What is the difference?

# ASP vs ARPA

Average Selling Price

Average Revenue Per Account

#### What is it?

Average Selling Price (ASP) is the average price a given product is sold for. This metric can be applied narrowly to a product or service or, more broadly, to an entire market. It's a common metric, often used to compare businesses or channels and is particularly interesting as a reflection of what consumers will pay for similar products or services.

Average Revenue Per Account (ARPA) is the average revenue generated per account per year or month. It is used as an indication of revenue generation capability and the ability to meet targets.

#### Formula

ƒ Sum(Product or Service Revenue) / Count(Products or Services sold)
ƒ Sum(Revenue) / Count(Accounts)

#### Example

A luxury watch maker is able to demand an ASP of \$3,900 per watch by selling 20 watches at \$3,000 and 5 watches at \$7,500 each month. Compare this to a high volume watch manufacturer, who sells 2,500 watches at \$50 and another 7,500 at \$30 each; resulting in an ASP of \$35.

Consider a company has 1000 accounts and is generating \$100,000 in revenue per month. Average Revenue per Account would be, ARPA = \$100,000 / 1000 = \$100 per account per month

#### Published and updated dates

Date created: Feb 3, 2019

Latest update: Dec 16, 2020

Date created: Apr 28, 2018

Latest update: Aug 7, 2020