How to Increase Average Order Value

By Arielle Mullen, Senior Digital Strategist

Last year (2020), we saw a record-setting Black Friday/Cyber Monday, with many U.S. consumers choosing to shop online to avoid crowds amid COVID-19 concerns. According to estimates, consumers spent a whopping $34.4 billion, a 20.7 percent year-over-year (YoY) increase.

The world of ecommerce harbors intense competition. It’s already challenging to capture customer attention, and it will only become more difficult as time goes on. One of the easiest (but often overlooked) methods of increasing the revenue earned by your ecommerce website is to focus on improving AOV and reducing friction points that cause people to drop off during the purchase process.

The earlier you can implement these methods the better, as there is no one-size-fits-all setup, and figuring out what will work best requires testing and time. In this article, we will review about why your average order value (AOV) matters, and which apps, plugins, and tricks can help you to increase AOV, boost customer engagement, drive sales and pull in more revenue.

What is “Average Order Value?”

Average Order Value (AOV) is a critical metric for any retailer. It shows the average worth of each individual order basket. Knowing the average dollar spend of each order placed across your ecommerce store can help you plan more effective marketing and pricing strategies.

Usually, when consumers shop online they’ll buy only what they’re looking for. However, with the strategies and tips we present in this article, you can learn how to deliver a better offering to your customer in order to generate more revenue from each order.

Simply put, instead of trying to win over new customers by driving paid traffic to your site by focusing on increasing your AOV, you can draw more value out of the customers you already have.

Meaning? You can offset customer acquisition costs to reduce your payback period and improve ROI without having to invest heavily in additional marketing.

Boosting Average Order Value (AOV)

Tip #1: Use a Free Shipping Bar to Encourage Additional ‘Adds to Cart’

Everyone loves free shipping, and it’s largely become the norm for ecommerce websites to offer this at a certain price threshold. Depending on the platform you’re using (like Shopify or Weebly), there are a million different plugins & tools to use that will do the heavy lifting for you.

Tip #2: Create a BOGO Campaign

If a BOGO (buy-one-get-one) campaign doesn’t make sense for your margins, consider creating a promotion where purchases of two (or three, four, or however many makes sense for your pricing), get one free. Alternatives of this same tactic include ‘Buy Two Get Free Shipping’ or ‘Buy X and get 50% Off.’ The important thing is to ensure that the promotion you create offers benefits to both the customer and your bottom line.

Tip #3: Look For Opportunities to Cross-Sell and Upsell Products

An ‘upsell’ is “upgrading” a customer to a better, more expensive product, such as a better digital camera with more advanced features than what the customer is eyeing to buy. A ‘cross-sell’, on the other hand, is offering related or complementary items, something in addition to the digital camera, such as a carrying bag, larger memory cards, additional batteries or digital photo printer, etc.

Look at your products and information from past purchases to see if certain items are commonly purchased together. When you have one or more combinations in mind, set up an automation to activate during the purchase process to alert the customer. For example – if you know Product A and Product B are purchased together at a high frequency, the customer should receive a notification during the purchasing process that suggests they snag both.

Pro-Tip: Use bundle upsells to offer a small volume discount on a product you already know your customers enjoy.

With apps like the Product Upsell Shopify, you can add cross-sell or upsell products at the click of a button! Just add the one-click upsell Shopify button to your Shopify website and choose a product to offer in the one-click upsell or cross-sell pop-up window. In addition, the following list of Shopify plugins and apps are 10 of the Best tools to increase average order value. They are helpful and built to boost customer engagement, drive sales and pull in more revenue.

