5 Effective Strategies to Boost Average Order Value in 2024

What is average order value?

Average order value (AOV) is a key metric that measures the average amount of money customers spend on each transaction with your ecommerce store. It is calculated by dividing the total revenue by the number of orders.

A better way to think about average order value

Instead of simply focusing on increasing the number of orders, it’s important to also consider increasing the average order value. By increasing the amount customers spend per transaction, you can boost your overall revenue and profitability.

Five ways to increase average order value

1. Create an order minimum for “free shipping” and other gifts

Offering free shipping or a free gift with a minimum purchase order can encourage customers to add more items to their cart in order to reach the threshold. This not only increases the average order value but also provides an incentive for customers to make larger purchases.

Kopari Beauty offers free gifts with a minimum purchase order and promotes this through its in-cart messaging:

2. Bundle products or create packages

Creating product bundles or packages that offer a discount for purchasing multiple items together can entice customers to spend more than they originally intended. This strategy encourages customers to add more items to their cart in order to take advantage of the bundled pricing.

3. Upsell or cross-sell complementary products

When a customer is about to complete a purchase, suggest additional products that complement their original selection. This could be as simple as recommending a matching accessory, or a higher-end version of the product they are already purchasing. This can significantly increase the average order value.

4. Set up a customer loyalty program

A loyalty program that rewards customers for spending more can encourage them to increase their average order value in order to reach the next reward tier. This not only increases customer retention but also incentivizes larger purchases.

5. Provide fully staffed live chat support for quick questions

By offering real-time support through live chat, you can help customers make informed decisions and potentially upsell them on additional items. This personal interaction can lead to increased trust and higher average order values.

Sell more to people who want to buy

By implementing these strategies, you can effectively sell more to customers who are already interested in making a purchase, ultimately increasing your average order value and boosting your ecommerce revenue.

Average order value FAQ

Why is average order value important?

Average order value is important because it directly impacts the overall revenue and profitability of your ecommerce store. By increasing the average amount customers spend per transaction, you can maximize your revenue without necessarily needing to increase the number of orders.

How do you measure AOV?

To measure average order value, simply divide the total revenue generated by your ecommerce store by the number of orders placed within a specific time period. This will give you the average amount customers spend per transaction.

What is average order value KPI?

Average order value is a key performance indicator (KPI) that helps you understand the spending behavior of your customers. It can be used to track the effectiveness of your marketing and sales strategies in increasing the amount customers spend per transaction.

What affects average order value?

Several factors can influence average order value, including pricing strategies, product bundling, upselling and cross-selling techniques, as well as the overall customer experience provided by your ecommerce store.