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  • How to calculate the ARPC for a prepaid SaaS?

    updated 3 years, 6 months ago 0 Member · 1 Post
  • Charles

    July 31, 2019 at 12:02 am

    I am looking at calculating the average monthly revenues I get from my customers so that I know their monthly “value” and be able to factor in the site’s visits+conversion rate in order to set our sale’s objectives. The situation is the following: two services, one that sells through a 3 year contract where each generates a revenue of several thousands per month for a handful of customers, while the second one is a prepaid service without contract that costs $50 or less; customers register, buy some credits and spend them with one or several subscriptions for as long as they want and can also spend their credits over some other features. They can also leave and never come back but their account will still show a positive balance. They can also register and fund their account and start a subscription 6 months later… Some prepaid will also pay up front a large amount of money every two or three months, while some others will pay just enough to cover their monthly fees, each month. So this means it’s a bit complicated to know who is an active customer within these prepaids unless I just count who has a subscription or used a feature during a given month, which will be different from how many have deposited some funds. How would you calculate the ARPC; By totaling the overall customer revenues (monthly deposits) dividing by the number of only those that currently have a subscription or used a feature? Does that make sense? This however looks more like active users than just customers. I feel like I would cheat by just defining customers by those that have funds in their account, that is my whole issue. An alternative would be to calculate the overall revenues from all customers and just divide their individual total they spent since they registered by the number of months they were in the system (just consider them gone if no funds have been added since 4 months or so). I think this would be misleading though as there is data for several years already. Also, would you mix the postpaid and prepaid revenues? Any hints appreciated, thanks ! – by hq overview makafre – –

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