AOV is a key pillar for any eCommerce brand. As a strategy that focuses on maximizing the average order value for existing customers, it’s your key to understanding target market behaviour and increasing revenue without needing to acquire a new customer.
This 12-strategy AOV checklist will help you narrow in on the different AOV-increasing approaches available and help you find the best fit for your business.
The formula for calculating AOV is revenue divided by number of orders. AOV is determined using sales per order, not sales per customer. Although one customer may come back multiple times to make a purchase, each order would be factored into AOV separately.
AOV is important because the more each transaction is worth, the more profit you make after covering the cost of each transaction — such as cost of acquisition, card processing fees, and shipping. High AOV means a higher profit-to-cost ratio.