Customers and pricing
AOV (average order value)
Revenue divided by the number of orders.
Last reviewedWhat does AOV (average order value) mean?
Average order value is revenue divided by the number of orders in a period. Online retailers split revenue into visitors × conversion rate × AOV.
Where does it come up in case interview prep?
- Unit economics in any businessLesson in How industries work: the toolkit
- Industry primers: retail, consumer goods, banking, telecomLesson in Business basics for non-business learners
- How e-commerce and marketplaces make moneyLesson in E-commerce, marketplaces, and quick commerce
- Unit economics and subscription businessesLesson
- How internet platforms, marketplaces, and digital ads workLesson in Internet platforms, marketplaces, and digital advertising
Related terms
- ARPU (average revenue per user)Revenue divided by the average number of users.
- TAM, SAM and SOMTotal market, the part you can serve, and the part you can win.
- Market shareOur sales as a share of total market sales.
- Relative market shareOur share divided by the largest competitor's share.
- Penetration rateThe share of potential customers who already use the product.
- Share of walletOur share of what one customer spends in the category.
- CAC (customer acquisition cost)What it costs, on average, to win one new customer.
- CLV (customer lifetime value)The profit a customer is expected to bring over the whole relationship.