Average order value (AOV)
Average spend per order
Average order value (AOV) is the average amount a customer spends on a single order. You calculate it by dividing total revenue by the number of orders. It shows how much you actually earn from one order and is one of the basic performance metrics for an online store.
How AOV is calculated
The calculation is simple: divide total revenue for a given period by the number of orders in the same period. If you earn a certain amount from two hundred orders in a month, the average order value is that amount divided by two hundred. It makes sense to track it continuously so you can see whether order value is trending the right way.
AOV makes the most sense in combination with other metrics, especially conversion rate and customer acquisition cost. Only together do they show whether the business truly pays off and where there’s room to improve.
Why AOV matters
A higher average order value means you earn more from each order without having to acquire more customers. That matters because attracting a new customer tends to be more expensive than selling more to an existing one. Growing AOV therefore directly improves a store’s profitability.
AOV also affects how much you can afford to invest in advertising. The more you earn per order on average, the higher acquisition cost you can afford and the more flexibly you can plan your marketing.
How to raise AOV
There are several proven ways to get more value out of a single order. The most effective are techniques that offer the customer more value, not just a higher price.
- Upselling: offering a better or larger version of a product.
- Cross-selling: offering complementary products with the purchase.
- Free shipping above a certain order amount.
- Bundles and quantity discounts for larger purchases.
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What is a good average order value?
There’s no universal number; it varies by industry and the price of your range. Instead of comparing yourself to others, track your own trend and aim to raise AOV gradually against your own past while keeping customers happy.
What raises AOV the fastest?
The fastest wins usually come from free shipping above a threshold and offering complementary products in the cart. Customers happily add another item to reach a benefit, which naturally raises the order value.
Is it better to raise AOV or conversion rate?
It pays to work on both at once, because they complement each other. A higher conversion rate brings more orders, while a higher AOV brings more profit from each one. Together they improve the result the most.