Commission on New Business vs Existing Customers: Upsell, Cross-sell and Renewals

Should you pay the same commission on new business and existing customers?

Usually not. Most companies pay the highest rate on new customers (new logos), a lower rate on expansion revenue from existing customers (upsell and cross-sell), and the lowest rate, or a retention bonus instead of commission, on renewals. The reason is effort and attribution: a new logo is won against no existing relationship, while expansion and renewals build on work the whole company has already done.

This guide explains why the rates differ, the four rate structures companies use, worked examples in USD and EUR for different roles and company sizes, how to stop reps booking a new deal as an upsell (or the other way round), and how to split revenue ownership between account executives, account managers and customer success managers. It also includes new data from public job ads on how each role's job description talks about new business, expansion and renewals.

Key findings

• 44.4% of account executive and business developer job ads in Prowi's dataset talk about new business or new customers, against 30.9% of account manager ads (2 November 2026, 1,428 ads).
• 47.4% of account manager ads mention upsell, cross-sell, expansion or existing customers, the highest share of any sales role.
• 63.5% of customer success manager ads mention renewals, retention or churn, so renewals are framed as a CSM job far more often than a sales job.
• 2.4x: account executive ads mention commission 2.4 times as often as account manager ads (33.1% against 13.7% of classified ads).
• $2,000 per deal is what a mislabelled upsell costs in our example, before you count the dispute when two people claim the same deal.

Why do companies pay differently for new logos, expansion and renewals?

Because the rep's share of the result differs. A new logo depends almost entirely on the seller. Expansion depends partly on the seller and partly on the product, support and the relationship already in place. A renewal often happens because the customer is happy, and the seller's role is to protect it, not create it.

Three forces push companies towards different rates:

• Effort and risk. Winning a customer that has never bought from you takes prospecting, discovery, a longer sales cycle and a higher chance of losing. Expansion deals close faster and win more often, because the customer already trusts you.
• Attribution. Paying the full new-business rate on a renewal pays the rep for revenue that would have arrived anyway. Paying nothing on expansion means nobody is accountable for growing the base.
• Company strategy. A company that needs market share pays more for new logos. A company whose growth comes from its installed base, measured by net revenue retention (NRR), pays more for expansion and ties renewals to gross revenue retention (GRR).

Paying one rate on everything is not wrong. It is simple, and it works when the same person owns the customer from first deal to renewal. It breaks when different people own different parts of the customer lifecycle, or when existing customers make up most of the revenue.

What counts as new business, upsell, cross-sell and renewal?

New business is revenue from a customer that has not bought before (or not for a defined period). Upsell is more of what an existing customer already buys, cross-sell is a different product to an existing customer, and a renewal is the same contract continued. Write these definitions into the plan, because most disputes start with a deal that could fit two of them.

For more on each term, see the glossary entries on upsell and cross-sell commission, renewal commission, net new revenue and winback.

What rate structures do companies use?

There are four common structures: one rate on all bookings, separate rates by revenue type, new-business commission plus a retention bonus, and commission on renewal uplift only. The right one depends on who owns the customer after the first deal.

The rates in these examples are illustrations, not benchmarks. Use them to compare structures, and set your own rates from your margins, sales cycle and on-target earnings. Our post on commission plans by role shows complete plans for ten roles.

Worked example 1: an account executive in a US software company (USD)

An account executive earns 10% of first-year ACV on new logos, 5% on expansion deals they close in their own accounts during the first 90 days, and nothing on renewals. In one quarter, the commission is $14,000 on $360,000 of bookings.

On a single 10% rate on all bookings, the same quarter would pay $36,000, most of it for renewals the rep did not work on. On a single rate on new and expansion only, it would pay $16,000. The split structure pays the rep for what they created and leaves the renewal to the account manager.

What happens when a new logo churns early?

Many plans claw back commission if a new customer leaves within the first months. Example: the $120,000 customer pays for 4 months and then cancels. If the plan treats commission as earned evenly over the first 12 months, the unearned share is 8/12 of $12,000, so $8,000 is recovered from the next statement. If the plan has no clawback, the company paid full new-logo commission for four months of revenue. Write the rule down either way; our guide to commission clawbacks covers the options.

Worked example 2: an account manager in a European company (EUR)

An account manager owns a book of existing customers worth €1,000,000 in annual recurring revenue on 1 January. Instead of commission per deal, they earn a target bonus of €20,000, multiplied by where the year's NRR lands. If NRR ends at 107%, the bonus is €30,000.

Example: the portfolio ends the year at 107% NRR. During the year the account manager added €150,000 in expansion, the book lost €30,000 to downgrades and €50,000 to churn. NRR is (1,000,000 + 150,000 - 30,000 - 50,000) / 1,000,000 = 107%. GRR, which ignores expansion, is (1,000,000 - 30,000 - 50,000) / 1,000,000 = 92%. The multiplier is 1.5x, so the bonus is €30,000.

A plan that only measures NRR can hide churn behind big upsells. Many companies therefore add a GRR floor, for example no bonus above 1.0x unless GRR is at least 90%. In this example GRR is 92%, so the full 1.5x applies. An alternative is a per-deal expansion commission, for example 6% of the €150,000, or €9,000, with a GRR gate on the year. Our account manager commission plan works through both versions, and the retention-based commission model shows the mechanics.

