SaaS and B2B Market Lead
Junaid leads our SaaS practice and helps startups grow their enterprise value.Read full profile
We all know that landing any new customer is something to celebrate, particularly because you can then “land and expand,” using sales and marketing resources to grow revenue from that same customer. But how much precious salesforce time should go to cross- and up-selling existing customers, versus new logo acquisition? We answered that question using SaaS Radar, Fuel By McKinsey’s proprietary database of nearly 200 SaaS companies. Our analysis suggests that companies need to take a Goldilocks approach—not too little, but not too much. Companies that devote about 10-25% of their sales resources to farming instead of hunting do best. If you devote more than that, the upside is less than it would be from devoting those resources to new customer acquisition, and the opposite is true if you invest less than 10%.
Source: Fuel By McKinsey SaaSRadar.