Most software companies that offer one main service have a fundamental problem.
They have one product, which means they cannot cross-sell anything else to their customers.
They can only make more money from each customer by getting existing customers to pay more for that same single service.
One lesson we can learn from ecommerce is that we must always try to boost average order value.
Common tools for that are upselling and cross-selling.
Ecommerce stores can sell you a phone, then a case, then a charger, then headphones.
Each purchase adds to your total order value.
SaaS companies with single products miss this opportunity entirely.
They have three limited ways to increase what each customer pays them.
They can charge for more user accounts when teams get bigger.
They can charge based on how much customers actually use the service.
They can also offer premium features that cost extra each month.
This puts a hard ceiling on growth potential.
Your email marketing tool can only sell email marketing upgrades.
Your project management software can only sell project management features.
Eventually, every customer maxes out what they’re willing to pay for that one service.
You can upsell only so much.
Thats why cross selling is essential.
The way out of this trap is building ecosystems, and we see them everywhere now.
Google started with search, then added Gmail, Google Docs, Google Drive, Google Cloud, and Google Ads.
Microsoft built Office, then Teams, then Azure, then Dynamics.
Amazon began with shopping, then added Prime, AWS, Alexa, and advertising services.
These ecosystems allow endless cross-selling opportunities.
Google can sell you email, then productivity tools, then cloud storage, then advertising services.
Each new product creates another revenue stream from the same customer relationship.
They can keep adding services and keep increasing how much each customer pays them.
Ecosystems also make switching nearly impossible.
When you use Gmail, Google Docs, Google Drive, and Google Ads all together, leaving Google means rebuilding your entire workflow.
The switching cost becomes enormous.
You’re locked into their ecosystem whether you like it or not.
Single-product SaaS companies are catching on and trying to expand.
Slack added video calls and file sharing.
Zoom added phone systems and webinars.
Shopify added payments and shipping tools.
They’re all racing to build ecosystems because they know single products have limited growth potential.