Worked example 3: a small company with full-cycle reps (EUR)

In a 12-person software company with two salespeople, each rep finds, closes and grows their own customers. A single rate on new business and expansion, with no commission on renewals, keeps the plan readable and avoids disputes about deal type.

Example: a rep books €60,000 in new contracts and €15,000 in expansion in a quarter. At 8% on both, the commission is €6,000. Renewals are left out because the contracts auto-renew and the rep did not have to win them again. When the company later hires an account manager, the plan splits: the rep keeps new logos and the account manager takes expansion and renewals.

How does the split change with company size?

Small teams use one rate and one owner. As the company grows, ownership splits into hunters and farmers, and finally into separate teams for new business, expansion and renewals, each with its own plan and measure.

Who owns which revenue: AE, AM or CSM?

The account executive owns new logos, the account manager owns expansion, and the customer success manager owns retention. The hard part is the boundary: how long the AE keeps an account after the first deal, and whether the CSM is paid on renewals or only on keeping customers healthy.

Write the handover as a crediting rule: the trigger (a date, the first invoice paid, or the kickoff meeting), who gets credit for deals in progress at handover, and what happens if the account manager leaves. Example: an AE closes a new logo on 1 March, and the customer adds $30,000 in seats on 15 April. Inside the 90-day window, the AE earns 5% expansion commission, or $1,500. If the same order came on 15 June, it would belong to the account manager. See the role plans for account executives, customer success and renewals for complete examples.

How do job ads describe each role? New data

Job ads mirror the split. Account executive ads mostly talk about new business, account manager ads about expansion and existing customers, and customer success ads about renewals and retention. Account executive ads also mention commission far more often.

We classified open sales job ads in Prowi's jobstore, a dataset of public job ads from company career pages, by job title and searched the ad text for wording about new business, expansion and renewals. Data read on 2 November 2026, recruitment agencies excluded. Commission is measured by a field that was reviewed by hand and is only filled for selling roles, so it is not shown for customer success.

What the data says and does not say

• Keyword matches are approximate. "Expansion" sometimes refers to the company's own growth, and "new customers" can appear in an account manager ad that also covers hunting.
• Commission shares are of the ads that were classified (659 AE and 393 AM ads). Many companies pay commission without writing it in the ad.
• The pattern is still clear: companies describe AEs as hunters with variable pay, account managers as growers with less variable pay, and customer success as the owner of retention. Plans that pay the same rate on all three ignore how the companies themselves describe the jobs.

How do you stop reps sandbagging new deals as upsells (or the reverse)?

Define each revenue type by data the rep does not control, such as invoice history and group structure, and make the deal type a required field that someone other than the rep can check. Then make the rates close enough that mislabelling is not worth the argument.

Mislabelling goes both ways. An AE who earns 10% on new logos and 5% on expansion wants a new subsidiary of an existing customer to count as a new logo. An account manager who earns more on expansion than on renewals wants a renewal with a small add-on to count as expansion. And any rep near a quarter-end threshold may hold a deal to the next period, which is classic sandbagging.

Example: a $50,000 deal with a subsidiary of an existing customer. Booked as a new logo, the AE earns 10%, or $5,000. Booked as expansion, the account manager earns 6%, or $3,000. Mislabelling costs the company $2,000. If both claim it and both are paid while the dispute runs, the company pays $8,000 for one deal.

Three habits keep this manageable. First, a required deal-type field in the CRM, validated against invoice history before the deal is paid. Second, a named person (sales ops, finance or the sales manager) who decides unclear cases within a set number of days. Third, a statement that shows each deal's type and rate, so reps can see and challenge the label before the period closes.

Should you pay commission on renewals at all?

Pay commission on renewals when renewing takes real selling work, such as a negotiated multi-year renewal against competing offers. Do not pay it, or pay a small rate, when contracts renew automatically. In most subscription businesses, renewals are better measured with GRR or churn than paid per deal.

Example: a customer renews a $200,000 contract at $220,000. The $20,000 increase includes $8,000 of contractual price indexation and $12,000 for added seats. Here is what four common renewal rules pay:

Multi-year renewals add one more question: is commission paid on year one, on the annual value or on the total contract value? Most plans pay on annual value and add a small multiplier for longer terms. See the multi-year deal commission plan and the contract-term multiplier for worked numbers.

Which edge cases should the plan cover?

Price increases, downgrades followed by upgrades, co-termed contracts, mergers between customers and partner-sourced expansion cause most of the disputes in mixed plans. Each needs one sentence in the plan.

What are the most common mistakes in new vs existing customer commission?

The most common mistakes are paying full commission on renewals nobody worked, leaving deal type to the rep's judgement, and measuring account managers on NRR without a churn check. All of them are fixable in the plan text before the year starts.

