Which of the following is the correct formula for AOV?
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Correct answer: revenue / transactions.
Why this is the answer
Average Order Value (AOV) is a key metric that measures the average dollar amount spent each time a customer places an order. The correct formula is total revenue divided by the number of transactions. This calculation provides insight into how much customers are spending per purchase, which can inform strategies for increasing revenue, such as upselling or cross-selling. Incorrect options: "Revenue / cost" calculates profit margin, not AOV. "Transactions / clicks" is not a standard business metric and doesn't represent AOV. "Cost / action" is related to Customer Acquisition Cost (CAC) or cost per lead, not AOV.
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