Boost Your Bottom Line: Clever Ways to Increase Average Order Value

Boost Your Bottom Line: Clever Ways to Increase Average Order Value

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Introduction

Did you know that increasing your Average Order Value (AOV) can have a bigger impact on your bottom line than acquiring new customers?

In this post, we'll explore clever strategies to boost your AOV, helping you maximize revenue without the need for additional customers. Today, we’ll delve into practical tactics that can give your revenue a significant boost.

1. There are only 3 ways to increase revenue (or at least most can be bucketed into these 3)
   1. More new customers
   2. Increasing AOV
   3. Increasing Order Frequency

We tend to be addicted to lowering ROAS targets to generate more traffic with the hope of getting more customers. It works well but it’s worth questioning whether this is the most impactful lever to peull. Today, we’ll delve into practical tactics that can give your revenue a significant boost.

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Bundle Up: Product Bundling

Explanation: XYZZ

Examples: Manscaped’s grooming kits, where combining a trimmer with grooming accessories and products encourages customers to spend more.

Tips: Leverage data. Pre-packaged kits are most effective for products that are complementary or meant to be used together. Choose items that your data tells you are commonly bought together. For instance, if you have a history of customers purchasing socks with shoe purchases, that’s a solid indicator that you have an opportunity to sell a bundle. Use Shopify’s Bundler to create your first bundle today.

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Upsell and Cross-Sell with Purpose

Explanation: The difference between upselling and cross-selling, and why both are important.

Examples: Apple’s upselling with better storage options for their devices, or Netflix’s cross-selling with personalized show recommendations based on your viewing history.

Tips: Identify opportunities for upselling and cross-selling on your website. Use customer data to suggest relevant add-ons. The more personalized, the better. Think of how Amazon recommends products based on your browsing history.

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3. Stock Higher Priced Goods

Explanation: Seems overly simple, but if your products are low value, it makes paying for advertising an uphill battle.

Examples: Ask yourself if there’s an underserved audience in your offering. For example, in wedding rings, some people want to spend a specific amount, like $5,000. If you only have goods priced up to $3,000 and maybe another at $10,000, you might miss the opportunity to close a sale at $5,000. 

Tips: Check your Website Price Ranges and see if you have an underserved Price Range‍

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 4. Offer Free Shipping Thresholds

Explanation: How setting a minimum order value for free shipping can encourage higher spending.

Examples: Brands like Sephora offering free shipping on orders over $50, encouraging customers to add more items to their cart to meet the threshold.

Tips: Find the sweet spot for your threshold – high enough to boost AOV, but not so high it scares customers away. Retailers like Target and Walmart use this strategy to great effect.

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5. Personalized Recommendations

Explanation: The power of personalized product recommendations in increasing AOV.

Examples: Amazon’s personalized “You might also like” section, which recommends products based on your browsing and purchase history.

Tips: Use AI and machine learning to analyze customer behavior and suggest items they’re likely to buy. Show your customers you know them by offering personalized product recommendations. It’s like having a personal shopper who knows their tastes.

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6. Offer Bulk Order Discounts

Explanation: How bulk order discounts can encourage customers to buy more at once.

Examples: Bulk.com’s model of offering discounts for purchasing larger quantities of protein powder, encouraging larger purchases.

Tips: Clearly communicate the benefits of buying in bulk. Another strategy is purely telling users how long you can guarantee the discount to create urgency. Promote these offers through email and social media to create buzz and drive traffic to your site.

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Conclusion

Boosting your AOV isn’t just about squeezing more money from your customers – it’s about providing value and enhancing their shopping experience.

Start implementing these strategies today and watch your revenue grow. Got any tips or success stories? Share them in the comments – we’d love to hear from you!

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