Average Order Value: How to Measure & Increase It
AOV is the easiest metric to move — and every dollar of increase flows straight to your bottom line.
Jakob Sperber
Director
Strategy
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Average order value (AOV) is the single easiest lever most ecommerce brands ignore. Every dollar you add to AOV flows straight to your bottom line — no extra ad spend, no extra fulfilment cost, no extra customer acquisition needed.
This guide covers exactly how to calculate AOV properly, what good looks like by category, and the eight tactics that consistently lift it.
What Is Average Order Value?
AOV = Total Revenue / Total Number of Orders
If your store did $50,000 in revenue from 625 orders last month, your AOV is $80. That number becomes powerful when you break it down by channel, product, and customer type.
Why AOV Matters More Than You Think
AOV sits at the heart of your unit economics:
Higher AOV = more CM2 per order. A $10 AOV increase at 60% margin adds $6 of CM2 to every order.
Higher AOV = more room for CAC. You can outbid competitors and still maintain healthy margins. Understanding your customer acquisition cost is critical.
Higher AOV = faster payback.
AOV increases are nearly free. Doubling traffic means doubling ad spend. Increasing AOV 15-20% often costs nothing beyond configuration changes.
How to Calculate AOV Properly
By Channel
Google Shopping AOV vs Meta AOV vs email AOV — calculate each separately. Different channels deliver different contribution margins.
By Product or Category
If you sell $30 consumables and $200 hardware, a blended $85 AOV tells you nothing.
By Customer Type
Returning customers almost always have higher AOV. Segment new vs returning for realistic targets.
By Time Period
Track weekly and monthly. Look for seasonal trends and the impact of promotions.
AOV Benchmarks by Category
Fashion: $80–$120
Beauty/skincare: $50–$80
Supplements: $60–$100
Home: $120–$250
Pet: $55–$90
Food/bev DTC: $50–$85
8 Tactics That Increase AOV
1. Free Shipping Threshold
Set 15-20% above current AOV. Display prominently with a progress bar in cart.
2. Product Bundles
Complementary bundles, starter kits, best-sellers. Price at 10-15% discount vs individual.
3. Tiered Pricing
Buy 1 full price, buy 2 save 10%, buy 3 save 15%. Works best for consumables.
4. Post-Purchase Upsells
One-click offer after payment, before thank-you page. 5-15% take rate typical. The difference between upsells and cross-sells matters — make it a natural addition.
5. Cart Page Cross-Sells
Show 2-3 complementary products. One-click add. Can lift AOV 5-10%.
6. Minimum Order for Gift/Bonus
"Spend $100 and receive a free travel-size [product]." High perceived value, low cost.
7. Subscription at Slight Discount
10-15% off subscribe-and-save. Make it easy to skip/pause/cancel. For consumables, make subscription the default selection.
8. Gift with Purchase
Limited-time exclusive item above a spend threshold. Creates urgency and exclusivity.
AOV vs Traffic
Doubling traffic means doubling ad spend. Profit stays flat. Increasing AOV 20% at same traffic = 20% more revenue flowing almost entirely to bottom line.
AOV and Unit Economics
Before (AOV $80): COGS $32, CM1 $48, shipping $10, CM2 $38.
After (AOV $90): COGS $36, CM1 $54, shipping $10, CM2 $44.
$10 AOV increase = $6 more contribution margin per order. Across 2,000 orders/month = $12,000 extra margin — without spending an extra cent on ads.
Getting Started
Set a free shipping threshold 15-20% above current AOV.
Add cart page cross-sells for top sellers.
Measure over 2-4 weeks, then layer on bundles and post-purchase upsells. The compounding effect of stacking multiple AOV tactics is where the real gains happen.
