Media, luxury and education
ARPPU (average revenue per paying user)
Revenue divided by only the users who pay, not all users.
Last reviewedWhat does ARPPU (average revenue per paying user) mean?
ARPPU is revenue in a period divided by the number of users who paid anything in that period. It differs from ARPU, which divides by all users, including free ones. It matters most in free-to-play games and freemium apps, where most users never pay. ARPU = payer conversion x ARPPU. Example: a game has 1 million monthly users, and 30,000 of them spend a total of 600,000, so ARPPU is 20, payer conversion is 3 percent and ARPU is 0.60. A few big spenders, sometimes called whales, often provide much of the revenue.
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Related terms
- ARPU (average revenue per user)Revenue divided by the average number of users.
- Payer conversionThe share of users who pay for something in a period.
- DAU/MAU ratioDaily active users divided by monthly active users: how often people come back.
- Pareto principle (80/20)A small share of causes often drives a large share of results.
- SVOD and AVODStreaming paid for by subscription (SVOD) versus paid for by advertising (AVOD).
- Fill rate (advertising)The share of available ad slots that are actually sold and shown.
- Content amortizationSpreading the cost of films and shows as an expense over the years they are expected to earn.
- Directly operated store (DOS)A store the brand owns and runs itself, rather than selling through another retailer.