The key benefit of increasing average order value is that you make more money from each transaction. Thus, making your store more profitable.
Often, when a customer shops online, they'll only buy exactly what they're looking for. However, with some of the average order value strategies that we'll share in this article, you'll learn how to present more great products to customers to generate more sales from each order.
What is the Average Order Value?
Average order value (AOV) is the average amount a customer spends when placing an order in your store. This metric helps you understand purchasing behavior and identify opportunities to boost revenue per transaction.
How to Calculate Average Order Value
You can calculate your store's average order value by dividing your store's total revenue by the number of orders taken. This formula is the easiest way to calculate it. Keep in mind that it doesn't take into account marketing costs.
For example, if your store brought in $2,000 from 100 purchases, your AOV would be $20. This means each shopper typically spends around $20 per transaction.
You can monitor this number right inside your Shopify dashboard under Reports > Customers, where you'll also discover additional data about how your shoppers behave.
Understanding Modal vs. Mean for Better Insights
While calculating the average (mean) is helpful, relying only on this number can paint an incomplete picture. Marketing experts recommend looking at three different measurements together:
- Mean: the typical average of all purchases
- Median: the middle value when all orders are arranged in sequence
- Mode: the purchase amount that occurs most frequently
Here's why this matters: Imagine your mean order value sits at $24, but your mode (most common order size) is only $15. A few high-spending customers are pulling your average upward, hiding the fact that most shoppers spend considerably less.
By focusing on the purchase amounts that happen most often, you can create strategies that work for the majority of your customers. If most people spend $15, think about which add-ons or bundles would naturally encourage them to increase their cart to $20 or $25. Small improvements across many orders often deliver better results than chasing occasional big spenders.
Average Order Value Benchmarks by Industry
Understanding how your AOV compares to similar businesses gives you valuable context. Across all industries globally, the typical order value hovers around $145. However, this varies widely depending on what you sell:
- Luxury goods and jewelry often see order values exceeding $300
- Clothing and accessories typically range from $40 to $170
- Beauty and personal care products usually fall between $15 and $90
These benchmarks help you evaluate your performance fairly. A cosmetics brand and a high-end jewelry retailer will naturally have very different "healthy" order sizes.
Beyond industry category, other factors influence spending patterns. With shopping cart abandonment rates averaging around 70%, friction during checkout can undermine even strong order values. Additionally, stores that use highly personalized shopping experiences, like tailored product suggestions and custom bundles, can outperform competitors in both conversion rates and revenue.
Benefits of Increasing Average Order Value
- Increase revenue and profit: When the average order value rises, you'll see an increase in revenue and profit. The more you earn per order, the more your business makes altogether. If you can see a positive change in average order value, you'll be able to reinvest more money into your business' growth and pocket more too.
- Cost-effective marketing return: If you spend $20 on marketing and the average order value is only $50, you haven't earned much after you deduct product costs and taxes. However, as you see a positive change in average order value, your marketing spend becomes more profitable. Thus, why it's crucial to have an average order value strategy in place.
- Sell more inventory: This doesn't apply to dropshippers. However, if you own stock for a brick and mortar store or even an online store, you can sell more of your inventory by executing a proper average order value plan. By making changes to see a boost in AOV, you'll be able to sell more of the products you carry.
10 Ways to Increase Average Order Value
1. Offer a Free Shipping for Orders Above a Certain Amount
The easiest way to increase the average order value is to offer a free shipping threshold. For example, you can offer free shipping on all orders over $75.
Once you've calculated your average order value, add 30% to it. For example, if your average order value is $100, with the 30% increase, it becomes $130. This new number is what you'll set your free shipping threshold at â for example, free shipping on all orders over $130. Aaron Zakowski found that a 30% increase to your average order value worked best as a free shipping threshold.
However, consider using your modal order value instead of the mean. If most of your purchases are around $35, setting your threshold at $50 makes the goal feel achievable for the majority of shoppers. Setting it too high risks losing customers to cart abandonment.
You can also add a notification when customers check out and their purchase doesn't add up to the free shipping threshold. By having this notification, you'll be able to help increase average order value. You can easily do this using apps from the Shopify App Store.
It’s important to note that this practice works better when it’s prominently featured. You can put a banner on your store’s landing page to encourage customers to achieve that threshold when shopping, instead of having it be a surprise when they’re checking out.
Another variation is offering complimentary items when customers reach a certain purchase amount. This creates an extra incentive beyond just avoiding shipping fees.
2. Give Product Discounts
While it seems counterintuitive, providing discounts can help change your average order value. However, when offering discounts, be sure to add a minimum spend. For example, get $10 off when you spend $75 or more.
