Also known as: ARPA, average revenue per user, ARPU

Average Revenue Per Account

ConceptualMetricsFinance

Definition

Average Revenue Per Account: Average Revenue Per Account (ARPA) is total recurring revenue divided by the number of accounts. It measures typical customer value and trends over time. Growing ARPA through upsells and moving upmarket increases revenue without proportionally increasing customer count.

Example Usage

“Our ARPA grew from $200/month to $350/month by adding premium tiers and usage-based pricing. Same customer count, 75% more revenue.”

Common Misconceptions

ARPA should always increase. Growing ARPA while maintaining volume is ideal; sacrificing volume for ARPA may not be.

ARPA tells the whole story. Segment ARPA by customer type—SMB, mid-market, enterprise have different economics.

Use ARPA for all benchmarking. ARPA varies dramatically by market and model; compare within your segment.

Related Terms

Customer Lifetime Value

Customer Lifetime Value (LTV) is the total revenue a business can expect from a single customer account over the entire relationship. LTV is calculate...

ConceptualMetricsFinance

Unit Economics

Unit economics refers to the direct revenues and costs associated with a single unit of a business (a customer, product, or transaction). Positive uni...

ConceptualMetricsFinance

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Average Revenue Per Account

Definition

Example Usage

Common Misconceptions

Related Terms

Customer Lifetime Value

Unit Economics

Related Tools

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