AOV stands for Average Order Value, and it’s a key e-commerce and product metric that shows how much, on average, customers spend per order.

AOV helps you understand customer purchasing behavior — how much value you're getting per transaction. It’s a powerful way to assess:

• How effective your pricing strategies are
• Whether customers are buying more than one item
• The impact of upselling or bundling tactics
• How your AOV compares across different segments or channels

$$ AOV = Total Revenue / Number of Orders $$

Example:

• If your revenue over a month is $10,000 from 250 orders →

  AOV = $10,000 / 250 = $40

Why it matters:

• A higher AOV can indicate strong monetization.
• Helps decide where to invest (e.g. should you boost traffic or focus on increasing basket size).
• Useful for forecasting, especially when combined with other metrics like CAC and LTV.

Tips to increase AOV:

• Offer product bundles or cross-sells
• Use free shipping thresholds
• Promote higher-tier versions (upselling)
• Highlight time-limited discounts for bigger baskets