Average order value

Average order value, or AOV, is total revenue divided by the number of orders over a period. A store with 50,000 in revenue from 1,000 orders has an AOV of 50.

AOV matters because it decides how much a store can spend to win each customer. If the AOV rises from 40 to 55 while ad costs stay the same, every order becomes more profitable. That is why stores push upsells, bundles and free shipping thresholds.

In RivalSonar, estimated revenue is estimated orders times an AOV of about 1.2 times the store's typical product price. The 1.2 factor reflects the fact that many orders include more than one item or an add-on. It is a simple rule, so stores that sell mostly bundles, or that sell very expensive single items, can differ from the estimate.

Useful checks when you research a competitor:

• the product price most of their best sellers sit at
• any quantity offers or bundles that are pre-selected
• the free shipping threshold, which often sits just above the typical order

Treat any outside AOV figure as an estimate.