Canonical URL: https://chargezen.com/glossary/arpu-average-revenue-per-user

Revenue

# ARPU

Average Revenue Per User

The average amount of revenue generated per subscriber over a specific period. Calculated by dividing total revenue by the number of active subscribers.

## What is ARPU?

Average Revenue Per User (ARPU) measures how much revenue each customer contributes on average. It's a key indicator of pricing effectiveness and customer monetization. **Strategies to increase ARPU:** - Introduce premium tiers or add-ons - Implement usage-based pricing - Cross-sell complementary products - Offer bundles at higher price points - Reduce discounting ARPU trends over time reveal the effectiveness of your pricing strategy and product development efforts.

### Formula

ARPU = Total Revenue ÷ Number of Active Subscribers

### Example

If monthly revenue is $100,000 from 2,000 subscribers, ARPU = $50.

### Why ARPU Matters

ARPU directly impacts your unit economics. Increasing ARPU without increasing costs improves profitability.

### Related Terms

[

MRR

Revenue



](https://chargezen.com/glossary/mrr-monthly-recurring-revenue)[

LTV

Revenue



](https://chargezen.com/glossary/ltv-lifetime-value)[

AOV

Revenue



](https://chargezen.com/glossary/aov-average-order-value)

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### More Revenue Terms

[View all Revenue definitions](https://chargezen.com/glossary?category=Revenue)

[

Previous

LTV



](https://chargezen.com/glossary/ltv-lifetime-value)[

Next

AOV



](https://chargezen.com/glossary/aov-average-order-value)

## Explore More Terms

Browse our complete glossary of e-commerce and subscription terms.

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