Average Order Value
Average Order Value (AOV) is the average revenue per order — total revenue divided by the number of orders.
What is Average Order Value?
Average Order Value (AOV) is the average revenue per order over a given period. It is calculated as total revenue divided by the number of orders — 500 orders worth $50,000 give an AOV of $100. Note that the basis can vary: some tools compute AOV from net sales while others include shipping and tax, so the definition must match before you compare numbers.
Why does Average Order Value matter?
AOV determines how much each order contributes, and therefore how much you can afford to spend on marketing and fulfilment. Raising AOV spreads your fixed per-order costs over more revenue and improves the ratio between order value and customer acquisition cost. It is usually cheaper to get existing visitors to add more to the cart than to acquire new traffic, so even a small lift in AOV can move the bottom line noticeably.
Common use cases
- Setting a free-shipping threshold just above your current AOV to pull orders upward.
- Measuring the impact of upselling, cross-selling, and product bundles on cart size.
- Using upsell steps and quantity discounts to increase items per order.
- Segmenting AOV by channel or campaign to see which traffic buys the most.
- Comparing AOV against contribution margin so higher order value does not just come from discounts.
Shopify perspective
Shopify reports AOV directly in Analytics under Reports and on the Overview dashboard, so you can track the trend over time with no extra setup. To influence the number, free-shipping thresholds, quantity discounts, and product bundles work well — either through Shopify Functions or an upsell app that offers relevant items in the cart and checkout. Always check whether your reported AOV is before or after discounts and shipping, so the figure stays comparable across periods and channels.