2 Internet Marketing Acronyms You Must Know

ASV-Average Subscriber Value

This is the measure of revenue each subscriber represents to your business over a given time period (usually 1 year). This is often associated with an email list, but can be applied to offline marketing lists as well. If you are building a list (and nearly every online business should be), it is important to understand this value as it helps you understand the resources you should allocate to get more subscribers.

To be clear, the model I present here is not scientific, it is simplistic, and it gets you thinking. Example, a given site or blog started with 1000 subscribers January 1, and by December 31 they had 2500. During the same period, subscribers added in $300,000 in revenue (can be product or services sales, ad revenue, or affiliate revenue), to the business.

My simple formula is to take an average value for each given period, so in this case, at the beginning of the year, 1000/300,000 = 300 Average Subscriber Value, while at the end of the year the number is 2500/300,000 = 120. To get the average, we’ll add both numbers and divide by 2, (300+120)/2 = 210. While it can vary, you have an idea that for each subscriber you acquire, it means $210 in revenue to your business. This information can be invaluable when determining what to spend to acquire more subscribers.

It is worth noting this does not account for cost of goods sold, etc. There is a more complicated and comprehensive calculation, also an acronym called CLV-Customer Lifetime Value which involves understanding what a customer means to your business in revenue over (usually) a 3 year period.

Internet Marketing Acronyms Mean Business

When it comes down to it, it is important to understand acronyms, but more importantly the right ones which will help to measure your business. Whether your small business marketing tasks involve measuring your progress with things such as CR (conversion rate) or ASV (average subscriber value), (not mentioning any ppc campaign management acronyms!) your online marketing strategy should incorporate key metrics so you know you are moving in the right direction with search engine optimization, or other internet marketing strategies.

Now it’s your turn: Are you doing any tracking? (no worries, many don’t) If so, what is your key metric? If not, do this, with last years revenue in mind, divide by your current subscribers count. That is your (rough) ASV. Surprised? shocked? Feel free to share your thoughts here in the comments boxes below.