Ways to Grow the Average Order Value of Your Online Store

Whatever you sell on your online store doesn’t matter; you want your customers to be buying more of it. Increasing your average order value is a fantastic way to boost your sales, but it’s often overlooked. 

When you’re running an ecommerce store, you should know that average order value (AOV) can help you get to know your customers’ buying habits, insights about your marketing campaign performance, and how well your pricing strategy is performing. 

One of the easiest ways to increase revenues for an ecommerce business is to increase the amount customers spend on each order. Knowing how much your customers are spending per order can give you invaluable insights that you can use to boost sales by increasing your AOV.

Let’s find out ways to grow the average order value of your online store.

What is an average order value?

The ecommerce metric Average Order Value (AOV) is the average dollar amount customers spend when they make a purchase from your website. This metric helps online retailers understand customer purchasing behavior.

Let’s look at an example: If your store has a total revenue of $2,000 split between 100 orders, your average order value is $20. This means that, on average, a customer spends $20 for each purchase from your store. If you’re a Shopify customer, you can find this number (along with many other reports) in your Customer reports. 

Also, If you’ve no idea what your AOV is, use this straightforward formula to figure it out. 

Total Revenue ÷ Number of orders = Average Order Value 

Benefits of increasing average order value

Here are some benefits of increasing average order value:

·         Increase revenue and profit: When the average order value rises, you’ll see an increase in revenue and profit. The more you earn per order, the more your business makes altogether.

·         Sell more inventory: This doesn’t apply to dropshippers. However, if you own stock for a brick and mortar store or even an online store, you can sell more of your inventory by executing a proper average order value plan.

·         Cost-effective marketing return: If you spend $20 on marketing and the average order value is only $50, you haven’t earned much after you deduct product costs and taxes. However, as you see a positive change in average order value, your marketing spend becomes more profitable.

Ways to grow average order value of your online store

Now that you have a better idea of what average order value is and how to easily calculate it, let’s talk about how you can increase your average order value.

1. Create a free shipping incentive on minimum order

This is the best and easiest way to increase AOV. Create free shipping on minimum order.  if most of your orders are in the $35 range, you might offer free shipping to orders over $50.  For example; free Shipping on all orders above $50. The goal is to make free shipping feel attainable to the greatest number of customers.

This tactic works because free shipping feels like an added value to your store.

You can also add a notification when customers check out and their purchase doesn’t add up to the free shipping threshold. By having this notification, you’ll be able to help increase average order value. You can easily do this by using apps from the Shopify App Store. 

 2. Provide bundle deals

If you want people to buy more products, pairing up is the best way to opt for. Try creating product bundles that cost less than if the same items were purchased individually. Providing bundle deals attracts people and they end up buying your bundle offer.

For example, your offer might be a buy two and get a free gift or buy three and get a fourth free promotion. If you sell women’s products, your free gift might be a $2 bracelet. If you offer a buy three get a fourth free deal, you need to make sure you price your products in a way that you can afford to cover the costs of the fourth while still making more profit from the bundle deal.

Your customers will appreciate the ease of having ready-made bundles to choose from, as now they don’t have to do the research for building an entire package to complete the set that they’re putting together. Also, buying a bundle is cheaper for customers while still giving you a net positive in revenue.

Additionally, you can also empower your customers to create their own bundles by allowing for custom products or packages that let customers choose which features or add-ons they want in their order.

Shopify apps to create product bundles: If you’re interested in adding product bundles or custom bundles to your store, check out a range of free and paid bundling apps in the Shopify App Store.

3. Upsell or cross-sell complementary products

Upsell or cross-sell are more or less alike to bundling. This technique pushes customers to buy complimentary. Cross-selling and upselling are absolute key to increase your average order value. This technique is deployed on most retailer’s website.

Your upsell needs to appear helpful and genuine. Instead of simply suggesting other popular items from your store, If someone is out to purchase $50-$100 of goods, it’s hard to convince them to purchase another $100 but easy to convince them to add a $20 product that complements their purchase.

Shopify apps for cross-selling and upselling your customers:

Check out Shopify App Store to find the right product recommendation app for your store. Here are a few we recommend:

·         Zipify One Click Upsell. Built for Plus customers, this app boosts Average Order Values with one-click upsell offers.

·         Super Bump. Create targeted, post-purchase promotional offers.

·         CartHook Post Purchase Offers. Add native one-click promotions including upsells and free gifts to your Shopify store.

·         Post Purchase Promotions. Boost revenue with native post-purchase upsells and more.

·         Ultimate Special Offers. Create one-click offer upsells directly in your store checkout.

4. Provide fully staffed live chat support

This is one of the key factors to increase you average order value. Being available through live chat helps customers get their immediate questions answered, which means greater potential for a sale and fewer abandoned items.

Live chat helps your highest-intent buyers to buy. You’ll be chatting with visitors who intentionally came to your site to browse or buy, but who might need specific questions answered to gain the confidence to hit the Buy button.

5. Start a loyalty program

Customer loyalty programs go a long way toward creating strong customer relationships and, well, loyalty. They also help to increase average order values. Loyalty programs are popular because they offer discounts to repeat customers, with the biggest and best discounts reserved for those customers who keep coming back time and again. Each time a customer orders, they can earn points or discounts just for being loyal customers.

It’s important to make sure your loyalty program evolves with consumer preferences.

By encouraging repeat sales, you help create a more massive fan base who will likely order larger quantities of products. They’re also cheaper to advertise to via retargeting, social media, or email marketing. Thus, these preachers help increase average order value.

Conclusion

Make your ecommerce store work better for you by implementing the tips and tactics above to increase average order value. Keep experimenting and creating new campaigns, and soon you’ll find which strategies work best with your customers.

Average order value is that you’re concentrating on visitors who already want to buy. They are Ways to Grow the Average Order Value of Your Online Store

Whatever you sell on your online store doesn’t matter; you want your customers to be buying more of it. Increasing your average order value is a fantastic way to boost your sales, but it’s often overlooked. 

When you’re running an ecommerce store, you should know that average order value (AOV) can help you get to know your customers’ buying habits, insights about your marketing campaign performance, and how well your pricing strategy is performing. 

One of the easiest ways to increase revenues for an ecommerce business is to increase the amount customers spend on each order. Knowing how much your customers are spending per order can give you invaluable insights that you can use to boost sales by increasing your AOV. 

Let’s find out ways to grow the average order value of your online store.