# What is AOV (average order value)?

> AOV is the average amount a customer spends per order. Get the formula, a worked example with rupees, why it moves your ROAS and four ways to raise it.
- **Author**: Marxx
- **Published**: 2026-11-14
- **Category**: Metrics
- **URL**: https://marxx.ai/library-glossary/aov

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AOV (average order value) is the average amount a customer spends on one order. If you took INR 3,60,000 from 400 orders, your AOV is INR 900. It tells you how much each sale is worth before you decide how much to pay to win it.

## The formula

AOV = total revenue / number of orders

Use the same basis every time. Count revenue with or without GST, and with or without returns, and keep to that choice.

## A worked example

Last month your store took INR 3,60,000 from 400 orders.

- AOV = 3,60,000 / 400 = **INR 900**

Say your cost per purchase on Meta is INR 450. Then your ROAS is revenue per purchase divided by cost per purchase.

| AOV | Cost per purchase | ROAS |
|---|---|---|
| INR 900 | INR 450 | 2.00 |
| INR 1,200 | INR 450 | 2.67 |

Same ads, same cost per purchase. A higher AOV lifts [ROAS](/glossary/roas) from 2.00 to 2.67. That is why many brands work on order value, not only on ad cost. See [CPA](/glossary/cpa) for cost per purchase.

## How to raise AOV

1. **Bundles.** Sell a set of three at a small saving. Say a INR 399 item becomes 3 for INR 999.
2. **A free-delivery line.** "Free delivery above INR 999" nudges a INR 800 basket up.
3. **Add-ons at checkout.** Offer a small related item.
4. **Quantity deals.** "Buy 2, save 10%".

Watch your margin. A discount that lifts AOV from INR 900 to INR 1,200 but cuts margin by half can leave you poorer. Check your [break-even ROAS](/glossary/break-even-roas) after any change.

## AOV is not the whole picture

AOV counts one order. A customer who buys four times a year is worth more than one big order. See the [LTV:CAC ratio](/glossary/ltv-to-cac-ratio) for that view. For a business-wide check that includes all revenue, see [MER](/glossary/mer).

## FAQ

### Is AOV the same as revenue per customer?

No. AOV is revenue per order. Revenue per customer adds up all of a customer's orders.

### Should AOV include GST?

Either way is fine if you stay consistent. Compare AOV with the same basis you use for ad revenue, so ROAS stays fair.

### Is a higher AOV always better?

No. If you reach it with deep discounts, your profit per order can fall. Check margin as well.

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