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Increase Average Order Value: 20 Ways to Make More Sales

How much do your customers spend when they buy something from your website? You can find out very easily. The Average Order Value (AOV) of your store shows how much each transaction costs on average, and it is directly related to how much money you make and how much you sell. By understanding it, you can figure out how well your store is doing financially and use that information to make better business decisions about how much you spend on ads, how much you charge for products, how you treat your customers, and more. In this article, we'll show you how to raise your average order value so that each order brings in more money.  

Average Order Value

  Average Order Value   Your store's average order value is equal to your total sales divided by the number of orders. This simple equation will tell you how much each customer spends on average when they order something from your website. The average order value is a Key Performance Indicator (KPI), and it is usually measured along with other important KPIs like the conversion rate of an eCommerce store and the customer lifetime value. Each of these metrics is important to track on its own, but when put together, they give a big-picture view of how a store is doing overall. Most eCommerce stores get to their average order value by following these two steps:  
  • Step 1: Measure the average order value 
  • Step 2: Improve it
  Even though these steps are simplified, they do show how e-commerce store owners deal with the average order value. In the next section, you'll learn more about how to do each step.  

How to Calculate Your Average Order Value?

    Use the formula below to figure out how much an average order costs. Average order value = your store’s revenue / your store’s orders. For example, if you've made $10,000 this year and have had 200 orders, the average order value is $50. This means that, on average, you'll make $50 in sales every time a customer successfully checks out their shopping cart. Your store's sales and order count should be easy to find on the dashboard of your eCommerce platform or, if you have Google Analytics connected to your store, in Google Analytics. When you figure out the average order value for your store, it's important to remember that it's based on the sales per order, not just the sales per customer. If a customer buys twice from your website, both orders are taken into account when you figure out the average order value. It's also important to know that the average order value doesn't tell you how much profit you make, but how much money you make on average per order. This is an important distinction to make because you will need to subtract your expenses and costs from your average order value to get a full picture of how much money you make on average per order. Check your average order value often so you can catch any changes that might have affected it sooner than you would have if you weren't checking your average order value often. Your average order value can be affected by any changes you make to your website, such as prices, shipping costs, shipping times, return policies, and how to get around your store.  

How to Increase Average Order Value?

 

1. Bundling products

  Source: Dollar Shave Club   If you sell more than one thing in your online store, this is a way to get your average order value to go up. When you sell two or more products together at a price that is higher than the price of just one product but lower than if the customer bought them separately, the customer will think the deal is worth more and will spend more than they might have otherwise. To use this strategy in your online store, group together products that customers often buy together or products that work well together. You can also give your customers the option of putting together their own bundles by letting them choose from a list of add-ons that you provide.  

2. Upselling

    When a customer is ready to check out or has put an item in their shopping cart, suggest that they upgrade to a more expensive version of the item that has more features. For example, McDonald's is well-known for asking customers if they want to "supersize" their meals as a way to get them to buy more. The customer will pay more for a supersized meal, but they will get more food, which is where they can see the value in the upsell. To use this strategy in your own online store, first make sure you have products to upsell, and then make sure you tell your customers about them! Most of the time, people who visit your website won't look at your higher-value products, but if you suggest one of them, they'll think about it.  

3. Low inventory notifications

  Source: Nudgify   One way to increase the average order value is through pricing and marketing. One way to do this is to let people know when you have low stock. When there aren't many of something left, discounts can help sell them. This helps you sell out of a product you sell, which is good for the books, and it also lets you make more per order. You can draw attention to low stock with badges on product pages or a pop-up at checkout that shows products that are "running out fast." People are more likely to buy things they weren't planning to buy when they think there aren't many of them left. So, you'll be able to raise the average amount of money.  

