ARPPU

How to Calculate ARPPU

Calculating ARPPU is straightforward. You simply divide the total revenue generated by paying users during a given time frame by the total number of unique paying users in that same period.

The ARPPU Formula:

ARPPU = Total Revenue / Number of Paying Users

Example:

If a mobile game generates $10,000 in a month from in-app purchases, and 200 unique users made those purchases, the calculation would be:

$10,000 / 200 = $50 ARPPU

Note: This calculation typically excludes ad revenue, as ad impressions are generated by both paying and non-paying users.

ARPPU vs. ARPU: What is the Difference?

It is easy to confuse ARPPU with ARPU (Average Revenue Per User), but they serve very different analytical purposes:

Because most mobile apps operate on a freemium model where only a small percentage of users actually make purchases (often between 2% and 5%), your ARPPU will always be significantly higher than your ARPU.

Why is ARPPU Important in Mobile Marketing?

For mobile marketers and user acquisition (UA) managers, tracking ARPPU provides deep insights into the effectiveness of monetization strategies:

1. Campaign Optimization: By tracking which ad networks or campaigns yield users with the highest ARPPU, marketers can confidently allocate their budget toward acquiring high-value users rather than just focusing on raw install volume.

2. Pricing Strategy: If your ARPPU is low, it might indicate that your in-app purchase items are priced too low, or that users aren’t finding enough value to make repeat purchases.

3. Predicting Lifetime Value (LTV): ARPPU is a foundational metric for estimating user LTV, which in turn dictates your target Cost Per Acquisition (CPA) and Return on Ad Spend (ROAS).

How Affise MMP Helps Track and Optimize ARPPU

To accurately measure ARPPU, you need precise attribution data. This is where a Mobile Measurement Partner like Affise MMP becomes essential.

• Accurate Revenue Tracking: Affise MMP tracks deep in-app events, including one-time purchases and recurring subscriptions, ensuring your revenue data is exact and tied securely to the correct user.

• Granular Attribution: Affise links paying users back to the specific ad campaign, creative, and partner that drove the install. This allows you to see the exact ARPPU generated by individual traffic sources.

• Fraud Prevention: Fraudulent installs can skew your user data and ruin your metrics. Affise’s proactive anti-fraud tools ensure that your ARPPU calculations are based on real, legitimate paying users.

• Real-Time Dashboards: With Affise MMP, you can track changes to your ARPPU in real-time, allowing you to react immediately to pricing changes, seasonal events, or newly launched app features.

3 Strategies to Increase Your App’s ARPPU

If you are looking to boost your Average Revenue Per Paying User, consider these proven tactics:

1. Tiered Pricing and Upselling: Offer premium tiers, bundle packages, or exclusive limited-time offers to users who have already made a small purchase. Once a user breaks the «paywall,» they are more likely to spend again.

2. Targeted In-App Events: Use your MMP data to identify when users are most likely to make a purchase. Trigger specialized discounts or events (like holiday sales or weekend tournaments) precisely when engagement is highest.

3. Focus on User Retention: The easiest way to increase ARPPU is to keep your paying users around longer. Implement loyalty programs, VIP support, or exclusive content specifically for your paying cohort.