Upgrades is a Stripe metric that measures the increase in revenue generated by customers who have upgraded to a higher pricing plan or subscription level.
With Databox you can track all your metrics from various data sources in one place.
Upgrades refer to the process of customers moving from one subscription tier to a higher or more advanced one, where they will gain access to additional features and functionality. Upgrades are an essential metric for SaaS companies as they indicate the growth of customer accounts. They signify that customers see value in the product and are willing to invest more to gain greater benefits.
Tracking this metric is crucial for measuring expansion revenue, understanding customer behavior, and identifying opportunities for upselling.
To calculate upgrades, we need to divide the number of customers who upgraded their subscriptions by the total number of customers. This way, we can get the exact percentage.
Here’s the formula you can follow:
Upgrades = Number of customers who upgraded / Total number of customers
Let’s say you have a SaaS company with 500 customers. During a specific period, 50 customers upgraded their subscription plans. Upgrades = 50 / 500 This leaves us with a 10% upgrade ratio.
A good upgrade ratio can vary depending on several factors, such as your target market, pricing model, and the specific stage of your SaaS business. However, as a general guideline, a healthy upgrade ratio typically falls within the 10% to 30% range.
It’s important to note that a high upgrade ratio doesn’t necessarily mean it’s always better. Sometimes, a high ratio could indicate that you’re not initially capturing enough value in your lower-tier plans. The best thing you can do is continuously monitor your historical data, track industry benchmarks, and evaluate your performance in relation to your specific business context to get a real sense of whether your numbers are good.
To increase the number of upgrades for your product, you need to come up with effective strategies that will encourage your customers to move to higher-tier plans. This can include offering additional value, highlighting the benefits of advanced features, and providing a seamless upgrade experience.
But if you’re looking for something more specific, here are some of the strategies that leading industry experts use in their businesses:
More resources to help you improve:
Used to show a simple Metric or to draw attention to one key number.
Used to illustrate numerical proportions through the size of the slices.
Used to show comparisons between values.
Databox is a business analytics software that allows you to track and visualize your most important metrics from any data source in one centralized platform.
To track Upgrades using Databox, follow these steps:
Usage Upgrades or downgrades are tracked when they actually happen. For example, if a user moved from PlanA ($59) to PlanB ($119) today, an upgrade of $60 will be tracked. The same logic will apply to downgrades.
In cases where the user would switch back and forth, every upgrade and downgrade would be tracked and would influence the upgrade or downgrade amount in Databox. Therefore, Databox suggests using the Calculated Metrics to track the Net New Upgrade or Downgrade values.
Below is an example of the MRR Upgrades metric and the same logic will apply for other Upgrades and Downgrades metrics.
Net New MRR Upgrades = MRR Upgrades – MRR Downgrades
Limitation To calculate upgrades, downgrades, and reactivations we use the /events endpoint. In accordance with the Stripe API documentation, Databox can collect only 30 days of historical data through this API endpoint. For example, if an upgrade occurred 31 days ago, it would not be pushed to and visible in Databox today.
New Customers by Plan Name metric tracks the number of customers who have recently subscribed to a specific plan offered by a business through Stripe's payment platform.
Available Balance metric in Stripe represents the funds that are currently available for immediate withdrawal or payout to connected accounts.
ARR (excl. Canceled Subscriptions) stands for Annual Recurring Revenue excluding Canceled Subscriptions, a metric that calculates the total amount of revenue a SaaS company generates from its recurring subscription fees in a given year. It's a key metric to measure the growth and predict the future revenue of a SaaS business.
ARR (excl. Canceled Subscriptions) by Plan Name is a metric that calculates the total Annual Recurring Revenue generated by each subscription plan excluding canceled subscriptions, providing insights into which plans are driving the most revenue for a business.
New Monthly Recurring Revenue generated by each plan offered by a business during a specific time period.
Churned MRR (Delinquent) is a metric that represents the revenue lost due to payment failures by customers who are considered delinquent and have not updated their billing information.
ARR by Plan Name is a metric that calculates the total Annual Recurring Revenue generated by each subscription plan in a given period, providing insights into which plans are driving the most revenue for a business.
Net MRR stands for Net Monthly Recurring Revenue and is a measure of the change in the MRR over a specific time period.