Average Revenue Per User (ARPU)


The average monthly recurring revenue from a paying customer.


Compare month-to-month performance per customer. Estimate how many customers you need to reach and acquire to achieve a certain MRR. Get a crude overview of which plans/prices customers prefer. More information in How to use ARPU


Keep an upwards trend. No optimal value. The lower the ARPU, the more customers needed. Downwards trend ok when customers are moving to annual plans and long-term business value rises.

To Improve it:

Adjust plan pricing & marketing. Reduce downgrades, increase upgrades. Offer add-ons and related products to existing customers. Reduce refunds and discounts.


Customer Life-Time Value (CLTV)


MRR / Number of Paying Subscriptions


To get CLTV right, if you include non-paying customers to churn calculations, include them also to ARPU calculations.


In principle, ARPU seems to be a cover-all term for all per-unit revenue metrics.
Can also be calculated per segment e.g. ARPU for new customers, ARPU per plan For non-SaaS businesses, calculate it from revenue. For cost-profit comparisons, can include also free plan and trial customers. Can also be calculated per user/seat instead of customer/account/subscription.

Also Called:

Average Revenue Per Account (ARPA),
Average Revenue Per Unit (ARPU),
Average Revenue Per Paying User (ARPPU)