Some brands also have volume discounts. This is when specific order value brackets result in a particular discount. For example, get $10 off when you spend $75, get $15 off when you spend $100, and get $25 off when you spend $150 or more.
3. Provide Bundle Deals
Providing customers with bundle deals can affect average order value. For example, your offer might be a buy two and get a free gift or buy three and get a fourth free promotion.
Of course, you'll need to ensure you choose free gifts that won't impact your product margins too much. For example, if you sell women's products, your free gift might be a $2 bracelet. If you offer a buy three get a fourth free deal, you need to make sure you price your products in a way that you can afford to cover the costs of the fourth while still making more profit from the bundle deal.
Bundling works particularly well when you package items that create a complete solution. For instance, if you sell camping equipment, grouping a stove with essential accessories makes it convenient for customers to get everything they need in one purchase, eliminating the need for additional research while boosting your order value.
You can also let shoppers build their own bundles by selecting which features or add-ons they want, giving them control while still increasing the total purchase amount.
4. Give a Gift Card
Gift cards are a great way to increase average order value, even when giving a small one away for free. For example, if your retail price is $35 or higher, you can offer a free $5 gift card for a customer to use with their next purchase. This will push customers to return to your store and make a discounted purchase, where you still earn a margin.
However, you need to make sure that your product prices are high enough that your gift card doesn't result in a free purchase for your customer, as that would cause a profit loss. Also, remember to make sure that customers know they can't use the gift card on the current purchase or shipping (if you offer free + shipping on certain products).
Lastly, offering gift cards encourages future purchases, which helps reduce future ad spend. It's a great bonus to give customers when sales are seasonally lower. Don't offer this deal year-round as it can lose its effectiveness over time.
Keep in mind that even if you don't give a free $5 gift card, gift cards still help increase average order value as most don't spend the full card or end up paying much more than their card provides them.
You can offer a gift card to customers directly from the Shopify admin.
5. Give Special Offers to First-Time Shoppers
If you're a relatively new brand, under six months old, most of your customers will be first-time visitors. Offering deals to new visitors can help increase average order value. You can provide this particular audience with a one-time discount when they buy multiples of a popular product or exclusive bundle deals just for people who haven't shopped with you before.
If your customer orders several items and loves what they receive, it'll be even easier to entice them to shop again. They'll already have experienced shopping on your site first hand. Thus, you have a better chance of turning them into repeat customers.
6. Use Cross-selling and Upselling Strategies
A cross-sell is an item that a customer may like that's different from the product they're viewing. For example, if your customer is looking at a dress, you might have a recommended product of a pair of earrings that pair with it.
An excellent idea for cross-selling is to add the products the model is wearing to the recommended products. For example, if the product photo is selling a tank top, you might add the skirt as a cross-sell. Since the customer sees the two together, they'll be more likely to purchase them in combination.
An up-sell is when you encourage customers to buy more expensive items or additions to increase average order value or profit. For example, if you sell pillows, you might upsell a comforter set, a duvet, or other items.
An effective way to upsell products is to sell more of the same product. For example, if you sell essential oils, you would upsell by recommending the same scent and a couple of other popular scents to the customer. The reality is, people are likely to buy more of what they love, especially if it's likely to run out at some point. This works well for beauty products as well.
When suggesting additional items, keep recommendations genuine and helpful, rather than overly sales-focused. Hand-pick products that naturally complement what's in the cart, such as accessories or add-ons. Also, focus on lower-priced additions. If someone is spending $50 to $100, suggesting a $20 complementary item is more effective than pushing another $100 product.
Consider using AI-powered recommendation tools that analyze browsing behavior and past purchases to show shoppers items they're most likely to add. Stores that shift budget from blanket discounts to personalized promotions can see returns up to three times higher.
Check out the Shopify App Store for recommendation apps like Zipify One Click Upsell, Candy Rack, CartHook Upsells, or USO: Ultimate Special Offers to implement these strategies easily.
Another smart, low-risk approach is using post-purchase upsells. These appear right after checkout is complete, so you avoid interrupting the buying process. Tools like ReConvert simplify presenting complementary products, such as a matching serum after someone purchases a moisturizer, once customers have already completed their transaction.
7. Have a Loyalty Program
Having a loyalty program in place can help increase average order value. Each time a customer orders, they can earn points or discounts just for being loyal customers.
The benefit of having a loyalty program is that it helps build brand evangelists, customers who keep coming back to your website to shop. Research shows that 40% of a store's revenue comes from repeat customers, even though they represent only 8% of all visitors. Repeat customers are more likely to buy more from your store than people who are unfamiliar with your brand.
