AOV

AOV stands for average order value. It is the total revenue your store took over a period, divided by the number of orders placed in that same period. If your Shopify dashboard shows an AOV of $62, it means a typical order that month was worth $62 to you before costs, shipping and discounts are unpicked.

AOV is not a measure of how much a customer is worth over time, and it is not a measure of how often people buy. The term people most often confuse it with is LTV, which totals what one customer spends across every order they ever place. AOV looks at one order; LTV looks at one person.

Divide revenue by order count for the same window. The honest version uses net revenue: after discount codes and refunds, excluding shipping charges and tax, since none of that is product money you keep. The flattering version uses gross revenue with shipping and tax included and refunds ignored, which can lift the figure noticeably on a store with free-shipping thresholds. Pick one, write it down, and compare like with like month to month. Shopify's default reports may not match your spreadsheet.

Conversion Rate tells you what share of visitors ordered; AOV tells you what those orders were worth. Multiply the two by sessions and you get revenue. LTV extends AOV across a customer's whole history. Contribution Margin takes an order's value and strips out product and fulfilment cost, so it says what the order actually earned you.