Selling Your Second Product? Target New Customers First
Many SaaS founders focus on selling their second product to existing customers. While logical, this approach may not yield the highest conversion rates. Surprisingly, selling a second product is often easier with new customers.
Why New Customers Convert Better
The reason is simple: new customers are less likely to already have a competing solution in place. They aren't being asked to switch vendors, making the sale smoother.
Consider this example: MangoMint, a SaaS solution for spas and salons, introduced a payroll feature. While successful with existing customers, the attach rate for new customers was 50% higher. This is because many new SMB clients hadn't yet adopted a modern payroll platform.
This pattern repeats across many SaaS companies. New customers offer a significant opportunity for second product adoption.
Optimizing Your Second Product Launch
While cross-selling to your existing base is important, allocate resources to marketing the combined product offering to new customers. This often overlooked strategy can significantly boost your second product's success.
Don't exhaust all your energy on upselling. Instead, dedicate 20-30% of your efforts to acquiring new customers with the bundled offering. This counterintuitive approach can be a more effective growth lever.
