What is the difference between ARPU and ARPA?

ARPU measures revenue per user. ARPA (average revenue per account) measures revenue per paying account or company. For B2B SaaS products with multi-seat accounts, ARPA is often more meaningful because one account may have dozens of users. Use ARPU for consumer or per-seat pricing models. Use ARPA for account-level pricing models. This template works for both; just swap "user" for "account" in the denominator.

Should I include free users in my ARPU calculation?

It depends on your business model and audience. Including free users gives you a blended view that reflects your overall monetization efficiency (useful for investor reporting). Excluding free users gives you a clearer view of paying customer value (useful for pricing decisions). Track both. Report whichever is more relevant to the question you are answering.

How often should I review ARPU?

Monthly is the standard cadence for SaaS businesses. Quarterly deep dives (with segment and cohort breakdowns) are valuable for strategic planning. Weekly ARPU tracking is usually too noisy unless you are running active pricing experiments.

What is a good ARPU growth rate?

For B2B SaaS, 5-15% annual ARPU growth is typical for mature products. High-growth products with active expansion motions can see 20-30% annual ARPU growth. If your ARPU is declining while your user count grows, you are adding lower-value customers faster than you are expanding existing ones.

How does ARPU relate to LTV?

ARPU is one of the core inputs to [customer lifetime value](/glossary/ltv-customer-lifetime-value). LTV is approximately ARPU divided by monthly churn rate. A $100 ARPU with 3% monthly churn yields roughly $3,333 LTV. Use the [LTV/CAC calculator](/tools/ltv-cac-calculator) to model how ARPU changes flow through to unit economics. ---

ARPU Analysis Template for Product Analytics

What This Template Is For

Average revenue per user (ARPU) is one of the clearest indicators of whether your monetization strategy is working. A rising ARPU means users are finding more value and paying more over time. A flat or declining ARPU signals pricing problems, failed upsells, or a shift in your customer mix toward lower-value segments.

This template helps you decompose ARPU into its components, track it across segments and cohorts, and identify the levers that move it. It covers overall ARPU, new vs. existing user ARPU, segment-level breakdowns, and expansion revenue contribution. For a deeper look at SaaS revenue metrics and how ARPU fits into the broader picture, the Product Analytics Handbook covers monetization measurement in detail. The monthly recurring revenue glossary entry explains the relationship between MRR and ARPU.

Unlike vanity metrics that move with volume, ARPU tells you about the quality of your revenue. A product growing users at 20% per month but declining in ARPU is growing hollow. This template gives you the framework to catch that trend early.

When to Use This Template

During monthly or quarterly business reviews. ARPU trend is a core metric for any recurring revenue business.
After a pricing change. Measure whether new pricing actually improved revenue per user or just shifted the mix.
When expansion revenue stalls. Decompose ARPU to find which segments are upgrading and which are not.
Before board or investor meetings. ARPU trend is one of the first things investors ask about.
When launching a new plan tier. Track whether the new tier cannibalizes existing revenue or adds incremental ARPU.
During annual planning. Set ARPU targets by segment and tie them to product and pricing initiatives.

How to Use This Template

Step 1: Calculate Overall ARPU

Pull total revenue for the period (month or quarter) and divide by total active users. Use paying users only, or all users including free. Be consistent and document your denominator.

Step 2: Segment ARPU

Break ARPU by plan tier, company size, acquisition channel, geography, and cohort vintage. Segment-level ARPU reveals which customers are most valuable and which are undermonetized.

Step 3: Decompose Revenue Sources

Split revenue into base subscription, seat expansion, feature upgrades, add-ons, and usage-based charges. This shows whether ARPU growth is coming from new pricing or genuine adoption.

Step 4: Track Trends Over Time

Plot ARPU monthly for each segment. Three consecutive months of decline in any segment is an action trigger. Use the trend analysis section to document observations and planned responses.

Step 5: Compare to Benchmarks

Compare your ARPU to industry benchmarks and your own targets. The LTV/CAC calculator helps you model how ARPU changes affect lifetime value.

The Template

ARPU Overview

Field	Value
Product	[Your product name]
Period	[e.g., February 2026]
Denominator	[Paying users only / All users incl. free]
Currency	[USD / EUR / etc.]
Data Source	[Billing system, analytics platform]

Overall ARPU Calculation

Metric	Current Period	Prior Period	Change	YoY Change
Total revenue	[$X]	[$X]	[+/- %]	[+/- %]
Total active users	[N]	[N]	[+/- %]	[+/- %]
ARPU	[$X]	[$X]	[+/- %]	[+/- %]
ARPU (paying only)	[$X]	[$X]	[+/- %]	[+/- %]
ARPU (incl. free)	[$X]	[$X]	[+/- %]	[+/- %]

ARPU by Segment

Segment	Users	Revenue	ARPU	Change vs. Prior	% of Total Revenue
[Enterprise]	[N]	[$X]	[$X]	[+/- %]	[%]
[Growth]	[N]	[$X]	[$X]	[+/- %]	[%]
[Starter]	[N]	[$X]	[$X]	[+/- %]	[%]
[Free]	[N]	$0	$0	n/a	0%
Total	[N]	[$X]	[$X]	[+/- %]	100%

