This section introduces the meaning and structure of the term "average customer spending," an indicator closely related to sales.

What is the Average Spend per Customer?

The average spend per customer is the amount of money paid by a single customer for a single transaction.

The average price per customer is the sum of multiple transactions, divided by the number of transactions.

Factors that make up the average spend per customer

The average spend per customer is composed of the following two KPIs

(1) Average unit price per product (= average product price)

(2) Average number of items purchased per transaction (=average number of items purchased)

In other words, the average customer unit price can be rephrased as "a numerical value a store gets by calculating the average of how many products are sold and how many items are sold in one transaction."

Indicators Affecting Average Customer Spending

Sales are made up of "number of purchases" and "average spend per customer," and these two indicators are important indicators that determine the increase or decrease in sales.

If the average customer unit price increases, the number of purchases will increase, and if it remains the same, sales will also increase.

On the other hand, if the average spends per customer decreases, sales may decrease even if the number of purchases increases.

In this sense, the average spend per customer has a close relationship with the KPIs that makeup sales.

We hope that provides insight and thank you for reading!