Average order value (AOV)

Average order value is the typical amount of money a customer spends in a single transaction. It is one of the three basic levers of e-commerce revenue, alongside the number of customers and how often they buy, and is tracked at the store, category, or channel level to see where spend per order is rising or falling.

It is calculated as total revenue ÷ number of orders over a chosen period. Unlike gross merchandise value, which is the total value of goods sold before deductions, AOV is a per-order average and is sensitive to outliers — a handful of unusually large orders can pull it up even if typical order size hasn't changed, so it's often reviewed alongside the median order value. Tactics aimed at increasing AOV include bundling, free-shipping thresholds, and cross-sell or upsell prompts at checkout.

AOV matters because raising it is often cheaper than acquiring new customers, and it feeds directly into customer lifetime value models. A common pitfall is optimizing AOV in isolation: aggressive upsell tactics can raise order value while increasing cart abandonment rate or hurting repeat purchase behavior, so it should be read alongside conversion and retention metrics rather than as a standalone success measure.