Unit economics

Analyzing Business Data in SQL

Michel Semaan

Data Scientist

Unit economics

Unit economics: Measures performance per unit, as opposed to overall performance
Example: Average Revenue Per User (ARPU)
- Formula: $\frac{Revenue}{Count\:of\:users}$
- Use: Measures a company's success in scaling its business model

ARPU - query (I)

WITH kpis AS (
  SELECT
    SUM(meal_price * order_quantity) AS revenue,
    COUNT(DISTINCT user_id) AS users
  FROM meals
  JOIN orders ON meals.meal_id = orders.meal_id)

SELECT
  ROUND(
    revenue :: NUMERIC / GREATEST(users, 1),
  2) AS arpu
FROM kpis;

ARPU - query (I) by month

WITH kpis AS (
  SELECT
    DATE_TRUNC('month', order_date) AS delivr_month,
    SUM(meal_price * order_quantity) AS revenue,
    COUNT(DISTINCT user_id) AS users
  FROM meals
  JOIN orders ON m.meal_id = o.meal_id
  GROUP BY delivr_month)


SELECT
  delivr_month,
  ROUND(
    revenue :: NUMERIC / GREATEST(users, 1),
  2) AS arpu
FROM kpis
ORDER BY delivr_month ASC;

ARPU - query (II)

WITH user_revenues AS (
  SELECT
    user_id,
    SUM(meal_price * order_quantity) AS revenue
  FROM meals
  JOIN orders ON meals.meal_id = orders.meal_id
  GROUP BY user_id)

SELECT
  ROUND(AVG(revenue) :: NUMERIC, 2) AS arpu
FROM user_revenues;

Comparing the two ways

First way

revenue    users
---------  -----
260226.75  1304

Second way

user_id  revenue
-------  -------
0        262.75
1        160.5
2        255.25

ARPU - result

arpu
------
199.56

Unit economics

Analyzing Business Data in SQL