Increasing AOV: How to Increase Average Order Value for Your Store

Last updated: September 18, 2023

Everybody loves making as much money as possible. And when you’ve got a business, every extra dollar you can add per order can help you run your business more profitably. If you’re running ads, the cost per acquisition can be high, which can eat away at your profit margins. So, when running a business, the question to ask yourself is, “How can I increase average order value to run my business profitably?” then the focus should be on continuing to increase those orders with product bundling, experimenting with a variety of marketing strategies in your store, and more.

Benefits of Increasing Average Order Value

See product data evolve.

When you focus on increasing your average order value, you’ll see your product data evolve. That means you’ll start to see what products people are more likely to buy in bulk, what preferences your shoppers have, and what types of products perform best. As you gain more data, you can run a more efficient and effective business as you start to optimize for better performance. In the end, you’ll see fewer people make a return, too. The analytics you get from selling more products will help you run a better business.

Run a more profitable business per order.

When you have an average order value strategy, you can run a more profitable business. When selling physical or digital products, you tend to have smaller margins as the product cost (creating it, manufacturing it, supplies, ingredients) can all add up. So, when you sell higher volumes or bundles, you can earn more per sale, allowing you to inch closer to profitability.

Increase the number of orders to sell through inventory.

If you carry inventory for your business, increasing your average order value will help you sell instead of products just taking up space and costing you money by staying on your shelf. Having a dashboard that monitors the performance of your products will help you when running a business that carries inventory, as you’ll know what deal to set up to sell products. You can partner with brands or influencers to help promote your products to their audience to see if that gives you the sales boost you need to sell through. But doing tactics like bundling products or encouraging more volume through discounts or shipping can also help you sell through your inventory.

In this article, we will share 12 strategies you can implement to increase average order value.

1. Offer free delivery
2. Give free samples
3. Do product bundling
4. Have a wholesale strategy
5. Offer discounts per average order
6. Sell gift cards
7. Have a first-time offer
8. Offer an up-sell or cross-sell
9. Create a customer loyalty program
10. Have a strong pricing strategy
11. Give personalization recommendations
12. Categorize similar products

How to Increase Average Order Value

1. Offer free delivery

Offering a free shipping threshold could help boost average order value. If you’re shipping physical products, you’ll want to only offer free shipping with a specific minimum. If you offered free shipping on every order with no minimums, you would eat away at your profit margins. However, if you offer free shipping with a minimum of three cases or a minimum spend of $100 or whatever the exact number that would be most profitable, you could see a better average order value for your shop. Free delivery is a perk that most people want as it keeps their shopping experience affordable. However, people would be willing to buy more things from your store to save on shipping as they’ll get more stuff to keep.

2. Give free samples

Increasing the order value can be done with freebies like free samples. Sometimes, you just need people to try out cool products to help them realize they want to purchase more from your shop. For example, if you focus on a wholesale strategy, you might give away free samples to local businesses to try out and see if they like the product. If they do, they’ll bulk order large quantities to sell in their shop. Alternatively, if you own a beauty store, you can give away free samples to customers online or in person to try out. If the customer likes the products they got to sample, they may end up purchasing more stuff from you, increasing your overall orders but also your order value. The data shows that free samples do help you generate more income and can boost order values.

3. Do product bundling

You can triple your profits by doing something as simple as product bundling on your website. If you sell printables, instead of selling them individually, you can create themed bundles with multiple products within them and charge a three times or higher multiple to really rake in the dough. The perceived values increase when people get more stuff with their orders. A bundle seems like a better deal than just one product. Even if it’s a buy three get one free promo or a set with all your products bundled in one, it appears like a better deal. It may cost the consumer more to pay for, but as a result, the average order value also rises. When people order online, they often want a good deal, so bundling products can give people that feeling while allowing you to earn more from your orders.

4. Have a wholesale strategy

The right wholesale strategy can easily increase sales and average order value. If you sell physical products on your online store, you can also sell cases of products to brick-and-mortar locations. For example, if you have a food company with a proprietary product, you can increase AOV by selling multiple cases to stores in your area or even across the country. You don’t need to be on Shopify; you can do this on any ecommerce platform, even Payhip.

To entice business owners, you can offer a free sample for people to try out and examine to see if it’s a good fit for their shop. Then, when they’re ready to buy, you can encourage them to purchase higher volumes to sell through. For you, it’ll be an ecommerce transaction, but the shop owner will sell it to the end user via their shop. They’ll be responsible for attracting foot traffic and marketing. All you need to do is Google shops in your area and ask them to see if they’re interested.