4. Price anchoring

    With price anchoring, you put your target price (which, in this case, would be something close to the average order value you're trying to reach) between a much cheaper product that doesn't offer as much value and a much more expensive product that doesn't offer much more value. The goal here is to make the average order value product seem reasonable and well-priced while making the other options seem not valuable enough or too expensive. Most of your visitors will choose the product with the average order value, which is what you want them to do. This method works best for digital products, but it can also be used for physical products. It also works well when you group products together because the group of products can be used as a way to show that the prices are worth it. To use this strategy in your online store, make a set of three different kinds of products: low-value, average order value, and high-value. Place these products (or bundles of products) next to each other so your customers can see how they work together. Then, explain the differences between each one and why the average order value product is the best value.  

5. Cross-selling

    This is another method for increasing the average order value that is often suggested and, again, one that works well for most businesses. The goal of this strategy is to get your customers to buy more products and increase the total value of their order by suggesting related products before they check out. So, the goal of upselling is to sell a more expensive version of the same product (like supersizing a meal), while the goal of cross-selling is to sell the customer another product that goes well with the one they're already buying. Using McDonald's as an example again, one of its most well-known ways to cross-sell is to ask customers if they'd like fries with their meal. To do this on your own site, look for products or groups of products that go well together and suggest them to your customers as they are buying. Cross-selling is when an online store suggests other products that are similar to the one you're looking at or that other customers have also bought. You may see this on the product page of most online stores. Use cross-selling strategies on product pages and during the checkout process so you don't miss a chance to tell your customers about similar products. Here are some ways you can tell your audience about cross-sells:  
  • “Complete the Look” 
  • “Customers Also Bought” 
  • “You May Also Like” 
  • “Products Similar To…” 
  Cross-sells work best when they are related to what the customer was already buying, so try to make your suggestions as specific as possible.  

6. Make a customer loyalty program

  Source: Dunkin Donuts   About 75% of customers prefer brands that give them something back. Most of the time, repeat customers spend more money on each order than new customers. Once you've earned a customer's trust, they're likely to keep coming back. A customer loyalty program can give customers a reason to shop more often and buy more things. Not only will those conversion rates go up, but customers will leave with new products they'll love. Using an app from the Shopify App Store, online stores can easily set up a loyalty program. You can use notifications or pop-ups to let customers know about new sales and increase sales. Overall, loyalty programs are a great way to get more qualified traffic and raise the average order value.  

7. Financing

  Offering to finance for expensive items is another way to get people to spend more money on your website. This is a good strategy if your store sells expensive items like furniture, electronics, or art. It probably won't work for stores that sell cheaper items, though. By offering to finance, you take the pressure off of customers to pay the bill all at once. By breaking it up into smaller, more manageable chunks that customers can pay off over time, you spread out the order value and make it more doable. This makes it easier for customers to add more items to their orders and makes it more likely that they will.  

8. Highlight best-sellers

  Source: Argento Neue   You can use a pop-up form to highlight your best-selling items when a customer is ready to check out. There are a few ways to do this: you can show them your top three best-sellers of all time, the top three best-selling products that people bought with what they ordered, or more of the same product they're buying in different colors or styles. To add a sense of scarcity, this pop-up should have a badge that says "low stock" next to products. When you show customers popular items, you can make more money because you already know that those items sell. Once they've put your best-selling items in their cart, you could show them volume discounts so they don't get sticker shock when they see how much their order costs. When online businesses show off their best-selling items, they will make more money.  

