What is ARPA?
ARPA is a core concept in modern B2B revenue. Here is a clear, accurate definition, why it matters, and how Ardovo handles it.
Short answer
ARPA, or average revenue per account, is the average recurring revenue a business earns per customer account over a period. In B2B, where one account contains many users, ARPA is usually more meaningful than per-user metrics. It is a core input to unit economics, cohort analysis, and revenue forecasting.
Key takeaways
- Recurring revenue divided by number of accounts.
- More meaningful than per-user metrics in B2B.
- A core input to LTV and unit economics.
- Segment it to compare account value across tiers.
Why it matters
In B2B you sell to accounts, not individuals, so ARPA reflects real deal economics. Rising ARPA through expansion is one of the most efficient ways to grow revenue.
How Ardovo handles it
Ardovo reports ARPA by segment and cohort from live billing, and ties it to the deals and expansions that moved it. Rook highlights accounts below their segment's ARPA as expansion opportunities.
Frequently asked questions
How do you increase ARPA?
Upsell to higher tiers, cross-sell additional products, reduce discounting, and target higher-value segments. Expansion within existing accounts is usually the most efficient lever.
Is ARPA the same as ACV?
Not exactly. ARPA is average recurring revenue per account over a period. ACV is the annualized contract value of a specific deal or customer. They are related but measured differently.