The 3 Things To Know About Average Order Value As An E-Commerce Brand

If you run an e-commerce store, you know there’s a lot to keep track of. One important thing to understand is the Average Order Value, or AOV for short. AOV is basically the average amount of money each customer spends when they buy something from your store.

Knowing your AOV gives you a clear picture of how much your customers are spending. This can help you set your prices right and plan your sales better. And when you know your AOV, you can work on increasing it. In this article, we will go over the essentials to know about your AOV.

3 Things To Know About Average Order Value As An E-Commerce Brand

1 – Calculating the AOV

Calculating Average Order Value might seem tricky, but it’s actually quite straightforward. To find your AOV, you take your total revenue and divide it by the number of orders. For example, if your store made $1000 from 50 orders, your AOV would be $20. This means, on average, customers spent $20 each time they placed an order.

Getting this calculation right is really essential. It helps you understand how much money you are making from each sale. When you know this number, you can make better decisions about pricing, offers, and marketing.

It’s good to keep a regular check on your AOV over time just as you would your inventory or expenses like your 3PL logistics provider. Some stores might calculate it every day, while others might do it weekly or monthly. Regularly checking your AOV helps you spot trends, like if people are spending more or less over time. This way, you can quickly make changes if you need to and keep your store on the right track.

2 – How AOV impact revenue

When customers spend more on each order, your store makes more money. It’s pretty straightforward. Higher AOV equals higher profits. That’s because even if the number of sales stays the same, more money is coming in.

The key to translating this into more revenue is to increase the conversion rate. The conversion rate is the percentage of visitors to your store who actually make a purchase. So, if your AOV is high and your conversion rate is also high, that’s great news for your revenue.

It means a lot of people are buying from your store, and they are spending a good amount of money each time they do.

3 – Use data and analytics

Using the data you collect from your customers helps you see how they behave and what they like to buy. You can get a clearer picture of your customer’s purchasing patterns by looking at what products are popular and how often people are buying, for instance. 

This information is gold when you want to boost your Average Order Value (AOV). By understanding your customers better, you can find opportunities to encourage them to spend more. You can use this info to create bundles or suggest products, encouraging customers to add more to their carts.


Understanding your Average Order Value (AOV) is pivotal for e-commerce success. AOV represents the average spending per customer, guiding pricing strategies and sales planning. Regularly monitor AOV, aiming to increase it for higher profits by optimizing conversion rates. Leverage customer data to shape strategies and drive increased spending.

Our Readers Also Love

Apps For Startup