell/churn for new and existing customers.
An important note, of course, is that the relevance of this breakdown depends on the business model.