Calculate Average Order Value

What is Average Order Value?

Average Order Value (AOV) is the average amount spent each time a customer places an order on a website or mobile app.

AOV Calculation

• Formula: Total Revenue / Number of Orders
• Example: $10,000 revenue from 100 orders
  • $10,000 / 100 = $100 AOV

Key Points

• Important metric for understanding customer spending habits
• Varies widely by industry and product type
• Can be increased through upselling, cross-selling, and bundling
• Helps in forecasting revenue and setting sales targets
• Influenced by pricing strategy, product mix, and customer segmentation

Why AOV Matters

• Indicates the value of each customer transaction
• Helps evaluate the effectiveness of pricing and marketing strategies
• Guides inventory management and product development

Using AOV

• Compare performance across different time periods
• Segment customers based on their average order value
• Identify opportunities to increase transaction values
• Set goals for improving overall revenue