Posted on November 27, 2015 by admin
As far as e-commerce profitability is concerned, you can increase the frequency of purchasing, or increase average order value. According to bigcommerce.com, average order value can be described as “the average dollar amount spent per order over a certain period of time. This high-level metric is calculated by dividing the total revenue generated by the number of orders taken.”
Although average order value cannot give you an exact amount that you will gain, it does give you an idea of approximations of what you can expect to produce in terms of revenue.
Here are five great ways to increase average order value by 36%:
1. Consider Bundling Products
A creative way of enticing consumers to purchase more than one related item would be to bundle products together, such as a beauty makeup starter pack which could include foundation, blush, mascara, eyeliner and lipstick for a combined price that offers a savings over purchasing items separately.
2. Provide Free Shipping
It isn’t feasible for companies to front the cost of shipping when consumers are only purchasing a single item, however, by establishing a free shipping threshold, providing free shipping is possible and providing an incentive, like free shipping, raises average order values.
3. Establish A Loyalty Program
When it comes to retaining consumers and increasing average order values, establishing a loyalty program is one of the ways to achieve these goals. A loyalty program is particularly beneficial when it is tied to products which are regularly consumed by customers, such as office supplies. When consumers are gifted with loyalty points toward future purchases, this provides an added incentive for repeat business, as well as upping average order value.
4. Offer BOGO
Who would pass up the opportunity to take something that was being offered for free? Probably some, but definitely not all. A great way to get consumers excited over a purchase, and to boost order value is to offer a buy one get one (BOGO) free/half-price.
5. Offer Different Payment Options
Consumer hesitation to purchase is likely to be higher when confronted with higher priced items, but by offering different payment options, such as a flexible payment plan, or $0 down for the first six months can be a solution to increasing AOV.
All of these marketing tactics work and once implemented can increase average order value by 30% or more.