9. Minimum amounts for free shipping

  Source: www.shipbob.com   This is another method that most businesses use to raise the average order value because it works so well. Most online stores use this strategy, as you'll probably see because it works well to increase order values and makes customers happy to have a free shipping option. To use this strategy for your own online store, first, figure out your free shipping threshold, and then make it clear to visitors what their minimum purchase must be to get free shipping. Most e-commerce stores have a banner at the top of their site, either right above or below the main menu, that tells customers how much they need to spend to get free shipping. The checkout basket is another good place to let customers know. There, it's helpful to have a dynamic piece of copy that tells customers how far they are from free shipping and changes as they add or remove items from their cart. Small details like "You're $13 away from getting free shipping on your order!" really help customers understand how much they need to spend to get free shipping. The exact amount of your free shipping for the minimum order is very important, so be sure to figure it out carefully. Make it so that your customers have to buy at least two or three products to qualify. If it's easy to reach, there's not much point in doing it. But keep in mind that most customers won't even try to reach it if it's too high. It's all about finding the right balance between increasing the order value, covering your shipping costs, and making the customer happy. As a second tip, some companies have different shipping minimums depending on whether the orders are going to be sent within the country or abroad. For example, the free shipping threshold for orders within the U.S. might be $85 and the free shipping threshold for orders outside the U.S. might be $150. This is helpful for businesses where international shipping costs are higher and a higher order value is needed to cover those costs. You could also offer free shipping to make people more likely to buy from your store in general.  

10. Personalize the experience

  Personalizing the shopping experience is a way for an online store to increase the average amount spent per customer and lower the cost of getting a new customer. You can do this by adding a section to your site that shows customers what they've bought from you in the past. If a customer wasn't sure if they wanted to buy something, seeing it again as they look around might make them decide to buy. Depending on the size and popularity of your store, you might also be able to suggest products based on what people have bought in the past. For example, if a regular customer of your store always shops the "floral collection" on your website, putting new items in that collection on your homepage using an algorithm can help them buy more products in the style they like. You can also send a customer a follow-up email with their order after they check out. In that email, you can include a section with discounted versions of products they looked at and could add to their order. Once a customer pulls out a credit card, it's easier to get them to spend more. When you show products that customers want, your sales will go up. The more personalized the experience, the more likely it is that you'll increase the average order size in your e-commerce store.  

11. Discounts

  Source: Walmart   Even though it might seem counterintuitive, offering discounts on products bought can still help you make more money. By lowering the price of your products, you get customers to buy more so they can spend what they were going to spend anyway. This makes them feel like they got a good deal and still brings in revenue and profits for you. You can try out these different types of discounts on your store to raise the average order value:  
  • Volume Discounts: Your customers will save more money the more they buy, which is a great way to get them to buy more. Create different levels of discounts that customers can get based on how much they buy. For example, if a customer spends $50, they can get 10% off their order, 15% off if they spend $75, and 20% off if they spend $100. Adjust the tiers to match what your customers want and how much discount you can afford without hurting your profit margins. 
  • Time-Sensitive Discounts: These kinds of discounts are great for giving customers a sense of urgency and scarcity, which makes them buy faster than they might have if they hadn't seen the discount. It can also make customers who were only going to buy one product buy a couple or a few more products instead, increasing the total value of their order. 
  • Discounts for First-Time Customers: This is a great way to get new customers to try your store without giving discounts to everyone. This can be a good strategy for businesses that can't give all of their customers a discount or that want to build trust with their new customers. 
  • Coupons: This is another kind of discount you can offer, and you can tell people about it on social media, in transactional emails, or in your email newsletter.
 

12. Sell products that can be restocked

  Every week, you go to a store and buy a number of things. Which store do you think it is? The supermarket. We buy so much food because once we eat it, we can't get it back. So, people keep coming back every week to buy more stuff. The same goes for your online business. If you want to make the most money, sell more, and have a good average order value, you should do two things: sell products that can be restocked and be the only place that sells that product. Not only will it help you get more customers, but it will also help you keep the ones you already have.  

13. Donations

    Giving away some of the money you make from sales can get people to spend more money on your site. When customers can give to a charity or a cause they care about, they are more likely to feel comfortable buying more. Think about how you can use this in your own business model and what kind(s) of charities are relevant to your niche. Give your customers the chance to help their community or a cause that's important to them just by shopping at your store.  

