Use this free AOV calculator to quickly determine the average value of the transactions processed through your business, helping you gain insights into customer spending behavior and evaluate the effectiveness of your pricing strategies and marketing efforts.

AOV Formula:

Average Order Value 🟰 Total Revenue ➗ Number of Orders

What is AOV, Anyway?

Average Order Value (AOV) is a commonly used key performance indicator (KPI) in e-commerce and retail that measures the average amount of money each customer spends per transaction. To calculate AOV, you divide the total revenue by the number of orders.

Example

Company A

• Total revenue in a month: $100,000
• Number of orders in a month: 1,000
• AOV = $100,000 / 1,000 orders = $100

Company B

• Total revenue in a month: $200,000
• Number of orders in a month: 1,500
• AOV = $200,000 / 1,500 orders = $133.33

As you can see, Company B has a higher AOV than Company A. This means that, on average, Company B’s customers are spending more money per order. This could be due to a number of factors, such as:

• Company B sells higher-priced products.
• Company B offers free shipping on orders over a certain amount.
• Company B has a loyalty program that rewards customers for spending more money.
• Company B’s website is more user-friendly and makes it easier for customers to find and purchase the products they want.

TL;DR: Average Order Value (AOV) is the average amount of money a customer spends on a single order. It is a key metric for e-commerce businesses, as it can help them track the performance of their marketing campaigns, product pricing, and overall customer satisfaction.