Average Order Value on Shopify: How to Calculate and Raise It

Average order value is the sales from a period divided by the number of orders in that period. Shopify's own figure works from order value after discounts and leaves out shipping, taxes and later adjustments such as returns. This guide covers the formula, why the median often tells you more than the mean, how to split the number so it means something, the three levers that raise it, and the check to run on profit before you celebrate.

How do you calculate average order value?

Divide sales by orders for the same period and the same set of orders.

The detail that matters is what you put on top. If one report uses sales after discounts and another uses the amount charged including shipping and tax, the two AOV figures will differ and neither is wrong. Choose one base, write it down, and keep it. Following the definition shown in your Shopify admin is the easiest choice, because every other report you read will be consistent with it. Our guide to gross sales, net sales and total sales sets out which figure includes what.

Should you use the mean or the median?

Look at both, and plan offers around the median. The mean is what the formula above produces. The median is the middle order when you line them all up by value: half of orders are smaller, half are larger.

They diverge because order values are lopsided. Most orders cluster near the price of one or two popular products, and a few large ones sit far above.

An example with made-up figures: say five orders come in at $20, $30, $40, $50 and $360. The mean is $500 divided by five, or $100. The median is $40. No customer in that set spent anything close to $100, so a free shipping threshold set 'just above the average' at $110 would be out of reach for four of the five.

The mean is right for forecasting revenue, since orders multiplied by mean AOV gives sales. The median is right for understanding what a typical shopper does, which is what you need when setting a threshold. You can get the median from an order export in any spreadsheet.

Why split AOV by channel and customer type?

Because a single store-wide figure blends groups that behave differently, and it can move when only the mix has changed.

• By sales channel. Online store orders, point of sale orders and draft orders for trade buyers have different typical sizes. A handful of wholesale drafts can lift the blended figure in a month when retail shoppers spent less.
• By new and returning customers. Returning customers know your range and often buy differently from first-time buyers: sometimes more, sometimes a quick single-item reorder. Which way it goes in your store decides where an offer should be aimed.

Compare each slice with its own previous period. A rise in store-wide AOV that comes entirely from one large trade order tells you nothing about your product pages.

What actually raises average order value?

Three levers do most of the work, and all three give the shopper a reason to add something they already half wanted.

Thresholds. A reward that unlocks at a cart value, such as free shipping or a gift, pulls orders that sit just below it up to it. Set the threshold a modest step above the median order, not above the mean, so that it is within reach of a typical basket. A threshold nobody can see does little, which is why it belongs in the cart; Marka Cart Drawer shows a tiered rewards bar inside a slide-out cart for this purpose.

Bundles and quantity breaks. Selling the set at a better price than the parts, or the second and third unit at a lower unit price, raises units per order. This suits consumables and products that are naturally used together. Marka Bundles & Upsells covers quantity breaks, fixed bundles, mix and match and frequently bought together.

Add-ons. A small, relevant extra offered at the point of decision: the refill, the case, the care kit. The add-on should cost a fraction of the main item and need no explanation.

Whichever you use, change one thing at a time and give it enough orders to show an effect.

Does a higher AOV always mean more profit?

No. AOV is a revenue measure, and every lever above has a cost that revenue does not show.

• A bundle discount gives away margin on units some customers would have bought at full price.
• Free shipping above a threshold moves the shipping cost onto you, and larger parcels cost more to send.
• A free gift has a cost of goods.

The measure to watch next to AOV is profit per order: what is left of the order after cost of goods, discounts, shipping you paid and payment fees. If AOV rises and profit per order rises with it, the offer is working. If AOV rises and profit per order is flat or lower, you have bought revenue. The steps for working this out are in our guide to calculating net profit on a Shopify store.

How often should you review it?

Monthly is enough for most stores, plus a before-and-after check around any offer you launch.

For the review itself you need sales and orders split by channel, compared with the previous period, with profit alongside. Marka Metrics follows Shopify's sales definitions, breaks sales down by product, city, sales channel or payment method with period comparison, and reports gross profit on its free plan. For the wider picture of what Shopify reports and omits, see our guide to Shopify analytics.

A short checklist

1. Fix one definition of sales for AOV and keep to it.
2. Work out the median order as well as the mean.
3. Split AOV by sales channel and by new versus returning customers.
4. Set thresholds a step above the median, and show them in the cart.
5. Launch one offer at a time and compare before and after.
6. Track profit per order beside AOV, and judge offers on that.

Average order value is easy to raise and easy to misread. Keep it tied to profit per order, and if you want both in one place with Shopify's own definitions, take a look at Marka Metrics.