If you find yourself constantly bleeding money trying to acquire that valuable traffic, or are nervously checking your Analytics tools, looking at the traffic sources and visitor behavioural patterns, this article is for you.
At the end of the day what you are looking for is increased revenue, ad there is more than one way to achieve this. For example one of the tricks to improve your e-commerce sales is to increase the average online order value.
Average Online Order Value = Total Revenue / Number of Orders Taken
Here are a few tips to help you achieve this.
Tip #1 – Offer Discounts On Minimum Purchase
One way of increasing your average online order value can be offering 15% off all purchases over €250 or whatever figure fairly makes up for your lost margins in giving that discount. Use the principle: “Give some, take some.” Make sure your discount has an expiry date – leaving this important aspects sometimes backfires when you least expect. Add terms and conditions in small print to cover every aspect of the discount offered.
Or you can offer a membership registration for a coupon with a particular discount (minimum spend apply- do not give out discounts for nothing!). The exception perhaps is offering a particular discount off the first purchase (registration a must in this case) – this will help attract new customers and add them to your database or mailing list (this can be added to the T&C’s)
Tip #2 – Offer Free Shipping
Another great tactic to increase your average online order value is to offer free shipping on orders which are a slightly more than your current average online order value.
However, be aware that free shipping is a tricky subject. Your average online order value will increase, but the additional shipping charge could reduce profit from the transactions. There is a lot of research available to suggest that the lack of free shipping is the biggest reason for cart abandonment. However the research made by Deliotte also shows that 40% of customers are willing to buy more items if they qualify for free shipping.
So what do you do?
The way to find out what works best on your website is a good old A/B testing: test between completely free shipping and one that is free after a minimum order value. The metrics to watch closely are average online order value, number of sales, revenue and cart abandonment rate.
Tip #2 – Upsell & Cross-sell
Upselling, if used intelligently, is a fantastic way to increase the value of an order. If a visitor is checking out that Joseph Ribkoff Animal Print Dress, just throw in the gleaming photo of that stunning Heidi Higgins Animal Print Dress on the side. In other words, upselling is offering a similar but more expensive variant of the product to the buyer.
But don’t just randomly throw in products just because you have them in stock! Make your upsells related to your original product. Be sensitive about your price- not everyone has tons of cash, you need to know and understand your customers before you upsell them.
Make it easy for your customers-let them complete the purchase of the first product and then offer them a few options, right after they click the buy button. Ideally ask your developer to make it so that people don’t have to re-enter their credit card information if they choose to take an upsell (usually by requiring to register in the first place). Once someone has used your product or service, you can then drip them through email over a period of thirty or sixty days and offer them more upsells.
Same thoughtful approach applies to cross-selling. Do you need a bag for your laptop? Here are the lenz cleaners for your camera? This is softly selling complementary or additional products to a customer, therefore increasing your average online order value. The main thing to keep in mind here is that the suggestions need to be relevant. Do not offer a camera bag to the customer who is buying a laptop. A bit of time and effort selection cross-sells and upsells will pay off in time with larger average online order values.
Important Do’s and Dont’s
- Don’t implement all these tips at once.
- Do A/B test these strategies to find out what works the best for you
- Do strike a balance between discounts offered and your profit margin
These are some very easy but effective ways to increase your average online order value and together with increasing purchasing frequency should improve your profit figures and give you a chance to enjoy your life for a change!