To support the revenue guarantee described in the Agreement, this Schedule outlines the methodology PDQ uses to calculate performance impact and validate annualized revenue gains.
Core Metric: Average Revenue per Checkout (ARPC)
Average Revenue per Checkout (ARPC) is PDQ’s primary performance indicator. It reflects the average revenue generated from each checkout initiated on the merchant’s site. ARPC measures the revenue generated per initiated checkout, including both conversion rates and full order value (products + shipping). It’s calculated by dividing total revenue by total checkouts in a given period, offering a comprehensive view of checkout performance. It is calculated as:
ARPC = Total Revenue / Total Checkout Initiations
This metric includes (1) Completed orders and partial funnel exits (2) Revenue from products and shipping fees (3) All currencies normalized to USD or agreed-upon baseline.
By encompassing both conversion rates and order values, ARPC provides a holistic view of checkout performance and the effectiveness of PDQ's optimization.
Test-Based Measurement Approach
To validate impact, PDQ will conduct a minimum of six A/B tests within the first three months following implementation. Each test will (1) Be properly scoped and implemented via the PDQ platform (2) Include a statistically significant control and variant group (3) Run for a sufficient period to capture meaningful data (typically 2+ weeks) (4) Monitored by PDQ for data quality, traffic integrity, and conversion hygiene.
Annualized Revenue Modeling
To project long-term impact, PDQ applies a Cumulative Lift Model, using A/B test results to estimate ARPC gains across segments. Each test's lift is annualized based on duration, traffic, and segment size. Compounded over time (assuming stable traffic and no regression), this model translates short-term improvements into robust, annualized revenue forecasts and ROI estimates.
PDQ uses a Cumulative Lift Model to project the long-term value of improvements validated through A/B testing. This modeling involves (1) Calculating the ARPC lift per test, per segment (2) Normalizing for traffic exposure, test duration, and merchant seasonality (3) Projecting lift across similar traffic cohorts over a 12-month period (4) Compounding validated tests to derive a total annualized revenue delta.
The result is a data-backed estimate of incremental revenue that represents the long-term business impact of PDQ’s optimizations, assuming no significant regression or external disruption.
If after three months and applying the cumulative lift methodology, the guaranteed annualized revenue threshold is not met, the Customer may terminate the engagement and receive a full refund or credit of all Subscription Fees paid from the Subscription Start Date through the termination date.
This guarantee is intended to align incentives, promote experimentation, and ensure PDQ delivers real, measurable business value.
