Average order value

What a typical order is worth. One of three levers on revenue.

What it means

Average order value is total revenue divided by the number of orders in a period.

Why it matters

Revenue is orders times average order value. Raising the second is often easier than raising the first, and it costs nothing in acquisition.

What it looks like in practice

The levers: bundling, upselling at the point of purchase, minimum order thresholds for free delivery, and simply raising prices.\n\nTrack it by channel — the same product often sells at a different average through different routes.

What to watch out for

Raising it by discouraging small orders, which can lose more customers than it gains value.

Where to get proper advice

Your own figures. No external source knows your business.