Table of Contents
- Introduction
- Offer a Bundle Deal
- Offer Discounts with a Minimum Purchase
- Offer Gift Cards for Specific Purchases
- Encourage Customers to Purchase More Expensive Products
- Text Customers to Remind Them to Return to Their Carts
- Additional Strategies to Boost Average Order Value
- Conclusion
Introduction
Did you know that 40% of shoppers admit to spending more than they budgeted? For online retailers, this statistic presents an opportunity to encourage customers to increase their average order value (AOV). In physical stores, retailers strategically place last-minute, low-cost items at the checkout to tempt customers into making additional purchases. But how can online businesses replicate this tactic? This blog post explores five creative and effective strategies for boosting AOV in your eCommerce store. By the end of this article, you'll have actionable insights into how you can implement these strategies to drive higher cart values and happier customers.
Offer a Bundle Deal
One of the most straightforward ways to increase AOV is through bundle deals. When customers see a curated set of products offered at a slightly discounted rate compared to purchasing each item individually, they perceive greater value. Take Amazon, for example, which shows "Customers often bought these items together" prompts that encourage purchasers to consider additional products. Studies indicate that these types of recommendations can account for a significant portion of sales.
Bundles simplify the purchasing decision by presenting logically grouped items, often at a price that seems like a deal compared to buying each product separately. This not only benefits the customer by offering perceived savings but also helps move more products faster. Consider bundling items that are frequently used together or products that naturally complement each other.
Practical Application
For instance, if you run a cosmetics store, you could bundle a facial cleanser, moisturizer, and toner as a skincare set. Alternatively, tech stores might bundle a laptop, mouse, and carrying case. Highlight the cost savings customers will enjoy when they opt for the bundle, reinforcing the perception of value.
Offer Discounts with a Minimum Purchase
A highly effective strategy for increasing AOV is to offer discounts or free shipping for orders that exceed a certain amount. Large eCommerce sites like REI use this tactic to great success, often setting the threshold at a level slightly above the current average order value. This nudges customers to add just a few more items to their cart to qualify for the deal.
Surveys suggest that a significant percentage of customers are willing to spend more to qualify for free shipping or discounts. Reminding customers of these promotions within the shopping cart can effectively prompt additional purchases.
How to Implement
Evaluate your current average order value and set your promotional threshold at approximately 10-20% higher. If your average order is $45, consider offering free shipping for orders over $50. Not only does this encourage customers to spend a bit more, but it also builds customer satisfaction as they feel they are receiving better value.
Offer Gift Cards for Specific Purchases
Gift cards can serve as a powerful incentive for future purchases, ensuring repeat business while increasing your AOV. By offering a gift card that can only be used on subsequent visits, you provide an incentive for customers to return. However, this method requires careful planning to ensure customers cannot use the gift card on low-cost items.
For instance, offering a $5 gift card for orders over $25 can successfully prompt additional purchases in the future. This tactic is particularly effective in securing long-term customer loyalty.
Best Practices
To maximize the effectiveness of this strategy, make sure the gift card can’t be redeemed for items lower than its value. This way, customers will either have to buy higher-value items or combine the card with a larger purchase. Department stores like Target have effectively used this strategy, noting that shoppers often spend beyond the value of the gift card, making it a win-win scenario.
Encourage Customers to Purchase More Expensive Products
The 'Good, Better, Best' pricing strategy encourages customers to opt for premium products by offering them in tiers. Different businesses, from car manufacturers to service providers, have used this approach to successfully upsell their products.
For instance, amusement parks like Six Flags offer various pass levels, allowing customers to pay more for reduced wait times on rides. This system has proven highly successful, with a significant percentage of customers opting for top-tier options.
Implementation Advice
Highlight the additional benefits of premium products clearly. For example, if your store sells software, you might offer basic, professional, and enterprise versions, each with a progressively richer feature set. Ensure that the value provided by upgrading is apparent and compelling enough for customers to justify the higher cost.
Text Customers to Remind Them to Return to Their Carts
Cart abandonment is a significant challenge for online retailers, but one way to combat it is through timely text message reminders. Unlike emails, which can often get lost in spam folders or ignored, text messages have a high open and read rate. Statistics reveal that 95% of text messages are read within three minutes, making SMS an effective channel for reminding customers to complete their purchase.
Easy Implementation
Utilize platforms like TextMagic to send automated reminders to customers who have left items in their carts. When a customer receives a prompt via text, it nudges them back to your website, potentially increasing your AOV by driving conversions that would otherwise be lost.
Additional Strategies to Boost Average Order Value
Implement a Loyalty Program
Loyalty programs offer points or discounts for repeat purchases, rewarding customers and encouraging more frequent buying. This not only increases the AOV but also enhances customer retention.
Use Exit-Intent Popups
Exit-intent popups can offer last-minute discounts or special offers just as customers are about to leave your site. This tactic can convert a hesitant visitor into a buyer, further increasing the AOV.
Personalize Product Recommendations
Utilize data analytics to recommend products that are most relevant to each customer. Personalized recommendations can lead to additional purchases, thereby driving up AOV.
Create Limited-Time Offers
Limited-time deals or flash sales create a sense of urgency, prompting customers to make purchases quickly. Such deals can be highly effective in increasing the value of an average order.
Enhance Product Descriptions and Images
Detailed product descriptions and high-quality images can provide customers with the assurance they need to make higher-value purchases. Clear and comprehensive information reduces hesitancy, leading to larger cart sizes.
Conclusion
Increasing the average order value in your eCommerce store is not only about clever marketing but also about genuinely enhancing the customer's shopping experience. By implementing strategies such as bundling, offering minimum order discounts, utilizing gift cards, promoting high-quality products, and leveraging text reminders, you can significantly boost your AOV. Enhancing personalization and creating urgency with time-sensitive offers further contributes to achieving this goal.
Frequently Asked Questions (FAQ)
1. What are bundle deals and how do they work?
Bundle deals group multiple items together and offer them at a discounted price compared to purchasing each item individually. This strategy simplifies the buying process and provides perceived value to the customer.
2. How can offering gift cards increase average order value?
Gift cards incentivize future purchases. When customers receive a gift card with a purchase, they're likely to return to your store and often end up spending more than the gift card's value.
3. Why are text message reminders effective for cart abandonment?
Text messages have a high open rate, with 95% being read within three minutes. This makes them effective for reminding customers to complete their purchases, reducing cart abandonment rates and increasing AOV.
By thoughtfully integrating these tactics into your eCommerce strategy, you can create a shopping environment that not only encourages higher spend per visit but also fosters long-term customer loyalty.