14. Show how customers can save

  Source: Natura Market   You might have a promotion on the top banner of your website that shows savings based on the average order value. "15% off orders over $150, 20% off orders over $200, and 25% off orders over $300," for example. So, customers will know exactly how much money they're saving, and you'll be able to hit your important metrics. When they go to check out, you can show the dollar amount to show how much money they saved. Your customers will love the savings, and it can also help you get new customers. Figure out how to set prices so that you can have a high conversion rate and still make money. Think carefully about how much you need to spend to make a good profit.  

15. Flexible return policies

  If you have a flexible return policy that lets customers send back products that don't work for them without having to pay extra shipping fees, they'll be more likely to buy more without worrying about being punished later. People like to shop this way, and Generation Z is the most likely to say they plan to return more than 75% of the things they buy online. Generation X and Baby Boomers expect to get back less than 50%, while Millennials expect to get back 50%. (Source) This is how people shop now, and if your return policy doesn't work with that, they might not buy anything from your site at all.  

16. Display a group of products

  Source: Target.com   Putting an image or video of multiple products together on a product page or social media post can help increase your average order value and other key metrics. You can make more money by posting a makeup tutorial on YouTube with links to all of the products you use. This is also good for getting people to visit a website. On a product page, you could also show more than one piece of clothing. In their product photo, a woman might be wearing a top, pants, shoes, and jewelry, for example. By adding a "Shop the look" section to the product page, you can sell everything the person is wearing so that people can buy everything and make the outfit themselves. Don't think that everyone can put together an outfit the same way. You can make more money if you show customers every item and have a button that adds the whole outfit to the shopping cart.  

17. Gift cards

  Offer a gift card when a customer spends more than a certain amount. This will get them to spend more money in your store. There are many good things about this strategy:  
  • The bonus gift card will be appreciated by your customers. 
  • The average order value will go up. 
  • Customers with gift cards are likely to come back to your store to buy something else.
  Figure out how much of a gift card you can offer your customers and how much they will have to spend before they can get it. Set the minimum spend around the amount you want the average order to be, but also think about how much your customers will be willing to spend.  

18. Add services

  Source: Holt Renfrew   Thinking about your e-commerce store as more than just a place to sell physical goods can also help you increase the average order value and customer lifetime value. For example, let's say you sell treadmills online. Some people hate putting things together, so you could offer installation as an extra service. If your business is too small to offer services in person, you can also offer them virtually. If you own a clothing store, for example, you could offer services like personal shopping and styling. If you own an auto parts store, you might help people who are trying to fix their own cars by giving them advice. Depending on your niche and qualifications, you can always offer a service to your customers that will help you make more money since services are usually priced much higher than an average product (with a few exceptions, like treadmills).  

19. Gamification

  Source: Culturion   Use tools for gamification to get people to buy or spend more. Customers might buy more products or spend more money if you have fun games like "spin-to-win" coupons or contests and sweepstakes. Check out Sumo or ViralSweep to add gamification to your online store.  

20. Effortless browsing

  The longer someone stays on your site, the more likely it is that they will buy more things. Keep them interested by making it easy and fun for them to look around your site. This can be done by having a clean and easy-to-navigate user interface, clear calls to action on your homepage and product pages, relevant product recommendations, and links between pages so that customers can go deeper into your site. 60% of users prefer on-page navigation to search, so don't make your customers search for what they want. Also, give them suggestions and recommendations they weren't even looking for, so they don't even have to search to find new things.  

Conclusion

  If you didn't know what the average order value was before you started reading this article, we hope you do now. As a store owner, keeping track of data like your average order value can be the difference between making good business decisions and not. Now that you know how to calculate your average order value and use optimization strategies to increase it, you'll be able to make more data-driven decisions for your business that will hopefully lead to better results.
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  1. Cool. I spent a long time looking for relevant content and found that your article gave me new ideas, which is very helpful for my research. I think my thesis can be completed more smoothly. Thank you.

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