What is average order value (AOV)?
Short answer: AOV is the average amount a customer spends in a single order. AOV = total revenue ÷ number of orders. Because it feeds profit per order, raising AOV directly increases how much you can afford to pay for a click.
AOV is one of the three levers behind break-even CPC, and it is often the easiest to move without touching your ad account. A higher AOV means each order carries more profit, which means each click is worth more, which means you can win more auctions.
How to raise AOV
- Bundles — package complementary products at a slight discount.
- Free-shipping thresholds — “spend $X for free shipping” nudges basket size up.
- Upsells and cross-sells — offer the upgrade or add-on at checkout.
Watch margin while you do it: a discount that lifts AOV but guts margin can leave your break-even CPC unchanged. Test the combined effect in the break-even CPC calculator.
FAQ
Is AOV the same as revenue per customer?
No — AOV is per order. A customer who buys three times has one AOV but three orders.
Does AOV affect LTV?
Yes. Higher AOV with steady purchase frequency raises lifetime value — see the LTV:CAC ratio explained.