Formula
AOV = Revenue ÷ OrdersAOV formula
Average order value divides order revenue by completed orders. $75,000 from 1,000 orders gives an AOV of $75.
Define revenue consistently
Decide whether revenue includes taxes, shipping income, discounts and refunds. Comparing a gross AOV with a net AOV can create a false trend.
AOV is not customer value
AOV describes one order, not a customer relationship. Use purchase frequency, retention and gross margin to connect AOV with customer lifetime value.
Assumptions
- Refunds and taxes are treated consistently in revenue.
Sources and methodology
CalcMotive publishes the formula and assumptions so you can decide whether the estimate fits your use case. See our methodology standards.