Why average order value matters and how to increase it Steven P May 19, 2022
Why average order value matters and how to increase it
Why average order value matters and how to increase it

All businesses want to sell more to their customers, regardless of the nature of product or service. However, selling to more customers and selling more to one customer are completely different playing fields. Therefore, it is essential to focus on the value of the orders. In this article, we would like to explain why average order value matters and how to increase it for your business.

What is the average order value?

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Average order value (AOV) refers to tracking the average amount spent each time a customer places an order on a website or on apps. This can be calculated by dividing total sales by the number of orders. AOV is also a key performance metric that online businesses measure to understand their customers’ buying habits. This metric can be tracked for any period of time, but most companies track the monthly average.

Why does the average order value matter?

Understanding average order value will help your business evaluate and review your overall marketing and pricing strategy by providing the metrics you need to measure long-term value. As a standard to evaluate customer behavior, AOV helps businesses set goals and strategies as well as evaluate the effectiveness of those strategies. Boosting this will help increase your direct sales and profits as AOV has a transaction cost associated with each order your customer buys.

Tips for improving average order value (AOV)

Cross-sell and Upselling

Both upselling and cross-selling are useful ways to increase average order value. Since cross-sell recommends products from other categories that your shoppers may have missed, they offer the unique advantage of enhancing the customer experience by expanding buyer awareness. A more satisfying and fulfilling shopping experience boosts shoppers’ trust in your brand and ensures that they’ll consider you for future purchases. This method recommends additional items that help shoppers get all the accessories they need in one place, and they’ll appreciate not having to shop around.

Volume discounts and coupons

You might think that offering discounts is the opposite of increasing average order value because the goal is to make each purchase generate more revenue for your business. However, it is quite the opposite, you will not give a coupon without a certain criteria. You can offer discounts on bulk purchases or offer coupons for future purchases to encourage returning customers.

Free shipping and return policy

Free shipping is the easiest way to increase your AOV and gain an edge over your competitors in the same industry. If the shipping cost is too high, the cart will be abandoned, so free shipping will make customers feel secure about the purchase without having to pay additional costs, so the average order value will be higher. Besides, the return policy will help customers have a comfortable experience so that they can rest assured on their next purchases.

Donations for non-profit organization

Businesses can completely set standards such as donating to a nonprofit for a minimum purchase. This both encourages customers to buy from you because more and more people are interested in social activities, on the other hand, when you pay attention to social organizations, you will receive expectations and more trust from authorities and consumers. This will also help increase average order value.


The most economical and effective way to increase average order value is to focus on your most loyal, existing customers, so focus on customer-centric strategies.

Contact us to get support to help your business increase AOV.

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