Your average order value is dead simple: net revenue for a period divided by total orders in that same period.
That's it.
You can calculate this for new customers separately from returning customers. And honestly? You should be doing exactly that.
Where do you find this stuff? Shopify's got it. TripleWhale's got it. Hell, most decent analytics platforms will serve this up on a silver platter.
The real question isn't where to find it—it's whether you're actually paying attention to it.
Why Should You Give a Damn About AOV?
AOV measures how much each customer spends when they actually pull the trigger and order.
Your revenue? It's just orders times AOV.
Revenue = Orders × AOV
Seems obvious, right? But here's where it gets interesting.
When your revenue tanks (and it will), you need to know why. Is it because you're getting fewer orders? Or is each customer just spending less per order?
You can't fix what you can't diagnose.
And trust me, the solution for "not enough orders" is completely different from the solution for "customers aren't spending enough per order."
AOV Behavior Patterns
Unlike your order volume—which can crater overnight if Facebook decides to hate your ads—AOV tends to stay pretty damn stable.
And that's actually good news.
It means when your AOV does start moving around, you should probably pay attention. Because something real is happening.
New Customers vs. Returning Customers: They're Not the Same Animal
Returning customer AOV? Rock solid.
These people know what they want, they know what they're willing to spend, and they're not easily swayed by your latest "amazing offer."
New customer AOV? That's where things get spicy.
New customers are guinea pigs for your acquisition experiments. You're testing different bundles, different offers, different landing pages.
Their AOV is going to bounce around because you're making it bounce around.
Here's the kicker: that's exactly what should be happening.
If your new customer AOV isn't showing some variance, you're probably not testing enough acquisition offers. And if you're not testing acquisition offers, you're leaving money on the table.
Your returning customers have already figured out your value prop. Your new customers? They're still deciding.
The smart play? Track these separately. Always.
Because when you lump them together, you're mixing signal with noise. And good luck making smart decisions with that mess.
Long-Term AOV Strategy
Here's where most ecommerce brands get it backwards.
They obsess over getting more customers while completely ignoring the money they're leaving on the table with existing orders.
Every customer who's already decided to buy from you is a revenue opportunity you're probably wasting.
Think about it: they've already overcome the biggest hurdle. They trust you enough to pull out their credit card. They're literally in buying mode.
And you're just... letting them buy one thing?
Upsells work. Bundles work. Cross-sells work. There are many pricing tactics to increase AOV.
The question isn't whether these tactics work—it's whether you're actually using them.
Each person who purchases from you should be spending a little bit more money. Not through manipulation or sleazy tactics, but through genuine value.
You can see different behaviors and patterns when you split new customer AOV versus returning customer AOV. And those patterns will tell you exactly where your opportunities are.
Your Product Catalog Determines Everything
This is where brand context matters more than generic advice.
Got a simple catalog? Your AOV won't have much variance. There's not much room for it to move around.
Selling apparel with tons of SKUs? Your AOV can swing pretty dramatically based on what you're promoting and how.
Here's what this looks like in practice:
Say you sell clothes and you run a 30% off promotion. Your normal AOV is $85.
People might load up their carts because hey, everything's on sale. Suddenly they're buying 3 items instead of 1. Even with the discount, your AOV jumps to $120.
But if you're selling a single product—let's say a $50 supplement where there's no reason to buy more than one bottle?
That same 30% discount drops your AOV from $50 to $35. You're literally making less per order.
The promotion strategy that works for one business model can destroy another.
Returning customers will generally stay consistent. You might see a bump during Black Friday when people channel stuff—buying a bunch at once because the discount is too good to pass up.
But new customers? They're completely dependent on what acquisition offers you're running.
And having an understanding of your catalog and your brand helps you set realistic expectations.
Is that AOV variance normal for what you're doing? Or is something actually broken?
Most brands never ask this question. They just panic when numbers move.
Practical AOV Monitoring
Most brands are monitoring AOV completely wrong.
They're checking it once a month in some dashboard, going "looks fine," and moving on with their lives.
That's not monitoring. That's just looking at numbers.
Real AOV monitoring means understanding what normal fluctuation looks like for your business. Because every business has its own rhythm.
A 5% AOV swing might be catastrophic for a single-product brand but completely normal for a fashion retailer running seasonal promotions.
The question isn't "did my AOV change?" It's "should I be worried about this change?"
Red Flags You Can't Ignore
Here's when you need to actually pay attention:
Sudden AOV drops with no corresponding promotion
Something's broken. Maybe your upsells stopped working. Maybe your bundles aren't displaying. Maybe your checkout flow is screwed up.
New customer AOV trending consistently downward
Your acquisition quality is declining. You're attracting cheaper customers or your offers are training people to expect discounts.
Returning customer AOV starting to decline
This is the big one. These customers know your value prop and they're spending less anyway. That's a product or pricing problem, not a marketing problem.
AOV variance that doesn't match your promotional calendar
If you're seeing big swings when you're not running anything special, dig deeper.
Using AOV Data for Strategic Decisions
When your AOV is stable but revenue is down, you know you have an order volume problem. Fix your traffic or your conversion rate.
When orders are steady but revenue is declining, you've got an AOV problem. Look at your product mix, your bundles, your upsells.
The data is telling you exactly where to focus your energy.
Most ecommerce brands are shooting in the dark, trying random tactics and hoping something works. Smart brands let their AOV data guide their strategy.
Because at the end of the day, revenue is just orders times AOV. And if you're not optimizing both sides of that equation, you're leaving money on the table.
Every single day.
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