What Is AOV (Average Order Value)? Formula, Examples and How to Raise It
AOV (Average Order Value) is the average amount of money a customer spends each time they place an order, calculated as total revenue divided by the number of orders over a period. It tells you how much a single transaction is worth, before repeat purchases are counted.
The formula is simple: AOV = total revenue ÷ number of orders. If a Shopify store took $12,000 across 200 orders last month, its AOV is $60. Use the same date range for both numbers, and decide up front whether revenue includes shipping, tax and discounts, because different dashboards treat them differently and your AOV will shift depending on the choice. Pick one definition and stick to it so month-to-month comparisons mean something.
AOV is not the same as LTV. AOV measures one order; LTV (see what-is-ltv-for-ecommerce) measures everything a customer spends across their relationship with you. A store with a $40 AOV and customers who reorder five times can be healthier than one with a $90 AOV and almost no repeat buyers. AOV is also an average, so a handful of very large orders can hide the fact that most customers spend far less. Looking at the median and the spread alongside the average is more honest.
AOV matters in advertising because it caps what you can pay to win an order. If your AOV is $50 and your gross margin on that order is $20, you cannot profitably spend $30 on ads to acquire that customer on the first purchase, unless you expect repeat orders to make up the difference. That is why AOV feeds directly into ROAS targets and CAC limits (see what-is-roas-vs-cac). Common levers for raising it are bundles, free-shipping thresholds, quantity discounts, upsells at checkout and cross-sells on the product page. Each of these has a cost, whether margin, shipping subsidy or added friction, so measure the effect on conversion rate as well as on AOV.
Why it matters
Infinall AI turns a product URL into research, strategy, ad copy and creative that land in an Approval Queue for you to review before export, so the numbers that shape that work are yours to supply: Infinall does not connect to your store and calculate AOV for you. Knowing your AOV tells you which offer to lead with. A bundle or free-shipping-threshold angle makes sense to test in copy when your AOV is low relative to your acquisition cost; a single hero product may be fine when it is high. Infinall can draft those angles as image ads and carousels, and you edit or approve them before anything is exported. It does not buy media or manage live ad spend, so whether a given AOV supports your bid and budget decisions stays a judgement you make in your ad platform.
Related terms
Frequently asked questions
How do you calculate average order value?
Divide total revenue by the number of orders for the same period. For example, $12,000 from 200 orders gives an AOV of $60. Decide in advance whether revenue includes shipping, tax and discounts, and use the same definition every time so trends stay comparable.
What is a good AOV?
There is no universal good number, because it depends on your margins, product category and acquisition cost. A useful AOV is one where the gross profit on an average order comfortably exceeds what it costs you to get that order. Compare your AOV against your own margin and CAC rather than against another store's figure.