arpu facebook: Facebook’s average revenue per user leads social media companies

Mobile advertising revenue represented approximately 94% of advertising revenue for the second quarter of 2019. While the family of products, part of Meta has a massive user base, which in 2021 reached over 2.91 monthly active users worldwide. When it comes to monetization and the advertising machine, it’s mostly skewed toward users from US & Canada. Facebook is still the most popular social media platform on earth with 2.9 billion monthly active users . However, it’s growing more slowly than most of its competitors, who are catching up quickly.

Learn https://1investing.in/ing fundamentals and how to read financial statements with CFI’s free online accounting classes. In addition, ARPU is commonly used for segmentation analysis, as a comparison tool among peers, and in financial modeling. ARPU offers significant insights into profitability and revenue-generation capability. ARPU is commonly compared between similar companies operating in the same industry to assess how well the company is doing in comparison to its peers. India has the most Facebook users in the world with 280 million users followed by the United Nations with 190 million users.

Average revenue per user is useful in financial modeling, as it can make revenue assumptions easier to determine. For example, an analyst building a financial model for Facebook Inc. may choose first to determine user growth and then multiply it by a forward ARPU to forecast revenue. In Q2 2019, Facebook ARPU from Asia-Pacific touched $3.04 for the first time. Now in Q4 2019, the company generated on average $3.57 in revenue from each of its users from APAC. On the basis of gender, Male and Female active users account for approximately 57% & 43% respectively of the total active users globally. My thesis is that Facebook has achieved a high average revenue per user due to their consistent focus and they are well positioned for it to continue climbing.

Facebook: average revenue per user 2011-2022, by region

In that case, you might define a user as a seat or as an account, depending on your purpose . Now that we have determined both the number of goods sold as well as the price of each good, we can multiply these values together to calculate total revenue. If you’re selling a product that’s tangible, you’ll want to calculate the total number of units sold per each product.

• Mittal noted, “Salaries have gone up, rents have gone up except for one thing.
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• According to a survey of 18,100 marketers in 2021, 51.4% of marketers said they plan to increase paid social spend in 2022.
• Besides the $ value in terms of monetization, analyzing the data based only on the ARPU is quite limited.
• This result pales in comparison to the combined U.S. and Canada market, where Facebook’s APRU amounted to 58.77 U.S. dollars.
• The site can be accessed from any connected device or device with Internet connectivity, including personal computers, tablets, laptops, and smartphones.

Indeed, attention harvesting and the ability to sell it back to advertisers and marketers is Facebook’s primary business model. Revenue by user geography is geographically apportioned based on Facebook’s estimation of the geographic location of our users when they perform a revenue-generating activity. 65% of marketers have fully integrated organic and paid social efforts. The global population currently stands at 7.91 billion, which means 58.4% of the population uses social media. As of this year, over half the world’s population has social media presence—a mighty feat considering the technology has only been around a few short decades. Revenue per available room is calculated by multiplying a hotel’s average daily room rate by its occupancy rate.

The Ultimate Guide to Software as a Service (SaaS)

For example, if lots of users are willing to pay for a monthly subscription, push them toward an annual subscription for a lower monthly cost. Tiered pricing is a great way for users to choose which capabilities they’re willing to pay more for and potentially boost your ARPU. However, apps where user activity is more sporadic, such as travel or rideshare apps, would likely benefit from calculating a quarterly or annual ARPU. In short, Facebook might be described as a marketplace for attention, some users are just average, while a very few are power users and they do make a difference to the overall company’s strategy. Which means Facebook can better sell targeted ads to users, and monetize those ads by having marketers and companies pay for eyeballs.

Facebook is the most-used social media platform by marketers and the most effective, with the greatest ROIs. The top reason marketers use social media is to boost brand awareness, and engagement is widely considered to be the most important metric to track. If we broaden it out to look at larger regions, rather than individual countries, North America has the highest social media penetration rate at 82%. Next, let’s look at some social media statistics that tell us more about the people who use social networks and how usage varies across different demographics.

Statistics

They offer their customers a variety of options, which break down to either prepaid or postpaid versions. This works for some companies such as Comcast, which makes its money through basic subscriptions, premium subscriptions, and streaming purchases. Management delves into the ARPU number to see which products or business segments are performing best and worst.

According to Facebook statistics, Facebook ‘Like’ button has been pressed 1.1 Trillion times as of September 2018. Similarly, there are other buttons to express opinions that have also helped marketers or individuals gain popularity, raise brand rankings, and avail other benefits from such features. It has become a platform for connecting with fans and followers of brands, celebrities, etc. Now that we know what ARPU stands for, let’s dive into its definition. Average Revenue Per User is the total revenue your app generates averaged across all users.

This isn’t surprising given that China, India, and the US are the first, second, and third most populous countries. Globally, 53.9% of social media users are male, compared to 46.1% female. Facebook and TikTok rank in joint second place, with the average person using these platforms for around 19.6 hours every month. WhatsApp ranked third with an average usage time of 18.6 hours per month. Gen Z spends more time on social media than any other generation, and the amount of time users spend on social media per day seems to inversely correlate with age.

To use individual functions (e.g., mark statistics as favourites, set statistic alerts) please log in with your personal account. I give my consent to to be in touch with me via email using the information I have provided in this form for the purpose of news, updates and marketing. 21% of surveyed marketers said Facebook has the highest ROI of any platform, 18% said Instagram, 14% said Linkedin, 12% said TikTok, and 11% said YouTube. That figure is expected to rise to 74% by 2026, according to projections, as more people around the world get access to the internet.

Facebook makes more money per user than rivals, but it’s running out of growth options

Capital Expenditures – Capital expenditures, including principal arpu facebookments on finance leases, were $4.82 billion and $15.72 billion for the fourth quarter and full year of 2020, respectively. Webinars Watch on-demand featuring customers and industry experts. For Customer Advocacy Create engaging experiences for customers that drive loyalty and adoption. Integrations See how PostBeyond integrates with your technology. We share your personal information only when you give us explicit permission to do so, and confirm we have your permission each time. Moving into or copying rival territory is nothing new for Facebook.

I believe that if another company other than Facebook had bought Instagram in September 2012, then the acquisition would not have been as successful. This is because Facebook had the right advertising know-how and a wide breadth of advertisers ready to try the new platform. Facebook does not break out the ARPU for Instagram separately, but I’m confident that if anyone else would have bought Instagram, then the ARPU there would not be as high as it is currently. Growth marketing will place a higher level of importance on it when you are trying to build and grow your rocket ship . Understanding how your ARPU compares within the competitive landscape can help you gain insights into your pricing model.

Prepaid service requires the user to pay a flat fee monthly, in advance of using it. This is the “pay-as-you-go” option that can be canceled at any time. Others, such as media companies, focus on increasing advertising revenue.

This figure is most often reported by telecom companies and media companies. Yarilet Perez is an experienced multimedia journalist and fact-checker with a Master of Science in Journalism. She has worked in multiple cities covering breaking news, politics, education, and more. Her expertise is in personal finance and investing, and real estate. Full BioAmy is an ACA and the CEO and founder of OnPoint Learning, a financial training company delivering training to financial professionals. She has nearly two decades of experience in the financial industry and as a financial instructor for industry professionals and individuals.