## Definition of

## AOV: Average order value

AOV is the average amount of money spent per order in an ecommerce store.

## Detailed Description of

## AOV: Average order value

Average Order Value (AOV) is a key metric used in product management to measure the average amount of money spent by customers on a single order. It is calculated by dividing the total revenue generated from all orders by the total number of orders placed. AOV is an important metric for product managers as it helps them understand how much customers are spending on their products and services, and can be used to inform pricing strategies, promotional campaigns, and product development decisions. A higher AOV indicates that customers are willing to spend more on each order, while a lower AOV suggests that customers may be more price-sensitive or that there may be opportunities to increase customer loyalty through promotions or other incentives.

## Examples of

## AOV: Average order value

1. Average Order Value (AOV): The average amount of money spent per order. It is calculated by dividing the total revenue generated by the number of orders placed. 2. Average Basket Size: The average number of items purchased in each order. It is calculated by dividing the total number of items purchased by the number of orders placed. 3. Average Item Price: The average price of each item purchased in an order. It is calculated by dividing the total revenue generated by the total number of items purchased. 4. Average Shipping Cost: The average cost to ship each order. It is calculated by dividing the total shipping costs incurred by the number of orders placed.