3 Tips to Help Increase Average Order Value

As an e-commerce seller, sales are your goal. But what if your average sales are on the low side? Clearly there’s a market for your products, but without growing revenue you may find yourself on a sales plateau.

That’s where bumping up your average order value becomes important. To calculate your average order value, divide your e-commerce site’s total revenue by the number of orders. For example, if your monthly revenue is $1,000 and you filled 100 orders, the average order value for the month is $10. Tracking your average order value can give you a good picture of where you might be falling behind your projections as well as with the competition.

Encourage your customers to check out with larger carts with these 3 tips.

• Add product recommendations and complementary products to your site. Often a suggestion of other products is all it takes to spur an add-on purchase to the original order. For example, if you sell scrapbooking supplies and most of your customers order blank books, include a line such as, “Customers who purchased our 12-inch book also frequently bought the 3-Sheet Sticker Pack” on the product listing or the checkout page. Also effective: A prominent “Add to Cart” button strategically placed next to the suggested item makes it easy for shoppers to bump up their orders without the extra step of backtracking to the product listing.
• Determine minimum orders for special extras, and create package deals. Customers love a deal, so create opportunities for them to take advantage of extras like free shipping or discounts by instituting minimum order amounts. For example, offer free shipping for orders over $25, or an automatic 10% off all orders over $50. Better yet, combine products at a discount. As an example, if you sell cell phone accessories, bundle a popular protective phone cover with an extra charger and car adapter. Market it as a on-the-go deal for that particular phone model; point out that the items sell separately for $100, but you’re offering them together for just $90.
• Reward loyalty. For consumable products in particular, a loyalty program can strengthen relationships with your customers in addition to increasing average order values. Offer points for every purchase, with a freebie after a certain number of points have been reached. While giving away freebies may not sound like a typical way to increase revenue, studies have shown that loyal customers make up almost three-quarters of sales. Give customers a reason to return to your e-commerce store, and they probably will.

The Bottom Line
Sometimes shoppers need a little push in order to add to their carts. By creating simple and compelling ways to increase their order totals, your e-commerce site could start seeing bigger order average values – and profits!