5. Offer discounts per average order

When it comes to average order value, believe it or not, you can offer discounts to increase it. Say you know the average consumer spends $50 shopping on your website. You might offer 5% off if they spend $75 or more, 10% off if they spend $100 or more, and 25% if they spend over $150. Having multiple tiers with higher discounts will help people spend more money even if they are budget-conscious. If there’s a purpose for their shopping, such as back to school, holiday, or a special occasion, they may be willing to complete more of their purchases shopping on your site instead of bouncing around to multiple sites. You don’t need to offer free stuff to increase average order value; sometimes, incentivizing with a discount works great. Whether someone shops in-person and uses your POS system or online doesn’t matter, as you can easily set something up like this online for all shoppers.

6. Sell gift cards

Improving average order value can be as simple as selling gift cards. Firstly, most people don’t end up using gift cards or their full amount, which can make them very profitable for businesses. However, they’re also impactful when it comes to increases in sales profits. For example, when people use gift cards, they usually spend more than what’s on the card when shopping around. The gift card they’ve been gifted acts like a discount on a big shopping excursion.

7. Have a first-time offer

If you want to see an increase in your order volume and value, you can have first-time offers for new shoppers. Even if you sell tools, customers will appreciate a first-time offer. Maybe you offer a discount to test out your product or service instead of a free trial. Free trials typically lead to churn or cost your business money anyway, so trading that trial period for an offer like a free digital product, a 1-on-1 consultation with a client, or a coupon code in exchange for their first order is a better option.

8. Offer an up-sell or cross-sell

To boost average order value, you can also offer upsells or cross-sells. If you’re doing a big digital product launch, you can see a rise in average order value by having upsells or cross-sells. Your big offer might be an online course you’ve created, but since people are in learning mode, having other offers that boost their learning could be a great way to monetize beyond just your course. You might have an ebook that complements your course material as a cross-sell. You might even have other course offerings for your upsell, such as an advanced version of it or a beginner version, depending on what stage they’re in. In the end, when people see a pop-up showcasing these other offers, you can raise order value.

9. Create a customer loyalty program

To improve average order value, you might want to create a customer loyalty program. In this program, you’ll offer perks for staying subscribed, purchasing new products, and staying engaged with your business. If you’re a retail business, your customer loyalty program might reward points that can be redeemed for discounts on future purchases. Alternatively, if you own a software company, you can offer digital products, such as mini ebooks, fact sheets, exclusive case studies, or even some free tools for people subscribed to membership sites to keep them engaged for a more extended period.

10. Have a strong pricing strategy

When selling digital downloads in packages, you want to have a pricing strategy that attracts people to the middle tier. The lower option should have fewer features or some unattractive features, such as a watermark, to justify the lower price. The middle tier is what you want most people to pay for and should be the best plan for most brands or customers. The highest tier should be for enterprise brands, with more advanced services, features, perks, or items to justify the highest price bracket. If most people buy the middle or highest tier, this increases the average order value. Your conversion rate on these tiers should be higher than the lowest tier. You can use web design to highlight higher-priced plans by adding emphasis in the design in the tier you want people to purchase from.

11. Give personalization recommendations

You can look into many metrics to master the optimization of your average order, but personalization will probably work best. Of course, you can do the standard name, clothing sizes, and more when running an online store. However, those selling digital products can also offer personalized services. For example, stylists often offer style guides based on your body type, undertone, and more to help you shop for yourself. However, by selling this as a service, they can also take personalization up a notch by offering to do online shopping based on your body type and color palette as a service. This personalized service can be an add-on feature of recommendations for a service-based business or fashion agency to sell on top of their standard products.

12. Categorize similar products

One of the ways to increase average order value is to add similar products together. For example, if you have an online clothing store, you might have a shirt in a style available in multiple colors available on the same page. If someone likes the style of the clothing, they may feel more compelled to buy the other colors alongside it to have more variety. Sometimes, clothing stores separate colors into separate product pages, but this can prevent some people from finding that the top they like comes in colors they really like. So this can increase average order too. Consumers will impulse buy products they want in different colors just because they like the style. So, doing this is a must.

Conclusion

You can sell both physical products and digital products using a platform like Payhip. Payhip is a website builder that has countless features, allowing you to have a strong average order value. You’ll be able to add discounts, set your own pricing, have instant downloads, up-sell or cross-sell your products, and so much more.

The best part is they even have a Free Forever plan that allows you to have no monthly subscriptions and only pay a small 5% transaction fee so you can run a more profitable business. If you’re thinking about how to increase your average order value, consider building your website on Payhip today.