Average order value — AOV

The average amount a customer spends each time they place an order.

What it means

Average order value, or AOV, is the average amount a customer spends each time they place an order. Along with the number of orders, it is one of the two main levers that drive an online store's revenue.

How it works

AOV = total revenue ÷ number of orders

Use the same period and source for both numbers, such as your store dashboard or GA4. Decide whether you include discounts, taxes and delivery charges, and stay consistent so you can compare months fairly.

Common ways to raise AOV:

Bundles: group related products at a slightly better price.
Free-delivery thresholds: offer free delivery above a set amount, a little higher than your current AOV.
Upsells: suggest a better version of what the customer is already buying.
Cross-sells: recommend items that go well together, like "frequently bought together".

A simple example

A Surat saree shop's online store earns ₹3,00,000 in revenue from 200 orders in October.

AOV = ₹3,00,000 ÷ 200 = ₹1,500

The owner then offers free delivery on orders above ₹2,000 and suggests a matching blouse piece on every saree page. In November, with a similar number of orders, AOV rises to ₹1,800. More revenue, without spending extra to find new buyers.

Why it matters

Every order costs money to win through ads and discounts. If each order is bigger, every rupee spent on marketing works harder, improving ROAS and ROI. AOV also helps with budgets: if you know your AOV and profit margin, you can work out how much you can afford to spend to win an order.

Beginner tips

Track AOV alongside conversion rate, since pushing one too hard can hurt the other.
Look at AOV by channel, as Instagram buyers may spend differently from Google shoppers.
Make offers genuinely useful, not pushy.
Common mistake: forgetting that a few very large orders can make the average look higher than a typical order really is.