A macro-level productivity metric, EPS (Earnings Per Subscriber) determines the average revenue generated by each active member of a subscription-based service’s user database over a specific timeframe, such as a month or a fiscal year. This metric helps streaming services like Dropout assess the financial performance of their subscriber base.
How to Calculate EPS
To find the EPS, divide the total revenue attributed to the service over a specific period by the total number of active subscribers during that same period.
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Applications of EPS
- Monetization Health: EPS acts as a barometer for the overall monetization health of a subscriber list.
- List Fatigue: It is particularly useful for identifying list fatigue or the impact of aggressive mailing frequencies.
- Subscriber Quality: If a list is growing in size but the EPS is declining, it suggests that the new subscribers are of lower quality or that the existing audience is becoming disengaged.
- Engagement: Conversely, a rising EPS indicates that segmentation, personalization, and automation efforts are effectively increasing the value of the existing audience without requiring a massive influx of new leads.
Use Case: Dropout Streaming Service
Dropout, an American comedy subscription streaming service founded in September 2018, uses EPS to evaluate the financial performance of its subscriber base. The service features ad-free original shows, including live play, improv comedy, and panel shows. By monitoring EPS, Dropout can assess the effectiveness of its content strategy and subscriber engagement initiatives.
Additional Acronyms for EPS
- EPS - Encapsulated PostScript
