What is Average Revenue Per User (ARPU)?
Average Revenue Per User (ARPU) is a metric that app advertisers use to measure the average revenue generated by each user through advertising, in-app purchases, and other monetization methods.
How do you calculate Average Revenue Per User (ARPU)?
To calculate ARPU, you divide the total sum of revenue from a specific group of users (e.g., monthly active users or daily active users) by the total number of users in that group (number of installs from your tracker) over a specific period of time.
ARPU = Revenue / Installs
Why is Average Revenue Per User (ARPU) important?
ARPU helps you understand your user base's revenue potential, track revenue changes over time, and optimize your advertising and monetization strategies to maximize revenue. By analyzing ARPU data, you can identify the segments of your user base that generate the most revenue, determine the most effective monetization methods, and make necessary changes to improve revenue generation.
For example, if your app has an ARPU of $1.50 and you want to increase revenue, you may consider trying different monetization strategies, such as adding new in-app purchase options or increasing ad frequency. By analyzing the impact of these changes on ARPU, you can use data-driven decision making to optimize your monetization strategies and increase revenue generation.