### Metric Guide

#### Average Revenue per User

###### Calculation

To calculate ARPU, you need to divide total revenue by the total number of users during a given period of time. This calculation will yield a single number that gives you an idea of how much money each user contributes to your overall revenue. However, it’s important to note that this calculation doesn’t take into account any other factors that might affect the amount of money each individual user generates, such as the type or quality of product or service they are purchasing.

$$\frac{Revenue}{Paying\:Users}$$
###### Importance

ARPU is an important metric because it helps you understand the effectiveness of your monetization strategies. It also can give you insights into which types of customers generate the most revenue and which don’t so that you can focus on targeting those high-value customers. Additionally, ARPU helps identify areas where there may be room for improvement in terms of monetization and customer acquisition strategies.

We're here to help!

### Book a free consultation

We've helped hundreds of companies set up their data strategy

Metrics Frameworks

Modern Data Statck