5 Fantastic Ways to Grow the Average Order Value of Your eComm Business!
In the eCommerce business, what matters the most is the amount customers pay at the time of the final checkout process. It determines your average order value. Suppose you have fixed Rs100 for your product but when the customer is going to buy it, they pay only Rs 95 as they might have some coupon or other offers. In this scenario, your revenue will also get impacted. That is why increasing your average order value is essential if you want to grow your business without any hurdles. It is no secret anymore that increasing your average order value is a crucial metric to track for an eCommerce business.
But sellers usually try to hike their overall conversion rates by improving their product quality, delivery speed, and other aspects of online business. Generally, they don’t even consider AOV (Average order value). If you are one of them and have not realized the importance of AOV, you should understand that AOV is critical in raising your overall revenue. Once you learn the tactics to grow this essential part of your business, you won’t have to invest a heavy amount in marketing and paid advertising. This blog will teach you more about average order values and some impeccable ways to grow them efficiently.
What is the Average Order Value?
It is saddening if you are an eCommerce seller unaware of the term Average order value. However, here we are to help you understand it in a better way. The average order value (AOV) is the average amount the customers spend for each purchase. You can measure AOV by dividing the total revenue you generate by the total number of customers’ orders. In such a manner, you will be able to find out the average order value of each product. You must know that the average order value is the essential KPI for sellers as it provides an insight into the customers’ buying behavior, total spending on advertisements, and even product pricing.
Five Proven Ways to Improve Your Average Order Value
Now you must understand what is Aov(average order value) is, but you may not have the understanding to improve it. Here we present five fundamental ways to help you improve your average order value. So without further ado, let’s dig into the solutions.
Identify the Demand of Your Customers
When there is a demand, everything essentially becomes a necessity. For example, if your grocery is running out of stock and you visit a grocery store, you will find that you are coming out with several other items that were not even on your list. So it is an excellent opportunity to increase your average order value by understanding the demand and needs of your customers. As an online seller, you must consider the necessity of your customers.
Understand the need and then come up with an excellent product idea. Apart from that, you must ensure that your products can make a difference in your customer’s life. It will be best if you focus more on your customers’ needs. Once you can pinpoint their demand and need, you will better understand what product you should sell and what tactic you should apply to attract more customers. In the process of identifying the demand of your customers, you can take the help of inventory management software such as eVanik OWS.
Implement the Cross-Selling and Upselling Method
These two are the most terrific way to grow your average order value. First, let’s know about the cross-selling method; in this particular method, you need to add complementary products with the originally purchased product. Suppose a customer buys a camera, then you must add a mike or tripod with it. If the customer feels the requirement, they will buy all three together. Eventually, it will increase your average order value. However, in the upselling method, whenever a customer views any specific product, they can also view some other products lying beneath. It encourages them to buy an expensive product or more than one product at once.
Try to Sell the Products in Combo
To increase your AOV(Average order value), you should offer combo products to your customers. You can create several combos at the lesser value of their individual price. It is another way that can help hike up your AOV in an outstanding manner. Sell the combos of three to four products that customers find helpful for themselves and cost-effective as well. It will help if you offer a combo of products with an all-in-one solution for your customers. For example, you can make a combo of a gas stove, lighter and essential items related to this specific product. Customers can find it more convenient to get all the products in one place, as it also eliminates the need to do more searches and buy every product individually.
Run Limited Period Offer
Several prominent eCommerce platforms such as Amazon, Flipkart, Ajio, and Myntra are using this brainy technology to increase their average order value. They allow the sellers to run a short advertisement period by labeling their products under “Limited Period Offer.” It is considered a practical approach to increasing AOV. You can use this tactic on those customers who have abandoned your cart just because they find the product much more expensive. As a seller, you can target those customers and send them an email by offering the same product at some specific discount. Apart from that, you can showcase several expensive products under the label of a limited period offer at a high discount rate. Believe it or not, this specific tactic can make your customers buy more products instead of just one.
Apply the Minimum Cart Value “Free Shipping” Tactic
It is another helpful tactic that one can use to maximize their overall AOV. Direct can use this tactic to consumer businesses. They can set a minimum cart value and offer their valuable customers free shipping or other attractive offers. For instance, If they sell the maximum products of 250rs, they can limit the cart value to 500rs. To save money on shipping, customers can buy more products instead of just one, and it can ultimately increase your average order value. Whether it is an online business or an offline business, customers around the world love to have different deals or offers.
Hence, these are a few fabulous ways to grow your average order value for your eCommerce business. Above mentioned ways can help you immensely with AOV and make your customers happier.
Monitoring and measuring the average order value regularly is crucial for any eCommerce seller. It can not only improve your overall revenue. Still, it can stimulate your business and marketing decision-making and offer a maximum return on every penny you spend on several advertisements and marketing campaigns. To upsurge your AOV, you must focus on customers already buying from you. You need to boost their requirements and make them purchase more products than those they have already added to the cart. To implement this process successfully, you need to help them discover new relevant products.
So instead of spending a lot on ads and other tactics, you should simply go for the ways mentioned above to increase your average order value and add a golden feather to your online business. If you cannot calculate your AOV or any other financial reports, you can take the help of eVanik OWS as accounting software. It integrates with your system and provides crucial information regarding your online business. You can also use this software for inventory management, payment, shipping, return reconciliation, and accounting.