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3 Ways to Increase Average Order Value of Online Stores

3 ways to increase average order value for online store

Congratulations! You’ve successfully launched your new ecommerce store and orders are starting to come in every month.

You feel like you’re finally at a point where want to grow revenue but you’re not sure where to start. That’s when you notice your average order value (the average amount of money each customer spends per transaction with your store) is fairly consistent over time. What’s the best way to entice customers to spend more?

Minimum Order Discounts

For many ecommerce retailers, increasing average order value often starts with offering minimum order discounts. For example, Pump Peelz, makers of personalized insulin pump covers and diabetes accessories, offers free shipping on orders over $30. 

Before you offer any minimum order discounts, make sure you look at any available data to get a sense of average order values over time so you can pinpoint a realistic price target. In other words, if your average order value over the last six months is right around $50, it might be hard to jump to $75 and expect customers to make that big of a jump. This is especially true if you the majority of your items are at lower price points which would require customers to buy multiple products to make up the difference. 

I also spoke with an online store owner this week who is using the Sumo app to increase average order value by engaging customers with strategically-placed incentives. It’s still early, but initial results seem promising. 

Related Products

How many times have you been shopping for one product on a website only to be taken down a rabbit hole by another product you didn’t even know existed? Ecommerce platforms make basic product recommendations fairly simple to incorporate on your product pages and checkout page like this example from Mapamundi Kids--an independent kids lifestyle store based in San Francisco, California.

Once you add related products to your website, click around and make sure the items that are showing up make sense either based on the featured product and/or your business goals. Depending on your ecommerce platform or the app you’re using, you can control the number and types of images that get displayed. Think strategically.

Product Bundles

By packaging multiple products together (often at a slightly discounted price) in a bundle, you’re increase real or perceived value--increasing the likelihood that shoppers will buy more than if the products were only listed separately on your site. 

If your ecommerce platform offers website cart analysis, I highly recommend looking at which products are frequently added together for ideas of which products to bundle. You can also look for complimentary items to add to create a “one-stop shop” for anyone buying a specific product (ex. Audio Advice bundling bookshelf speakers with a turntable).

Next Steps

Once you’re able to establish a clear baseline for your average order value, you can start to experiment with different strategies and tactics to see how far you can move the needle and increase revenue. Even small increases per transaction can add up over the course of the year. 

Make sure you give yourself enough time to identify what’s working and what isn’t. It can be tempting to pull the plug after only a few days, but you want to wait at least two weeks before making another change.

Finally, keep testing. Try different minimum order amounts for free shipping at $50, $60, and $75 and the same with discounts. 

Do you have other strategies you’d add to the list? Leave a comment below!

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