How to Increase the Average Order Value of Your Shopify Store

Is your store plateauing or are you reaching your limit in terms of sales? You've done research and you've come to the conclusion that the only way to make money is to get more traffic. Getting more traffic is never a bad thing, but it can be expensive, and if you are a small start-up, you might not have that capital available to invest.

Every store owner knows that acquiring more customers or growing your business needs investment, but what about increasing the Average Order Value (AOV) of the clients you already have? There are clever ways of increasing your AOV, and we will cover a few of them in this article. But first, what exactly is the AOV, and how do you calculate yours? It's simple!

The equation looks like this:

Total Revenue Earned / # Orders Placed

Just remember to make sure your total revenue and total number of orders placed are set within the same time-frame! :)

How to Increase Average Order Value

Cross-selling & Product Recommendations

This strategy involves adding product recommendations to your product pages. You can either set these recommendations to be based on popular items, but if you really want to focus on customer retention and increasing your AOV, you should download an app from the Shopify app store and set related products to be visible on qualifying items. This means for example, if you are selling children's toys, you could promote batteries as an up-sell item.

You've been to a grocery store or supermarket recently, haven't you? Have you ever been tempted to buy a chocolate bar, battery pack, or the latest gossip magazine as you reach the checkout cash? Do you think these items are placed there by accident, or that it just naturally occurred in every single supermarket by some strange coincidence? Of course not. That's called up-selling, and nothing is preventing you from doing the same in your online store.

Create Discounts for Larger Orders

Another strategy is to set up a minimum order for a discount percentage. Let's say your online store sells children's toys once again, and the average price of your products is $40 before taxes. A great way to encourage spending is by setting order minimums for discounts such as $50 minimum for a 5% discount, and $100 minimum for a 10% discount. This way your customer has to purchase either two or three products instead of one to take advantage of this great deal.

It may seem insignificant, but when someone is faced with that choice at the point of purchase, they often rationalize the decision of buying extra products for the "savings".

Bundle Pricing & Packages

A major aspect of an enjoyable "User Experience (UX)" is optimizing your site to require the least amount of clicks to get from point A to point B. This means that it's better from clients to get from landing on your site to clicking "confirm purchase" in 5 clicks than it is in 10 clicks. If you notice that your abandoned cart ratio is growing, or your sales are stale or even diminishing, it may be because your UX or UI (User Interface) is poorly designed.

It may also be that customers who are buying more than one product have to make a greater effort and spend more time finding and buying three related products rather than buying a single bundle for the same price. If you sell products that can be bundled, nothing prevents you from creating new items within your Shopify store and bundling your products to save your customer's time!

Improve Customer Service

This may seem like a no-brainer but good customer service is an essential part of your overall success. If you want to focus on up-selling and increasing your AOV, then customer retention should be top-of-mind! Have you ever had a really bad experience ordering a product, or even returning one? Did you go back there afterwards?

To share a personal experience, I once bought some bathroom fixtures on a very popular online home decor store. The fixtures were advertised as "chrome" accessories, and I was extremely disappointed when I received chrome-painted plastic faucets. I hadn't open the box within 14 days since I was not renovating my bathroom yet, and when I tried to return them under the pretense of false advertising, they refused. Needless to say, I will never shop there again.

It's important to remember that people talk, especially in this age of social media. Of course, you have to stand your ground with extreme cases, but take a long look at what your value is, and draft a list of how you can improve your "WOW factors".

Send Marketing Emails

Shopify collects a lot of data for you so you can optimize your marketing. Part of that marketing falls on you. You have all the data, and a mailing list. If you want more repeat business, try sending out newsletters and talk to your client base about promotions, special events, blog posts, or anything that makes your store special.

Sometimes, all people need is a gentle reminder to take action.

Need help optimizing your Shopify store? Contact NOBL today!

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