Let's say you have an online store that specializes in selling travel products. In May, the store showed the following results:
Number of clients – 200, income – 800,000 rubles.
ARPU – 800,000 : 200 = 4,000 rubles.
In September, you launched contextual advertising. The situation may develop as follows:
ARPU will decrease ARPU will increase
Number of clients from advertising – 220 Number of clients from advertising – 220
Income – 850,000 RUB. Income – 1,000,000 RUB.
ARPU – RUB 3,863
(850,000 : 220) ARPU – RUB 4,545
(1,000,000 : 220)
Revenue levels increased, but advertising was ineffective, so ARPU fell The advertising showed high efficiency, so the indicator increased
Let's say you've determined that conversion to order and ARPU are higher for customers who receive email newsletters.
ARPU is calculated as the average engineer data package revenue generated by each user who visited an online store over a specific period of time.
With this metric, companies analyze unit economics and determine the effectiveness of various advertising channels. To do this, specialists divide clients into groups based on various characteristics, called cohorts. After that, they compare the profitability of each part using the ARPU indicator. This makes it possible to compare the income from different categories of users. For example, from new and returning clients, users with a certain smartphone and browser, from a specific locality, etc.
By calculating the indicator, you can increase the effectiveness of advertising campaigns, find weaknesses in the product, determine development directions, increase conversion and revenue levels.
Download a free selection of tools for calculating KPIs and increasing marketing metrics
Alexander Kuleshov
Alexander Kuleshov
General Director of Sales Generator LLC
Read more posts on my personal blog:
Over the past 7 years, we have conducted over 23,000 comprehensive website audits and I have learned that all of us as leaders need clear and working algorithms for our marketing and sales.
Today we will share with you 6 of the most valuable documents that we have developed for our clients.
Download for free and implement today:
Step-by-step guide to creating marketing KPIs
Template for calculating KPIs for a marketer
9 Examples of Universal Selling Commercial Proposals
Upgrade your CPs to close more deals
How to make KPI for the sales department so that profits grow by 20% or more?
Step-by-step template for calculating KPIs for OP managers
Checklist of 12 main indicators for website promotion
Find out what metrics are needed to properly optimize your website
40 Services for Working with Blog Content
We have collected the best services for working with content
How to define your target audience without mistakes?
A proven guide to defining a company's target audience
Download the collection for free
pdf 8.3 mb
doc 3.4 mb
Already downloaded
153319
Determining the effectiveness of UI/UX changes and interface personalization
One company implemented a website personalization mechanic based on user behavior prediction. The system predicts whether a user will make a purchase after adding an item to the cart or leave the site. These predictions help determine the most appropriate moment to encourage the customer to buy by showing a pop-up in the cart. As a result, ARPU increased by more than 30%.
Determining the level of efficiency
Source: shutterstock.com
Benetton placed personalized recommendations on the homepage of its online store, offering related and similar products on the product page, and also reminding users of abandoned carts via email. The increase in ARPU indicated that the company's strategy was successful.
Assessing customer reactions in the process of testing price marketing hypotheses
Let's consider the same online store of tourist goods that decided to test the price marketing hypothesis by increasing the price of its most popular product - trekking shoes.
September October
Cost of spinning rod 3500 ₽ 4000 ₽
Number of customers who viewed or purchased the product 30 25
Income per month 70,000 ₽ 64,000 ₽
ARPU 2333 ₽
(70 000 ₽ : 30) 2560 ₽
(64 000 ₽ : 25)
Although the revenue from shoe sales decreased, ARPU increased. This indicates that the decrease in revenue is not due to a change in the price of the product. Therefore, the company can continue to attract new customers without changing the price of the product.