1. No written definition of "new". Without a look-back period and a group rule, every subsidiary becomes a new-logo argument.
2. Rates too far apart. A 12% new-logo rate next to a 2% expansion rate invites mislabelling. An expansion rate of about half the new-logo rate, as in our examples, keeps the gap meaningful without making the label worth a fight.
3. Paying for price increases. Indexation and list-price changes inflate expansion and NRR without any sales work.
4. NRR without a GRR floor. One large upsell can hide several churned customers.
5. Handover by owner change. Changing the deal owner in the CRM at handover moves past commission with it. Hand over the account, not closed deals.
6. No rule for deals in progress at handover. Decide in advance who gets credit for pipeline that is open on the handover date.
7. Changing the split mid-year without notice. Moving accounts from AEs to AMs changes pay. Treat it as a plan change, with notice and written terms.

How do you design a plan that pays differently by revenue type? Step by step

Start with who owns each stage of the customer lifecycle, then define each revenue type by data, set rates that reflect effort without inviting gaming, and test the plan on last year's deals before you launch it.

1. Map ownership: List every role that touches revenue and write down who owns new logos, expansion, renewals and churn, including the handover trigger.
2. Define revenue types by data: Use invoice history, group structure and contract dates, not the rep's judgement. Agree on look-back periods for new logos and winbacks.
3. Choose a structure per role: Commission per deal for AEs, commission or NRR bonus for AMs, GRR or churn bonus for CSMs.
4. Set the rates: Work back from on-target earnings and the expected mix of revenue. Keep the gap between new and expansion rates small enough to avoid relabelling.
5. Add guardrails: Clawbacks for early churn, a GRR floor on NRR bonuses, no commission on indexation, and one named person who rules on unclear deals.
6. Back-test: Run last year's deals through the new plan and check what each person would have earned, and what it would have cost.
7. Make it visible: Show each deal's type, rate and owner on the rep's statement during the period, so mistakes are caught before payout.

Before launch, run the plan through the commission plan health check to see where it is unclear.

What do the rules say in the US, UK and EU?

No law tells you which rate to pay on new or existing customers, but moving accounts between people and changing rates is a change to pay. In many places the commission method must be in writing, and commission counts as wages. This is general information, not legal advice; check with local employment counsel.

• United States. Rules differ by state. California Labor Code section 2751 requires commission contracts to be in writing and to set out how commissions are computed and paid, so revenue-type definitions and handover rules belong in the written plan.
• United Kingdom. Commission is part of wages under section 27 of the Employment Rights Act 1996. Clawing back commission when a customer churns needs a clear contractual basis.
• EU and the Nordics. Directive (EU) 2019/1152 requires written information on remuneration and its components. For self-employed commercial agents, Council Directive 86/653/EEC gives the agent a right to commission on repeat transactions with customers they acquired, so a rule that stops paying on existing customers may not hold for agents.

How does Prowi handle new business, expansion and renewals?

Prowi calculates commission from your CRM data, so the rule for each revenue type can use the fields you already have, such as deal type, pipeline or a custom field. Each rep sees a live statement with each deal's type and rate, and early-churn clawbacks land as corrections on the next statement.

When a period starts, Prowi creates a statement for each rep that updates live as deals close. AEs, AMs and SDRs can each have their own plan, and corrections for churned or reduced deals are calculated and shown line by line. When the period closes, the statement goes to approval, and approved commission is added to the rep's balance and passed on to payroll, straight into Zenegy or as a payroll file. Book a demo to see how a split plan looks on your own data.

FAQ

Should account managers get commission on upsells?

Usually yes, either as commission on the increase in annual recurring revenue or as a bonus on net revenue retention. Add a churn or GRR check so upsells cannot hide lost customers, and keep the expansion rate close enough to the new-logo rate that deal labels are not worth fighting over.

Do sales reps get commission on renewals?

Often not, or at a low rate. If contracts renew automatically, paying commission rewards revenue that would have arrived anyway. Pay on renewals when they are negotiated and at real risk, or pay only on the increase at renewal.

What is a typical commission split between new and existing business?

There is no single standard. One pattern, used in the examples in this guide, is a higher rate on new logos, about half that rate on expansion and little or nothing on renewals. Set your own rates from on-target earnings, margins and the expected mix of revenue, and back-test them on last year's deals.

How do you define a new customer for commission?

Use data the rep does not control: for example, no paid invoice from the company or any company in its group in the last 12 months. Former customers count as new only after a defined gap, and the definition belongs in the written plan.

Who should own expansion revenue, the AE or the account manager?

The AE usually owns expansion for a short window after the first deal, often 90 days or until the first invoice is paid, and the account manager owns it after that. The handover trigger and the rule for open pipeline must be written down.

How do you stop reps calling an upsell a new deal?

Define revenue types by invoice history and group structure, make deal type a required field that someone else checks, keep the gap between rates moderate, and show the type and rate on each rep's statement so errors are caught before payout.

Sources

• Prowi jobstore, public job ads from company career pages, read 2 November 2026 (1,428 open sales and customer success ads in the three role families, recruiters excluded)
• California Labor Code section 2751
• UK Employment Rights Act 1996, section 27
• EUR-Lex: Directive (EU) 2019/1152 on transparent and predictable working conditions
• EUR-Lex: Council Directive 86/653/EEC on self-employed commercial agents