Ad Revenue per User
Average advertising revenue generated per monthly active user on ad-supported tiers
What is Ad Revenue per User?
Ad revenue per user is the advertising income earned for each monthly active user on an ad-supported tier. It shows how well an audience is monetised through advertising.
Media businesses use it to compare the value of ad-supported users with subscribers and to judge audience growth.
How this KPI is measured
- Function
- Sales
- Sub-function
- Ad Revenue
- Industry
- Media & Entertainment
- Type
- Lagging
- Impact
- Revenue
- Unit
- $/user
- Measurement frequency
- Monthly / Quarterly
- Formula
- Total advertising revenue / Average MAUs on ad-supported tier
How to calculate it
Divide total advertising revenue by the average monthly active users (MAUs) on the ad-supported tier.
For example, if advertising earned 900,000 in a month from an average of 300,000 monthly active users, the figure is 3 per user.
Use the same period and definition of an active user each time, and segment by platform and region.
Where it is used
Valuing the audience
Estimate what each user is worth to advertisers.
Comparing tiers
Weigh ad-supported use against subscription.
Setting growth targets
Plan revenue from audience growth.
How to improve it
Tips and common mistakes
- Do not raise ad load so far that users leave.
- Compare by platform, since mobile and web differ.
- Read alongside retention.
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