Proven Ways to Increase Average Order Value

“An increase in the average order value for an online retailer bears a strong correlation to an increase in profit,” – Armando Roggio

Online enterprises must sell products to their customers in order to sustain business operations, expand the remit of commerce, and to remain profitable. Every e-commerce operator needs to stay abreast of market trends and enlarge his customer base. Every online visitor is a potential customer for an online business and therefore, such businesses must work to convert every visitor into a shopper. To that end, online businesses must monitor and expand, inter alia, the metric named average order value. The average number of dollars spent by each customer in the course of a single shopping session denotes the average order value. We must note that this metric is crucial for the success of e-commerce operations because it helps online enterprises to understand and assess customer shopping behaviour, analyse purchasing patterns, ensure the continued success of an online brand, and to amplify the customer experience.

Cross selling represents one of the core techniques that can help a business enterprise to enlarge the average order value. This action implies selling additional products to online shoppers in the course of a single shopping session. Businesses can opt to offer products to customers related to the merchandise that is already inside the shopping cart. For instance, a shopper that intends to pay for a pair of running shoes can be offered ankle socks to complement the original product. In addition, shoe cleaners and shoelaces can form part of the cross selling technique because these items can be used by the sports enthusiast. The net effect of such actions culminates in a wider range of products inside the shopping basket and a larger bill of purchase. Some merchants may choose to sweeten the deal for online shoppers by offering a minor discount on the additional items; this provides the shopper an added incentive to complete the transaction successfully. In light of the above, we note that online shopping mechanisms afford the merchant significant scope to practice cross selling techniques.

Businesses may choose to offer free shipping to online customers when the value of the merchandise in their shopping carts exceeds a set amount of dollars. This technique is widely practiced by e-commerce businesses in pursuit of enhancing the average order value. The free shipping offer must be communicated to each individual customer in the course of his or her shopping session in an attempt to incentivise the individual. This creates strong motivation in the shopper to attain, if not exceed, the set amount of dollars. We must note that product-shipping prices represent a significant cost in online shopping and if the merchant agrees to excise the said cost, the customer may feel empowered to invest additional dollars in the purchase of online products. Additionally, free shipping offers can encourage customers to share their shopping experiences with their social media contacts because the empowered customer is at liberty to announce his or her triumphal experience of shopping online. This can have the effect of expanding the customer base of the said online business because such communications can attract more business to the enterprise.

Discounts always work wonders in commerce and these can be leveraged by online businesses to boost their average order value. Modern e-commerce operators, in a bid to encourage customers to increase the quantum of their online shopping, may tweak this concept. For instance, a business can choose to offer customers a flat 20% discount on their final shopping bill when the value of items in the shopping cart exceeds a certain amount. The number of items of merchandise and the value of each item becomes immaterial in such an approach and this should be communicated to the online shopper. We must note that this clearly illuminates an example of a business speaking directly to its customers. The initial buzz generated by such an offer can create a clear upsurge in online sales, enabling the business to steal an edge over its market competitors. An added bonus is manifest in the fact that each customer’s average order value registers an uptick and this helps the enterprise to attain its stated business goals.

Time sensitive offers represent an exacting approach to expand average order value. This technique may be used in conjunction with flash sales to boost the volume of customer dollars earned by an e-commerce business. Most business operators offer their customers a 48-hour window to shop online and avail a range of time sensitive discounts. This technique can ignite the shopping equivalent of a feeding frenzy in online business models. In addition, the fact that we live and operate in an electronically connected world helps to boost online traffic because early bird shoppers may broadcast their experiences through social media platforms. We must note that such techniques remain equally valid for both online and offline shopping models; this approach to selling also helps a business to clear out its inventory of products, thereby creating space for new merchandise and a fresh inventory. In terms of online businesses, time sensitive offers can be broadcast through emails, text messages, in-app messages, and banner advertisements on e-commerce websites. The exciting messages can help to pique shopper curiosity, boost Internet traffic, encourage impulse shoppers, increase average order value, and boost business bottom lines.

The use of social proof in online shopping destinations can create a powerful and pervasive incentive that bears the potential to boost customer intent. A celebrity of no mean repute can be requested to endorse certain products or category of products, thereby creating a powerful visual message for online shoppers. This technique can attract considerable shopping interest and helps to boost the average order value. This technique can also be extended to spotlight customer testimonials regarding a specific product or service. We must note that social proof acts as a powerful sales propellant in cyberspace and must be leveraged to attain the desired business outcomes. Social proof can also highlight the use of transparency in the world of online commerce and thus helps businesses to deepen the connection with customers and business prospects.

In the preceding paragraphs, we have examined some of the methods that are available to online businesses that wish to increase their average order value. We must note that every online business can use these techniques or a combination thereof, to boost sales and to earn customer dollars on a consistent basis. An expanding average order value speaks volumes about the success and future prospects of any online business and these techniques must be pursued ceaselessly by modern online enterprises. That said, businesses must realise that their primary duty lies in establishing and sustaining a flawless rapport with existing customers because this alone can help the business to flourish and establish an outstanding business presence. Customer confidence is quintessential to every business enterprise and must be treated as sacrosanct by every business operator. Impeccable product quality and top-notch service delivery can also help businesses to carve an effective brand identity and win legions of new customers. These actions will inevitably help enterprises to boost average order value and thereby compete successfully in open markets.


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