How to calculate average order value (AOV) step by step
Step-by-step guide on how to calculate AOV, why it matters, and strategies to increase it for higher profitability.
Average order value (AOV) is one of the most important KPIs for e-commerce. It reveals how much customers spend per transaction, helping you understand purchasing behavior and profitability. Here’s how to calculate it step by step.
Step 1: Gather data
Collect total revenue and number of orders for the chosen period (day, month, quarter).
Takeaway: Pull numbers directly from Shopify, WooCommerce, or GA4 for accuracy.
Step 2: Apply the formula
AOV = Total revenue ÷ Number of orders. Example: $10,000 revenue ÷ 200 orders = $50 AOV.
Takeaway: Keep the period consistent when comparing AOV trends.
Step 3: Interpret the result
AOV shows how much value each order brings. A higher AOV means greater efficiency per customer.
Takeaway: Rising AOV often signals effective upselling or improved product mix.
Step 4: Strategies to increase AOV
Offer free shipping above a threshold
Create product bundles
Add post-purchase upsells
Run loyalty or points programs
Takeaway: Even a small lift in AOV can boost total revenue significantly.
Step 5: Monitor over time
Track monthly or quarterly to ensure changes are working. Compare against benchmarks in your niche.
Takeaway: Continuous monitoring ensures sustainable profitability.
Conclusion: Calculating AOV is simple, but the insights are powerful. Improving it even slightly can transform your bottom line.
👉 Want to track AOV without spreadsheets? Try Peasy and see live AOV insights for your store.