Revenue Decomposition

Revenue Source	Amount	% of Total	Change vs. Prior	Notes
Base subscription	[$X]	[%]	[+/- %]	[Core plan fees]
Seat expansion	[$X]	[%]	[+/- %]	[Added users within existing accounts]
Feature upgrades	[$X]	[%]	[+/- %]	[Plan tier upgrades]
Add-ons	[$X]	[%]	[+/- %]	[Optional purchased modules]
Usage-based charges	[$X]	[%]	[+/- %]	[API calls, storage, etc.]
Total	[$X]	100%	[+/- %]

ARPU by Cohort Vintage

Signup Cohort	Months Active	Current ARPU	Initial ARPU	ARPU Growth
[Q1 2025]	[12]	[$X]	[$X]	[+/- %]
[Q2 2025]	[9]	[$X]	[$X]	[+/- %]
[Q3 2025]	[6]	[$X]	[$X]	[+/- %]
[Q4 2025]	[3]	[$X]	[$X]	[+/- %]
[Q1 2026]	[0-3]	[$X]	[$X]	[+/- %]

Key question: Is ARPU growing within cohorts over time? If older cohorts have higher ARPU than newer ones at the same tenure, your expansion motions are working. If newer cohorts start at lower ARPU, your customer mix may be shifting downmarket.

ARPU Trend Analysis

Month	ARPU	MoM Change
[Month 1]	[$X]	[baseline]
[Month 2]	[$X]	[+/- %]
[Month 3]	[$X]	[+/- %]
[Month 4]	[$X]	[+/- %]
[Month 5]	[$X]	[+/- %]
[Month 6]	[$X]	[+/- %]

Expansion Revenue Tracking

Metric	Current Period	Prior Period	Change
Expansion MRR	[$X]	[$X]	[+/- %]
Accounts that expanded	[N]	[N]	[+/- %]
Avg expansion per account	[$X]	[$X]	[+/- %]
Expansion as % of new MRR	[%]	[%]	[+/- pp]

Action Items

☐ Calculate ARPU for the current period using consistent denominator
☐ Segment ARPU by plan tier, company size, and cohort vintage
☐ Decompose revenue by source to identify growth drivers
☐ Identify segments with declining ARPU and investigate root causes
☐ Set ARPU targets for next quarter by segment
☐ Review pricing and packaging levers for undermonetized segments

Filled Example: B2B SaaS (TaskFlow)

ARPU Overview

Field	Value
Product	TaskFlow
Period	February 2026
Denominator	Paying users only
Currency	USD
Data Source	Stripe + Amplitude

Overall ARPU

Metric	Feb 2026	Jan 2026	Change	YoY
Total revenue	$487,000	$469,000	+3.8%	+28%
Paying users	4,120	3,980	+3.5%	+22%
ARPU	$118.20	$117.84	+0.3%	+4.9%

Segment ARPU

Segment	Users	Revenue	ARPU	MoM Change	% Revenue
Enterprise	310	$186,000	$600	+1.2%	38.2%
Growth	1,420	$198,800	$140	+0.7%	40.8%
Starter	2,390	$102,200	$42.76	-0.5%	21.0%
Total	4,120	$487,000	$118.20	+0.3%	100%

Key finding: Enterprise ARPU is growing (+1.2%) driven by seat expansion. Starter ARPU is declining (-0.5%) as the tier attracts smaller teams. Overall ARPU is nearly flat because the user mix is shifting toward lower-ARPU Starter plans. The net revenue growth (+3.8%) is driven almost entirely by volume, not monetization improvement.

Revenue Decomposition

Revenue Source	Amount	% of Total	MoM Change
Base subscription	$358,000	73.5%	+2.1%
Seat expansion	$72,000	14.8%	+8.4%
Feature upgrades	$38,000	7.8%	+6.2%
Add-ons	$19,000	3.9%	+1.0%
Total	$487,000	100%	+3.8%

Insight: Seat expansion (+8.4%) and feature upgrades (+6.2%) are the fastest-growing revenue sources. This suggests the product is getting stickier within accounts. The opportunity is converting more Growth-tier accounts into expansion candidates.

Key Takeaways

Track ARPU by segment, not just overall. A flat overall ARPU can hide declining segments masked by growing ones.
Decompose revenue by source to understand whether ARPU growth is coming from pricing power or genuine adoption.
Cohort-level ARPU shows whether your expansion motions work over time. Use the Product Analytics Handbook for cohort methodology.
The NPS calculator can help you correlate satisfaction scores with ARPU trends by segment.
Three consecutive months of declining ARPU in any segment should trigger investigation and intervention.
Set separate ARPU targets for new and existing customers. New customer ARPU is a pricing signal. Existing customer ARPU is an expansion signal.

About This Template

Created by: Tim Adair

Last Updated: 3/5/2026

Version: 1.0.0

License: Free for personal and commercial use

ARPU Analysis Template for Product Analytics