AOV (Average Order Value)
Definition
AOV is total revenue divided by the number of orders in a period. Raising it improves acquisition economics immediately because it increases the value of traffic already paid for.
AOV is often the fastest lever available to an e-commerce business under CAC pressure, because bundling, thresholds and post-purchase upsell can move it within weeks — whereas reducing CAC usually takes a quarter.
Watch it alongside conversion rate, since the two frequently trade off. A free-shipping threshold that raises AOV while suppressing conversion can leave total revenue lower, so judge changes on revenue per session rather than on AOV alone.
AOV = Total revenue ÷ Number of orders
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