Purchase Frequency
Quick definition
Purchase frequency is the average number of orders per customer in a period, calculated as orders divided by unique customers.
Formula
Purchase Frequency = Number of Orders ÷ Unique Customers
Formula variables
- Number of Orders
- All orders in the period.
- Unique Customers
- The number of different customers who placed those orders.
Worked example
- Orders in the year
- 9,000
- Unique customers
- 6,000
9,000 ÷ 6,000
Result: 1.5
The average customer placed 1.5 orders in the year. The figures are illustrative.
How to interpret it
Purchase frequency shows how often customers come back to buy. Together with average order value it indicates the revenue a customer generates per period.
It is an average and includes first-time buyers, so it should be read together with the repeat purchase rate.
When it is useful
- Estimating customer value per period with order value.
- Comparing product categories with different buying cycles.
- Setting the timing of reminders and replenishment emails.
Limitations
- Depends on the period chosen.
- Includes customers who bought once, which lowers the average.
- Does not show order value.
Common mistakes
- Comparing periods of different length.
- Confusing it with repeat purchase rate.
- Counting items instead of orders.