Home -> How to Multiply Your Average Order Value (AOV)

# How to Multiply Your Average Order Value (AOV)

Brent Peterson July 5, 2022

Your store’s average order value (AOV) represents how much the average customer spends per order. Increasing AOV is a way for businesses to boost profits without raising marketing and customer acquisition costs.

In a nutshell, a higher AOV means that you’ll earn more money from the number of customers you currently have.

To calculate your AOV, just divide your total revenue by the total number of orders.

AOV = Total revenue / Total number of orders

If your AOV is lower than you expected, you’re not alone; the majority of online sellers earn less than \$100 per order! However, there are some simple things you can do to encourage your customers to stretch their budget a little more and increase your AOV.

## 1. Offer free shipping for orders above a certain price threshold

Nobody likes to pay shipping fees, and this definitely shows when analyzing purchasing decisions. The majority of customers would rather spend more money to add another product to their order instead of paying a smaller shipping fee.

You can easily install a plugin to alert shoppers when their orders are getting close to the minimum spending threshold. People will likely add another product to their cart to achieve free shipping before heading to checkout.

Another option is to offer discounts for orders that exceed a certain price threshold. For example, you could offer a \$5 coupon for orders over \$50, a \$10 coupon for orders over \$100, and so on. Some companies further entice customers with a free gift if they spend more than a specific amount.

## 2. Cross-sell relevant products during checkout

According to InvestopediaCross-selling occurs when “customers are enticed to buy items related or complementary to what they plan to purchase.” For example, if someone adds a formal suit jacket to their cart, further product recommendations might include matching pants or a button-down shirt.

The main issue that companies face when trying to cross-sell often comes down to discerning what other products each customer could be interested in. Before your eCommerce store can recommend highly relevant items to your audience, you first need to collect and understand all of your customer data

## 3. Provide multiple payment options

Allowing customers to pay for more expensive orders in payment installments instead of all at once can increase your AOV. It can also give you more opportunities to stay connected with those buyers in the future. Payment plans are great for customers who want or need something right away, but can’t pay the full price at that moment.

Offering other payment options like PayPal, Apple Pay, or Google Wallet can give customers additional peace of mind and encourage them to spend more at your store. These digital payment platforms make transactions quick and easy. They also reduce the chances of consumers’ information being compromised.

## 4. Create loyalty programs to encourage repeat purchases

If you want to increase AOV, one of your main priorities is to make sure that your current customer base feels appreciated and connected to your brand. A loyalty program that gives repeat customers points or discounts for every order can help you boost AOV and consumer trust over time.

Along with offering discounts or points to loyal customers, you can show your appreciation by sending free gifts for their birthdays, giving them early access to sales, or giving them exclusive sneak peeks into next season’s new products. Showing your repeat customers that their business is highly appreciated will greatly increase the chances of them becoming loyal to your brand and recommending your store to others!

## 5. Offer discounts for bundles and bulk orders

Product bundles are convenient for customers because they combine everything a consumer needs for a specific occasion or activity in one simple purchase. For instance, a beginner yoga set may include a stability ball, a yoga mat, resistance bands, and a subscription to virtual fitness classes. Consider your own brand and common customer purchases to find items that are frequently bought together, and then combine them into a bundle at a slight discount.

If your business can handle bulk orders, only offer the bulk discount for specific products. If you sell tee shirts, for example, you could offer discounts on each item after the customer adds a certain amount to their cart:

• 1 to 9 shirts = \$10 per shirt
• 10 to 49 shirts = \$9 per shirt
• 50 to 99 shirts = \$8 per shirt

This is an easy way to encourage bulk buyers to spend more to save more.

## More Resources

Looking for other ways to improve your online business? Take a look at our other blog posts or reach out to one of our web development experts today!