Reconciling ARPU decline with Growth
by Will HankinsonI've been running IntroCave for 28 months now, and I feel like I've made a ton of improvements. I see that in the top-line revenue and traffic/engagement stats, but I've consistently felt like I was failing. The average ARPU (measured simply as daily revenue / GA users) has consistently declined over time from around $0.07/user to around $0.04/user.
It's not a super actionable stat, but it's easy to throw in my spreadsheets because I already track daily/monthly users and revenue.
I would periodically scan back through my monthly data and see if I could spot big drops, then go through the git logs for that month and see what changed. I considered reverting the site back to its 2018 state to see if the ARPU came back up.
I don't know why this popped into my head, but I went back over the historical data and pulled out just the data for my Big 4 countries (US/UK/Canada/Australia). The data is not rock solid (I don't really track users that way, so going off of GA conversion reports and AdSense breakdowns), but there's a pretty clear trend.
The Big 4 consistently make up around 70% of my revenue, but only 15-25% of my traffic (and declining as a percent over time). Estimated ARPU in just that group has steadily ticked up from ~$0.10 to ~$0.20 since 2018.
While the global traffic has SURGED (~1,300/day to ~4,500/day), traffic for the Big 4 is only up ~20%. I'm doing a lot more revenue with about the same number of users, it turns out.
It's a huge relief, but it's also a dilemma. Do I focus on growing the 30% of revenue that comes from global traffic (thinking about adding a separate UPI/RuPay processor since Stripe doesn't support it AFAICT) or double down on just the Big 4? Is there anything I can even do to just focus on the Big 4?
One more thing I'm considering as a result of this: tagging user signups with a reverse-IP estimate of their country. I would need to do this to present different payment options, but it would also open up the possibility of segmenting my emails further. Is it even worth keeping the global traffic on my newsletter? Sending emails to 20k users is logistically a lot easier than 80k users.
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I'd expect growth to be difficult in the "big 4", because the competition is also difficult. I'd focus on whatever brings me the most ROI out of, say, 5 hours of work. Do I make more focusing on the big 4 or on the rest?