Average Order Value (AOV) is the average amount a customer spends per transaction. It’s calculated by dividing total revenue by the number of orders. AOV helps assess customer spending patterns and is used to improve upselling, pricing, and bundling strategies to boost revenue without acquiring more customers.
Frequently Asked Questions
Q1. How often should AOV be tracked?
A1. Weekly or monthly is ideal, especially during seasonal campaigns or after pricing changes.
Q2. Does AOV differ by device?
A2. Yes, desktop users often place higher-value orders than mobile users due to ease of browsing.
Q3. How does free shipping affect AOV?
A3. Offering free shipping above a threshold encourages customers to add more items to qualify.
Q4. Can AOV decline even if sales increase?
A4. Yes, if you’re selling more low-priced items, your AOV may drop despite higher order volume.
