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Tips To Improve Average Order Value For Your Online Store

By Tracey Heinz

Business owners who step into the digital realm need to make heedful moves so that their business treads on the path leading towards growth. If your online sales reach a plateau with a consistent revenue stream every month, it is evident that your online business isn’t flourishing. While consistency in sales leads to sustainability, similar sale pattern over a prolonged time is indicative that your orders are averaging at a low amount.

The solution to static sales figures on your digital outlet is to get more traction for your store. Though increase in traffic would definitely lead to higher profits, the process of getting more people moving towards your website itself requires some expense, and it can put the business owners at a risk of constantly striking a balance between expenses and revenue.

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You can motivate your customers in buying more of your products or opt for items that come with hefty prices. Alternatively, you can lure customers to do both. But before you think on these lines, it is imperative for you to understand about Average Order Value and ways to improve it.

Understanding Average Order Value

The amount of money each of your customer spends with every single transaction from your store is known as Average Order Value (AOV).

The following formula can help you calculate Average Order Value,

Average Order Value = Total Profit/Total number of orders

To fully understand the concept, let’s consider the following example. If total sales from your store are $1000 and 10 orders have been placed by your customer, then applying the above formula AOV would be (1000/10) $100 per order. This means that your every single customer would spend nearly $100 for each transaction.

To have an in-depth analysis of the shopping experience that you are providing to your customer, you should also be aware of the below-mentioned key metrics.

  • Average Basket Value: This metric is quite similar to AOV and informs the business owners how much products are sold in a single transaction.
  • Customer Lifetime Value: This important metric is very crucial for determining the worth of every single customer during the course of their entire relationship with your business. Lower numbers signal that you should focus more on retaining your customers.

For you to improve Average Order Value, construct a strategy that would help you in convincing your customers to add more items to their cart or purchase expensive products. Following tips will guide you on how you can considerably improve your sales revenue and AOV.

Similar Product Recommendations 


Most of the times, when a customer enters a store, he is consumed by the thought of making a single product purchase. The idea of getting what he wants is so overwhelming that he doesn’t care looking around for objects that can provide him with same or even greater value. Once he gets his desired object, he finalizes his purchase with a small cart. This leads to lower AOV.

Here is where the power of product recommendation steps in. With multiple product recommendations listed on the checkout or product page, it is quite likely that your customer would consider browsing through items that offer similar or more value than the one he is looking to purchase. This in turn would make the purchasing process uncluttered, leading to heavier carts and improved AOV.

Options such as “Customers Also Viewed” or “Similar Products” are a great way to pique your customer’s interest. Recommending slow-moving products can help you sell stocked items.

Mix & Match Recommendations


This approach is quite similar to the one mentioned above. Rather than just putting up popular products for recommendation for your customer, pick items that can be paired well with the product your customer is purchasing. This includes add-ons and other accessories. For instance, if your customer is interested in purchasing boxing gloves from your store, recommending a punching bag can greatly improve his shopping experience.

Cross-selling or up-selling your products significantly improves your AOV. Cross-selling is a practice when you promote complimentary products while up-selling is recommending new versions of the same product.

Minimum Orders & Discounts

Inviting customers to get discounts by spending a particular amount of money can lead to considerable increase your AOV. For instance, every customer who purchases items worth of $100 from your store can get free shipping anywhere in the world.

You can also offer coupon codes and discounts on minimum orders. For example, offering your customers 10% discount for purchasing items worth or more than $100 will lead to minimum order sales. Alternatively, you can give a pair of free boxing gloves on all orders above $150.

To make the incentives more conspicuous, incorporate a promotion bar on top of your page.

Loyalty Programs Work Wonders

Introducing loyalty programs for everyday products that are repeatedly purchased by your customers is also a thoughtful technique to get higher AOV.

For instance, let’s think that your customers purchase soaps or washing detergents from your store. Offering a discount every time your customers buy these particular items would lead to customer retention. You can build long-lasting relationships that would pull back your customers again and again. This in turn would have a positive influence on your store’s AOV.

Beneficial incentives act as a magnet that would attract your customers to your store. According to a study carried out by Stitch Labs, old customers spend 120% times more than new ones every year. Research carried out by 2017 COLLOQUY Loyalty Census suggests that discounts are a major driving force for customers to visit a particular store.

Set-Up Discount Packages Or Bundle Offers


To get your customers interested in purchasing more products from your store, come up with attention-grabbing bundle offers that would cost less than purchasing individual items of the package.

While bundle offers are a great way to improve customer loyalty, they are crucial for increasing the value of the products perceived by the customers.  A bundle offer is the right tool to provide your customer everything that he desires for in a single shopping experience.

For example RDX Sports offers its customers’ different bundle offers such as FL4 Ladies Gloves with Focus Pads, T8 MMA Gloves with Shorts etc. enabling the customers to get an all-in-one solution rather than purchasing everything separately. This is a win-win situation as you can sell multiple items at once and can get satisfied, loyal customers.

To make the shopping experience more fulfilling for your customers, allow your buyers to create their own bundles from a variety of products. Let them choose from different variations of the products or select their add-ons, making the process more value-driven for them.

For instance, your customers can create their own gift pack or first-aid kit. Rather than selling the items separately, invite customers to create their own packages. This is a good way to keep your customers interested in your product offerings while also increasing Average Order Value.

Focus More On Customers Who Are Interested In Your Products

The simplest and cost-effective way to capitalize on your Average Order Value is to pay more attention towards your existing, loyal customers. Since they are already familiar with what you are offering and trust your work ethics, you won’t need to do much to convince them to spend more.

By focusing on clients who are already engaged with you in one way or the other, it is quite convenient to grab their attention for more products. Rather than running on acquisition treadmill, it is best to keep prime objective in mind of providing greater value. The rule of the thumb should be to add more value to customers who are willing to spend more.

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Tags: Retailers

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