How to estimate the revenue potential of your next integration

Learn how to estimate the revenue potential of your next integration.

How to estimate the revenue potential of your next integration
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When it comes to building integrations, one key factor to consider is their potential impact, especially in terms of revenue. At Lunch Pail Labs, we use a straightforward method to estimate the revenue a new integration might bring. Let's dive into this simple yet effective approach.
 
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Understanding the Metrics

1. Total Customers:

This refers to the total number of customers on the platform you're integrating with. For instance, it's 3.5 million for Webflow and 3 million for Bubble. Essentially, this number represents the total addressable market for your integration.

2. Estimated Conversion Rate (%Conversion):

This metric is an estimate of the percentage of users who will adopt your integration. Tools like Crossbeam can help determine user overlap, or you can analyze similar integrations to gauge potential user interest.

3. Percentage of Paying Users (%Paid):

Out of the users who adopt your integration, some will be paying customers. Multiplying the total customers by the estimated conversion rate and the percentage of paying users gives you the count of paid users.

4. Average Monthly Recurring Revenue (MRR):

Finally, by considering how much you expect to earn monthly from each user, you can calculate the average MRR.

Calculating Your Integration's Revenue Potential

Simply put, your integration's revenue opportunity is the product of these metrics. It's a practical way to assess the financial impact of new integrations on your platform.
 
For personalized guidance in navigating the integration landscape, Lunch Pail Labs is here to help. We're happy to discuss integrations and how to maximize your roadmap's impact. Feel free to book an introductory call with us for more insights.
 

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Written by

Lola
Lola

Lola is the founder of Lunch Pail Labs. She enjoys discussing product, SaaS integrations, and running a business. Feel free to connect with her on Twitter or LinkedIn.