By encouraging repeat sales, you help create a larger fanbase who will likely order larger quantities of products. It’s also cheaper to market to repeat customers via retargeting, social media, or email campaigns, making it more cost efficient than trying to win new customers.
Consider implementing tiered rewards that offer perks like complimentary shipping, early product access, or small gifts for repeat buyers. Just make sure your loyalty programs stay relevantâduring economic uncertainty, it may not make sense to reward spending with overly lavish gifts. Focus on perks that feel valuable without hurting your margins.
8. Offer Time-Sensitive Deals
You can offer a time-sensitive deal to help increase average order value. For example, you might have a 48-hour deal where someone gets a free gift or a special discount when they've ordered a specific quantity of products.
While it might not increase the average order value for a long duration, urgency helps increase conversions. Time-sensitive deals are great for boosting average order value during slower periods. And they're relatively easy to execute. You can promote them on social media or include a banner notification on your website.
9. Show Savings With Bulk Orders
People love saving money. However, when your customers order large quantities, they sometimes feel guilty about it. You can maintain a high average order value from a customer through the display of overall savings. This can prevent abandoned carts or cart modifications, which can lower the amount they planned to buy.
However, if you show customers how much money they're saving per item with each addition, they'll feel like they're scoring a deal. Showing people the monetary savings they get from buying multiple items can help increase average order value, even if it acts as a preventative measure.
10. Create a Game or a Contest
The food industry often creates games or contests to increase average order value. For example, McDonald's has the Monopoly Game, where customers are incentivized to order more frequently and upgrade their meals to get more game pieces. With the game pieces, they have a chance of winning big prizes.
In ecommerce, you can also run contests where customers have a chance to win prizes when they buy often. You can let customers know that if they've made a purchase, they can enter the contest and win one of several prize packs. Then, you can search the Shopify App Store for the contest app that works best for your campaign.
Tracking and Optimizing Your AOV
Monitoring your average order value becomes more powerful when you view it alongside other key metrics. Rather than tracking it alone, examine AOV together with customer acquisition costs, customer lifetime values, and conversion rates. This helps you determine whether increases in order size actually improve profitability.
Within Shopify, you can watch your AOV directly in the Analytics dashboard or through custom reports. Many store owners integrate platforms such as Google Analytics or specialized applications like Lebesgue: AI Marketing & LTV to gain a more detailed understanding of purchase patterns and transaction trends.
To make your AOV improvements actionable:
- Monitor your AOV over consistent time periods (like month over month or quarter over quarter) to identify real progress
- Establish realistic goals, such as growing AOV by 5% to 10% over the next quarter
- Test changes before scalingâtrial adjustments like shipping thresholds, bundles, or post-purchase offers, and use data to confirm whether they lift both AOV and profit margins
By continuously monitoring and testing, you'll move beyond simply chasing bigger carts toward building a healthier revenue model where each order grows in size while contributing sustainably to your bottom line.
Start Increasing Your Average Order Value Today
Calculating your average order value can help you understand how well your store is performing. After you've calculated your average order value, you can try executing some of the strategies in this article to increase it. Whether you create bundled deals or create a free shipping threshold, you'll be on track to seeing higher order volume on your online store.
Remember that the beauty of focusing on AOV is that you're concentrating on visitors who already want to buy. They've come to your site with high intent and may even have items in their carts. Your job is simply to help them discover and purchase more products that match their interests. By prioritizing engagement with customers already making purchases, you encounter fewer obstacles.
So are you ready to see those sales rise? Then, it's time to get started on implementing some new changes.
Average Order Value FAQ
Why Is Calculating Your Average Order Value Important?
Your business’s AOV is a crucial metric because it shows you the average amount of money each customer spends at your store. If your AOV is high, it tells you that tactics like promoting more expensive items or upselling and cross-selling are driving sales.
How Do You Calculate Your Average Order Value?
To figure out your AOV, divide your total revenue in a given time period by how many customers you have who’ve bought something over the same timeframe. Tracking this metric helps you understand what customers are spending on each transaction and what it may take to increase that dollar amount.
How Do You Define Order Value?
This article explains how average order value works, but what about “order value?” Order value is how much a shopper spends in a single purchase including the costs of products and shipping.
Is There Such a Thing as a Good Average Order Value?
Defining a good average order value is tricky, as it depends on your products and the industry in which you operate. For instance, if you work in beauty and personal care, then you’re probably aiming for $15 to $90 per order. On the flip side, luxury and jewelry brands work to surpass the $300 mark. It’s useful to compare to peers in your industry, though it’s far more important to increase your AOV over time and focus on your own profit margins.