Average Order Value (AOV)

Jargon
Written By Landon Howell

Average Order Value (AOV) is a metric that measures the average amount of revenue a startup generates from each customer order.

It is calculated by dividing the total revenue generated by the total number of orders received during a specific period of time.

How to calculate Average Order Value

($) Total Revenue / (#) Orders Placed = ($) Average Order Value

AOV is an important metric for startups because it provides insight into how much revenue each customer generates.

It is also useful for tracking changes in customer behavior and identifying opportunities to increase revenue. For instance, if the startup can increase its AOV, the startup is able to generate more revenue without having to acquire additional customers.

Landon Howell
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