Definition
ARPA shows how much a typical customer pays and whether that is moving up market or down. ARPU, average revenue per user, is the per-seat equivalent.
Formula
ARPAARPA = MRR ÷ Number of active customer accounts
Example
Demo Co has $255.1K of MRR across 212 customers: ARPA of about $1,203 a month.
Benchmarks
There is no universal target; watch the trend and the mix. Rising ARPA with stable churn is usually healthy.
Common mistakes
- Dividing by a customer count that includes duplicates.
- Averaging away a few very large accounts that drive the business.
Examples use Demo Co, a fictional $3M ARR SaaS company, or a generic company where noted. Benchmarks are common reference points, not targets for every business.