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AOV - Average Order Value

AOV (Average Order Value) is the average order value in your online store - how much a customer buys on average per order. It is one of the most important metrics to track and optimize.

What is AOV?

Average Order Value is calculated by dividing your total revenue by the number of orders in a given period:

AOV = Total revenue / Number of orders

If you've made $100,000 on 200 orders in a month, your AOV is $500. This tells you how much a typical customer buys per visit.

Why is AOV important?

AOV is crucial to the profitability of your online store because

  • Direct impact on revenue: An increase in AOV increases your revenue without needing more customers.
  • Better ROAS: Higher order value means you can pay more per click in advertising and still be profitable.
  • Lower relative shipping costs: The shipping cost per order doesn't change significantly as order value increases.
  • Easier to increase than traffic: It's often easier and cheaper to increase AOV with existing customers than to acquire new ones.

Strategies to increase AOV

Cross-selling and upselling

  • Related products: Show products that complement what the customer is looking at (e.g. socks to shoes).
  • Upsell step: Offer a more expensive or better version of the selected product.
  • Bundling: Sell products as packages for an overall discount.

Shipping limits

  • Free shipping over a limit: "Free shipping on purchases over 499 kr." Motivates customers to add more items.
  • Progress bar: Show the customer how close they are to free shipping.

Volume discounts and incentives

  • Volume discount: "Buy 3, pay for 2" increases the number of items per order.
  • Next purchase discount code: Encourage return visits and larger baskets.

AOV in context

AOV should always be seen in context with other metrics:

  • Conversion rate: A high AOV is meaningless if the conversion rate drops drastically.
  • CLV (Customer Lifetime Value): AOV per order multiplied by recurrence rate gives a picture of overall customer value.
  • CAC (Customer Acquisition Cost): Your AOV should be high enough to justify the cost of acquiring the customer.

AOV in Shoporama

You can track your AOV in Shoporama's statistics module. To increase it, you can use features such as related products (cross-selling), upsell steps, volume discounts and shipping limits - all available directly in Shoporama's admin.

We know online marketing in Shoporama

We've been working with online marketing ourselves for decades. As the only shop system in the country, we have spoken multiple times at conferences such as Marketingcamp, SEOday, Shopcamp, Digital Marketing, E-commerce Manager, Ecommerce Day, Web Analytics Wednesday and many more.

See the full dictionary