  1. CartHook – One of the best upsell apps for Shopify stores, CartHook allows you to create a customizable single-page checkout, which simplifies the user experience and can improve conversion rates. CartHook also provides your customers a final thank you page, where it also allows you to upsell by showing customers relevant products after they have completed their initial purchase.
  2. Personalizer by LimeSpot – Personalizer by LimeSpot is a top-ranking Shopify app. It has been ranked no.1 in global eCommerce personalization technology. Limespot claims that it can help your store increase the order size by 5% and revenue by 28% on average. You can easily provide in-order store recommendations to your users in order to get more sales and conversions. By highlighting the products your shoppers are most likely to buy, you can surely increase your revenue, conversion, and basket size as well.
  3. ManyChat – sending customers the right message by Personalizing your marketing communications paves the way to successful business-consumer relationships. With ManyChat’s chat automation tools, you can send customized messages and talk to your customers anytime, anyplace, and on their preferred channels, be it Messenger, SMS, or email. You can re-engage with cold customers or aid your customers by sending helpful product follow-ups and more. This level of engagement prompts people to spend more, increasing your store’s AOV.
  4. Privy – more than 18,000 Shopify merchants have given Privy a 5-Star Rating in the Shopify App Store. Privy works by offering pop-up boxes that help reduce cart abandonment issues. It encourages buyers to purchase more items at once by offering options such as free or next-day delivery. Did you know that 58% of consumers add more items to their cart to qualify for free shipping?. You can use Privy to set up pop-up boxes to offer free shipping for orders over a specific amount. For example: offering free shipping on orders over $75 tempts customers to pay for another item rather than shipping.
  5. ReConvert Upsell & Cross – Features included in the app are a reorder button, review integration, and full analytics. Reconvert works by allowing you to optimize your Shopify shop’s “thank you” page and order status page for both upselling and cross-selling. With the drag-and-drop editor, you can make relevant product recommendations that encourage your customers to amend their order post-purchase and add additional products.
  6. Also Bought – This app uses Affinity Analysis to analyze previous purchases and generate product recommendations that customers might also be interested in. They’re then displayed in a product slider that appears when a customer visits a product page. Let’s say that your customer is viewing grilling gloves, for example. The plugin recognizes that people shopping for that item tend to buy certain accessories too. So, the app pulls product data for the most popular accessories and shows it on the product page. This increases your AOV because people are buying more than the single product they’re viewing.
  7. Wishlist Plus – Giving your customers an option to create wish lists is a great way of engagement as it allows customers to save a favorite product and later return to it. Wishlist Plus is an awesome plugin. It is super convenient. It enables customers to “bookmark their favorite products and pick up where they left off when they return.” Also, it even lets customers share these lists with family and friends.
  8. Nudgify – Nudgify’s Shopify app uses social proof combined with pop-up boxes to show how many people have purchased the product the customer is currently viewing. This instills the trust in your shopper that other people are also interested in the product and buying it. Naturally, adding it to their online cart is the right thing to do. Overall, this type of social proof builds more trust with your shopper. More trust equals more sales and a higher chance of earning customer loyalty (according to Nudgify, this can be up to 15% more.)
  9. Smart Bundle Upsell – Smart Bundle Upsell is a fully-supported Shopify upsell app that tracks every item in a user’s cart, alongside their browsing method, to create the most targeted upsell possible. The app combines everything you need in one place: a robust and attractive interface, Cross-sell, Upsell, Bundle offers, Post Purchase Upsell, Smart Dashboard, AI offers, A/B tests, Free Design Templates, Performance Tracking, and Upsell Popup.
  10. Swell Loyalty & Rewards – It is a fact that the majority of online shoppers love loyalty and rewards programs. Approximately 58.7% of internet users worldwide have rated earning rewards and loyalty points as one of the most valued aspects of the retail shopping experience. So offering these types of perks on your e-commerce store is an excellent way to increase first-time purchases as well as customer loyalty. Swell Shopify app allows you to create your own loyalty program using points, referrals, and gift cards as rewards. This can have a huge impact on your Shopify store’s AOV. It’s reported that the order value of a shopper that uses a customer loyalty reward in a purchase is 39% higher than the one of a customer who doesn’t.

Conclusion

Optimizing your ecommerce store for a higher average order value has significant value and can greatly impact your revenues. Every ecommerce brand should track their AOV—regardless of whether you’re running a dropshipping store or selling your own items. Calculating the AOV can help you understand how well your business is performing. Not only can it help you tweak your pricing strategies, but you’ll know how much budget you have to spend when acquiring new loyal customers.

Once you make it easy for shoppers to purchase more than one product, you will soon start to see your AOV increasing. So are you ready to see those sales numbers rise? Start testing some of these methods to see what will work for you.

Remember! Though bundles, selling larger quantities, cart-cross-sells, optimizing shipping threshold, checkout upsells, and even post-purchase upsells are all great ways to boost AOV, you must not try and implement all of them at once. Start with one, and evaluate what works best for both you and your customers.