Average Revenue Per User (ARPU) Measure
An Average Revenue Per User (ARPU) Measure is a B2C revenue-based performance measure (for B2Cs) based on total revenue divided by the number of users.
- Context:
- It can be related to ARPPU (Average Revenue Per Paying User), and a ARPDAU (Average Revenue Per Daily Active User).
- It can (often) be an Online Service KPI.
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- Example(s):
- Counter-Example(s):
- See: Customer Relationship Management, Value-Added Services, Subscription Business Model, Gamification.
.References
2020
- (Wikipedia, 2020) ⇒ https://en.wikipedia.org/wiki/Average_revenue_per_user Retrieved:2020-5-15.
- Average revenue per user (ARPU), sometimes known as average revenue per unit, is a measure used primarily by consumer communications, digital media, and networking companies, defined as the total revenue divided by the number of subscribers.
The term is used by companies that offer subscription services to clients for example, telephone carriers, Internet service providers, and hosts. It is a measure of the revenue generated by one customer phone, pager, etc., per unit time, typically per year or month. In mobile telephony, ARPU includes not only the revenues billed to the customer each month for usage but also the revenue generated from incoming calls, payable within the regulatory interconnection regime.
Digital media and social media companies, which rely heavily on ad revenue generated by users with free accounts, pay particularly close attention to their ARPU. Variations in ARPU reflect changes in the companies' ability to generate revenue and heavily impact their stock prices [1] . That provides the company a granular view at a per user or unit basis and allows it to track revenue sources and growth.
There is a trend by telecommunications and Internet companies and their suppliers to sell extra services to users and a lot of the promotion that is used by the companies talks of increased ARPU for the operators. It typically manifests in the form of value-added services such as entertainment being sold to customers especially in markets where the primary service offered to the customer, such as the telephony or Internet service, is sold at a commodity rate.
- Average revenue per user (ARPU), sometimes known as average revenue per unit, is a measure used primarily by consumer communications, digital media, and networking companies, defined as the total revenue divided by the number of subscribers.
2020
- (Wikipedia, 2020) ⇒ https://en.wikipedia.org/wiki/Customer_relationship_management#Call_centers Retrieved:2020-5-15.
- Contact center CRM providers are popular for small and mid-market businesses. These systems codify the interactions between company and customers by using analytics and key performance indicators to give the users information on where to focus their marketing and customer service. This allows agents to have access to a caller's history to provide personalized customer communication. The intention is to maximize average revenue per user, decrease churn rate and decrease idle and unproductive contact with the customers. …
2019
- https://www.investopedia.com/terms/a/average-revenue-user-arpu.asp
- QUOTE: ... Average revenue per user (ARPU) is the measure of revenue generated per user or unit. ARPU, a non-GAAP measure, allows management of a company as well as investors to refine their analysis of a company's revenue generation capability and growth at the per-customer level.
Average revenue per user (ARPU) is the equivalent to total revenue divided by average users during a period. The period end-date is not the measure date for the denominator because the number of units can fluctuate intra-period. Instead, the beginning of the period and the end of the period numbers are typically averaged. A weighted average could also be used, if appropriate. …
- QUOTE: ... Average revenue per user (ARPU) is the measure of revenue generated per user or unit. ARPU, a non-GAAP measure, allows management of a company as well as investors to refine their analysis of a company's revenue generation capability and growth at the per-customer level.
2019
- https://www.thegoodestate.com/facebook-arpu/
- QUOTE: Facebook defines their Average Revenue per User (ARPU) as “as their total revenue in a given geography during a given quarter, divided by the average of the number of MAUs in the geography at the beginning and end of the quarter”. But how high is actually the Average Revenue per User (ARPU) of Facebook? ...
... Most recent Update: In Q3-2019 Facebook reported that the average revenue per user (ARPU) has been 24.96 USD globally.
- QUOTE: Facebook defines their Average Revenue per User (ARPU) as “as their total revenue in a given geography during a given quarter, divided by the average of the number of MAUs in the geography at the beginning and end of the quarter”. But how high is actually the Average Revenue per User (ARPU) of Facebook? ...
2006
- (McCloughan & Lyons, 2006) ⇒ Patrick McCloughan, and Sean Lyons. (2006). “Accounting for ARPU: New Evidence from International Panel Data.” Telecommunications Policy, 30(10-11).
- ABSTRACT: Average revenue per user (ARPU) is commonly used by regulators and industry observers to compare the performance of mobile telephony markets. Under the new EU electronic communications regulatory framework, some national regulatory authorities (NRAs) have linked higher ARPU with ‘significant market power’. This paper empirically examines the determinants of ARPU in a systematic way, taking account of service quality, market environment, regulation and quantity of service. The robust results suggest that concentration may not be a reliable indicator of competition in mobile markets; there are economies of density in mobile markets; and higher GDP per capita increases ARPU.