Revenue, Sales and Profit are always the important figures that a business must care about. However, if you are not just a normal businessman, but an online store owner or an e-commerce seller, you obviously know AOV (Average Order Value) is the key of all the matters that we mentioned before.
As in the previous post ‘E-commerce Optimization #3 – Increase Your Profits And AOV (Average Order Value)’, we already showed you what AOV is and how to increase it in several ways, in this post we are gonna help you win the customers and earn more money for each order. Let’ start!
AOV (Average Order Value) – The important key
First of all, we need to remind you what AOV is.
- What is it? – The average value per order.
- How to calculate it?- AOV = Total Revenue/Number of orders.
Three Steps – Let’s get in.
We will set three steps into the online customer purchasing journey
#Step1: When a customer is searching for their needs
Do not sell the product individually. Let’s bundle it in 2 ways!
- Cross-sell right now: do not wait until after they purchase or add to cart to cross-sale because when they add something to cart and start paying it means they have found what they need and stopped their making decision journey. Cross-sell before that might be easier.
For example: sell just an iPhone 8+ case, let’s sell iPhone 8+ combo including cases, screen protectors, selfie stick,… a bunch of stuff with a lower price than buying them separately. Of course, there should be few options for the customers, as they can pick what they really want: combo, or only the case or screen protectors.
- Up-sell right now: the same reason to explain. We can bundle our products with upselling options.
For example: Do not sell one 8+ case, let’s sell 2 or 3 for different styles that customers and their friends could share.
#Step2: When customers go into their cart
At this time, let’s set a higher free shipping threshold. The shipping threshold should be calculated based on your normal AOV, then you can raise it by an amount between your cheapest product and your lowest shipping fee, finally, show it to your customers when they go to their cart and start checking out.
- The normal AOV: $30
- The cheapest product: $8
- The lowest shipping fee: $5
=> your new free shipping threshold could be $35 because they knew if they pay $4 shipping fee. Why not just pay $3 more to have one more stuff.
At this step, it is better if you do cross-selling and up-selling, recommend customers the cheapest related product or a bigger, larger option so they don’t have to go back and look for one more thing to add. Customers always love free shipping. And if you have the products they need already, they will be not too hesitate to pay just a few more dollars.
#Step3: When the customer starts paying
Using exclusive offer to cross-sell: popup and recommend them to pay $1 extra to get one more thing. What you suppose to give customers for free as a gift, now you can sell it for $1 or even $5, $10. It depends on your products, are they expensive or not. For example, you are selling clothes with a price range between from $20 to $60. $20 you could offer $5 for a basic scarf or $2 for a basic hair-band that fits their chosen products. And this offer is exclusive for their own cart at that moment right before they pay.
Finally, we want to notice you that customers behave differently in different markets such as fashion, technology, homeware,…You need to understand your own customers, try to feel what they could feel by testing your own store, your own purchasing product, then improve it both the look and the experiment. From that, you could build your own steps to increase your AOV based on our suggested steps above.
Thank you for your read, hopefully, this could help you start enhancing your AOV and your profit successfully.