How can you increase your Magento Store Average Order Value (AOV)?
Every Magento e-commerce site owner’s dream is to see at the end of the month an empty or almost empty warehouse by successfully selling their products, just like the physical store owners. A lot of magento websites spend a lot of money on marketing, but sometimes seems that the used strategy is failing. Because our calling is to help you and your store win the battle against the concurrency, we are now sharing the key, which opens the door to a healthier revenue and cash flow. Of course, we thought about your pocket too, so we gathered the less expensive way to achieve your goal.
Why Does Average Order Value Matter?
Knowing your company’s average order value helps you evaluate your overall online marketing efforts and pricing strategy by giving you the metrics needed to measure the long-term value of individual customers.
As a benchmark of customer behavior, the average order value helps you set goals and strategies and evaluate how well those strategies are working.
Sometimes marketers focus much of their energy on increasing traffic to a website when it would more impactful – and profitable – to increase their average order value. Increasing traffic typically costs money, while increasing average order value does not.
Since there is a transaction cost associated with each order, increasing your average order value is a way to drive direct revenue and increase your profits, as the customer is already buying from your store.
Product Recommandations
Jane next week is invited to an event, so she is now sailing on the internet, searching for the perfect pair of shoes, so she googles “elegant shoes for ladies”. She finds a site and starts to search. Sometimes, customer’s don’t really know exactly what are they searching for, so they need some help for selecting the offers. Using recommendations is always a great choice. After some time, she finds the perfect shoes and the price is correct too. Below the product description, the page is popping up a variety of other shoes that have higher price, but has a better quality too. This technique of suggesting a larger or more expensive version of the product your customer is viewing is called Up-Sell. She clicks on the product with a better quality, and an image with a handbag that is the same color as the chosen pair of shoes comes up as recommendation. This technique of suggesting additional products related to the one your customer is viewing is called Cross-Sell. You can also suggest her the entire product bundle, so she can buy an entire set, in this example the pair of shoes, the bag and a dress.
Shipping options and easy return management
You know what would make Jane happier and your average order value bigger? An Extra Shipping Option. People tend to be more receptive when they see the free shipping. You can mention that the shipping is free above a given price. Jane’s mind starts to analyze, so if she chooses the product bundle, which in this case let’s say is above the given price, the shipping will be free. “What a great deal” – she thinks. You can also opt for a discount instead of free shipping, or if it’s Jane’s first order, you can give her the free shipping as a gift, is up to you.
The delivery arrived with Jane’s order, and she is impatient to try on the products, but she finds out that the dress doesn’t fit her. What will she do? Of course she will ask for a return or if it’s possible, for an exchange with another measure. It will be so helpful if she could talk to the Customer Service team about the returning process.
Customer reward and loyalty program
At the end, Jane receives the fitting measure and both of you are happy and it is more likely that Jane will be a recurrent buyer. Next time Jane wants to buy an item from your website, you can offer her a Customer Reward. You can juggle between discounts/promotions if they spend more money or buy additional items, or by the rewarding points, so the more money they spend, the more points they get.
Personalised shopping experience
Personalising the products around your customer’s needs will also be a great help in increasing your average order value. By creating customer groups, personalized banners, automated related products and custom promotions, you personalize and create a content for their needs, so it is more likely to convert them in recurrent customers. If you want to keep things simple, for example, you can personalize the welcome message with the customer’s name.
If you want to have a healthier average order value, check out our Magento Consulting Services.
