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Troops are upgraded using Gems, do not however waste Gems upgrading infrequently used troops such as the Grendaliers.
You can get Gems several ways, they can be picked up as a daily log in reward, free spin award, and Treasure Box item. Gems will also appear as a reward when you complete a certain mission or after leveling up.
Completing Single-Player campaign missions with a 3 star rank in ALL the stages is the easiest way to obtain Gems.
Once you have upgraded your flags you should next upgrade your troops followed by the Air Base Planes, the Defense Center, Barracks, and all the other buildings.
The first thing you should upgrade is your Flags as they determine the size of your amy, the larger your possible population the bigger your army.