Average Order Value (AOV) is one of the most important things to look at for any Shopify store that wants to make more money.
If you're a Shopify seller, you know that raising your average order value (AOV) is essential to your business's success.
If the AOV is greater, it means that customers are spending more money on each purchase, which means that the business is making more money.
In this short blog post, we've put together this list of great ideas to help you raise your Shopify Average Order Value Let’s go!
AOV is the average amount that each customer spends in your store. It can be a sign of how well your Shopify store is doing and whether or not people like shopping there.
By knowing AOV, a seller can make changes to their prices, deals, and product lines to boost sales overall. And this reveals consumer loyalty by showing how much they're willing to spend per transaction.
To figure out the average order value
Divide the total amount of money made by the total number of sales made during a certain time period.
Average Order Value = Total Revenue/Total number of orders
Assume that you made $3,000 in sales from 150 orders at an average price of $20 per item. That is, if we take off the cost of promotion, each client spends $20.
Your average order value is determined not by the number of people that shop in your store, but by the number of orders they place.
Each customer's cumulative orders will be added up to their corresponding AOV.
A good AOV relies on a lot of things, like the type of products you sell, who your target market is, how you set your prices, and more.
AOV is important because a low average order means fewer sales from customers and a lower return on investment (ROI). To boost sales, you might want to lower prices to gain customers' trust, make them feel at ease, and get them to place more orders.
The average order value is very important because
It's the only method to quantify the value of each individual client to your business. It's a numerical indicator of how effectively you're able to increase the average order value for each customer.
Here are six ways to raise your Shopify's average order value!
1. Provide discounts and free shipping - Free delivery and discounts can boost your Shopify average purchase value.
Customers increase order size to save money with discounts and free shipping. They can eliminate an obstacle to shoppers' orders.
For example; Offer 10% off orders over $50 and free shipping on orders over $75, for example. Putting a notice bar on the homepage of your store can help your discount or free shipping campaign work better. It will let buyers know about any recent deals.
Your average order value will probably go up. Customers will be more likely to put more things in their carts in order to get discounts and free shipping.
2. Product upselling and cross-selling - Upselling and cross-selling are the best techniques to boost Shopify's average order value.
Up-selling pushes clients to buy a more expensive or improved product while Cross-selling is a way of selling related products to existing buyers.
For example; If a customer comes to your business and wants a basic laptop, you could persuade them to buy the premium version. An appealing discount or bundle package can encourage customers to buy something more valuable.
As a result, Your Shopify store's average order value (AOV) and bottom line will both grow.
3. Promote product bundles - Offering product bundles can boost your Shopify average order value. Product bundle pricing saves clients money and makes it easy to buy related items quickly.
For example; Consider a Shopify clothes business with a $50 dress that sells well. Bundling the dress with jewelry or shoes could enhance the AOV from $50 to $60–$100, depending on the item's worth.
Make sure the package prices are appealing to clients so that they feel like they are receiving a bargain.
4. Get your product pages optimized - Improved product pages are a superb way to boost Shopify's average order value. Beautiful product pages inspire visitors to add extra products to their cart during checkout.
For example; Suppose you own an apparel store, you can also use beautiful pictures and convincing product descriptions to make people want to buy more than one thing at a time from a single page.
Make sure your product descriptions are accurate and full to maximize the effectiveness of this method.
5. Allow installment payments - The average order value you see on Shopify can be increased by offering payment options. It's a cheap and easy way for an online seller to boost their revenue without investing more time or money in advertising.
Customers can buy from you in installments rather than all at once when you provide a payment plan.
For example; If your store's average order value is $100, you might offer three $33 installments.
Offering easier and more flexible payment methods also helps in building consumer loyalty.
6. Make a customer loyalty program - Loyalty programs give customers rewards, perks, and savings based on how much they've bought from your shop in the past.
For example; If a consumer has spent $500 in your Shopify store, you might incentivize repeat business by giving them 10% off their next purchase.
Offering unique discounts or rewards points each transaction is an effective loyalty program. Reward points can be redeemed for goods and services.
Boosting your Shopify average order value has various advantages;
- You can make more money per customer without getting new ones. This is important since attracting new clients costs 5-10 times more than selling to existing ones.
- Profit margins can be increased because of this. The reason for this is that if your profit margins are higher, you will have more money to invest in product improvement, shipping, and other overhead costs.
- It can help you pay for other ways to grow. For example, if you want to pay for marketing or hire a new employee, a bigger AOV will give you the extra money you need.
You might also be interested in this kind of topic; Shopify One-Click Checkout!
Start right away!
The right way to figure out your average order value can help you figure out how well your store is doing. After you've figured out your average order value, try putting some of the ideas we've given here into action to raise your AOV on Shopify.
Remember that progress doesn't happen overnight, so you should take the time to figure out what works best for you.
Start by using smart upsell and cross-sell tactics, along with a personalized experience and a threshold for free shipping. It can help you get your store back on track so you can get more orders.
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FAQs
How exactly do you compute AOV?
To determine your average order value (AOV), divide your total revenues in your Shopify store by the total number of orders placed in your shop.