Expansion revenue
Expansion revenue is additional revenue from customers a business already has: upgrades, add-ons, cross-sell, higher usage or a move to a richer plan. It is the component of growth that requires no acquisition spend and is therefore the highest-margin revenue in the business.
Why it matters for ARPU
In a large B2C base, expansion decisions are the dominant ARPU lever simply because the addressable population is everyone who already pays.
Related terms
Net revenue retentionNet revenue retention measures revenue from an existing cohort at the end of a period against its revenue at the start, including upgrades, downgrades and churn, but excluding new customers.ARPUARPU, average revenue per user, is total revenue in a period divided by the average number of active users in that period.Next best offerNext best offer selects the most valuable commercial proposition for a customer: which product, plan, bundle or price to present.Monetization rateMonetization rate is the share of active customers who pay anything in a period.