RPV
RPV is a business indicator that stands for “revenue per visitor”.
This metric is widely used in online marketing to calculate the average revenue from each unique visitor. In another way, it is also called the average cost per order from a unique user.
This indicator is evaluated for different purposes:
- assessment of the actions of site visitors who made a purchase and generated income;
- determine which sales strategies are profitable and which are not;
- calculate how much money you can allocate to attract new customers.
The revenue per visitor is calculated as follows: the total revenue is divided by the number of visitors to the site for a certain period of time. For example, if the income from the site for three months was $30 thousand and during this period there were 5 thousand visitors, then the RPV will be equal to 30,000/5,000 = $6 per visitor.
This metric was designed specifically to close the gaps in the Conversion Rate (CVR) calculation, which takes into account all website visitors. The essence of the idea was that not every visitor becomes a client, and when calculating “revenue per visitor”, not all, but only unique visitors are taken into account.
As a rule, almost 99% of those who first visited the site do not buy anything — they just ask the price and look for where it is cheaper, comparing prices. Before an expensive purchase, the client needs to think and from the first visit to the site he will not buy anything. If you take into account when calculating all visitors, then you will get a distorted result of how much you will earn from one site visitor.
Using the RPV metric, you can more accurately calculate the site conversion and income from one visitor who actually made a purchase, and not all in a row. You will also be able to more accurately determine how effectively trading is being conducted.
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