What is ARPU?
ARPU typically stands for Average Revenue Per User. It is used mainly in the telecoms sector, where revenues can be roughly calculated based on an average of all of its customers. The general theory is that maximising ARPU increases profit and thus measuring this way helps the business to focus on developing more value from its customers.
ARPU is also used as a yardstick for assessing the value of specific client groups, and assessing the products and services which are marketed to those groups. For example, a low ARPU customer might be targetted with bonus offers in order to increase their revenue contribution. By including services which are more applicable to this user group the client is considered to be stickier, i.e. the client would have to change several services if it decided to take it's business elsewhere. Making a stickier customer ensures ARPU is increased for longer periods.
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