marketing
AOV (Average Order Value)
Average revenue per order or transaction. A key e-commerce and retail metric.
Definition
Average Order Value (AOV) is total revenue divided by number of orders in a period. It's a core e-commerce metric because it determines how much revenue each transaction produces. Raising AOV is one of the highest-ROI moves in e-commerce: it doesn't increase CAC, doesn't increase shipping cost per order materially, drops mostly to gross margin. Levers: upsell at checkout, bundle products, raise free-shipping threshold, premium product tiers. A 15% lift in AOV often delivers more profit than a 15% lift in traffic.
In your business
- →Test free-shipping threshold raises - the math usually works in your favor
- →Build checkout upsells and bundles - cheap to implement, real lift in AOV
- →Track AOV trend monthly - declining AOV is an early warning of discount-driven sales