Average Selling Price vs Average Order Value
Average Selling Price (ASP) and Average Order Value (AOV) are similar but distinct metrics that measure different aspects of a business's sales performance. ASP focuses on the average price of individual products or services sold, calculated by dividing total revenue by the number of units sold. AOV, on the other hand, measures the average total spent per transaction or order, calculated by dividing total revenue by the number of orders, regardless of how many items each order contains.
A software company should use ASP when analyzing pricing strategy for specific products, such as determining if premium versions are gaining traction or if discounting is affecting overall product value perception. Meanwhile, AOV would be more appropriate when the company wants to measure the effectiveness of cross-selling or upselling strategies, as it reveals whether customers are adding more items to their shopping carts. For example, if the software company notices their AOV increasing while ASP remains stable, it suggests customers are purchasing more products per order rather than spending more on individual products.
Average Selling Price
Average Order Value
What is it?
Average Selling Price (ASP) measures the average price at which a product or service is sold over a defined period of time. It can be calculated for a single product or service, a group of products, a sales channel, or an entire business. ASP is commonly used to compare performance across businesses, segments, or channels and serves as a strong indicator of what customers are willing to pay for similar products or services.
Average Order Value (AOV) measures the average amount of revenue generated per order over a defined period of time. It is calculated by dividing total revenue by the total number of orders placed during that period. AOV can be tracked over any time frame—daily, weekly, monthly, or over the lifetime of an e-commerce business—and is a key indicator of purchasing behaviour.
Who is it for?
Categories
Formula
Example
A luxury watch manufacturer sells 20 watches at $3,000 and 5 watches at $7,500 in a month, generating $97,500 in revenue across 25 units. The ASP is: $97,500 / 25 = $3,900 By comparison, a high-volume watch manufacturer sells 2,500 watches at $50 and 7,500 watches at $30, generating $350,000 in revenue across 10,000 units, resulting in an ASP of $35.
From November 1 to November 30, Company ABC generated $45,000 in revenue from 450 orders. For this customer, the average order value in November is $100 per order.
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Published and updated dates
Date created: Oct 12, 2022
Latest update: Jan 26, 2026
Date created: Oct 12, 2022
Latest update: Jan 26, 2026