Traditionally within ecommerce, we tend to focus on two main metrics; conversion rate, the rate of website visitors that convert into a sale, and the traffic; the amount of people who come to your store. So let’s take this back a step, you're getting customers to your website and a good percentage of them buy from your store, but what if you could get them to buy more when they do convert - say hello to the average order value. This article delves into how to increase your average order value on Shopify stores and convince your customers to spend more with each sale. E-commerce shoppers and buyers are extremely savvy, so ensure you are offering your customers the best deals, the best user experience, for anything you sell. The impact of some of these strategies have proven to work with our merchant base however it's important to remember that every brand is different.
The average order value (AOV), on Shopify, is the average amount that a customer will spend when they buy on your website. If you are new to ecommerce and are considering Shopify you can read our article all about
why you should choose Shopify. The benchmarks for average order value for your business will naturally vary based on the average cost of your products i.e. if your product's average price is £2.99 then you can expect your average order value (AOV) to be lower than a Shopify merchant whose average price is £100. When trying to optimise your average order value you should ensure that you have a good conversion rate otherwise there may be some fundamental floors in this statistic and you need to consider if you are getting enough traffic to your site to have enough data to truly understand what the average person spends. We would always recommend focusing on improving the conversion rate and traffic before deep diving into improving your average order value, the most important factor are getting customers to buy at all.
Average order value is an incredibly important metric as it’s the sole measure of how you track the worth of each customer you receive at your store and also a way to track your efforts to improve the amount each customer spends. For example, let’s say the average price of your products is £5.99, you get around 1,000 customers per month and 4% of those convert into a sale. On average customers buy three products which equates to an average order value of just under £20. You can expect sales of around £800 per month. You can then use the current average order value of £20 as a benchmark to start improving upon. We’d advise you to implement new changes and re-assess the average order value (AOV) again every month and keep track of it in a spreadsheet so you can clearly see what’s working and what’s not. We’d advise you to see if you can find any information on what the average order value is for your industry too as they will be vastly different between business types. If you are a
Shopify Plus customer then you can leverage Shopify's native reporting tool called
Shopify Benchmarks to see how you compare against similar brands on Shopify. But the big question is “How do you increase your average order value (AOV)” in the first place?
There are a number of strategies that you can use to increase your average order value and it will be up to you to think what is the most appropriate to your business and what you hypothesise will work best with your customers. Don’t be afraid to try multiple, and replace ones that haven’t made a difference. The following strategies are all centred around two core principles: A) incentivising customers to buy more whilst also delivering and informing customers of other potential purchase opportunities. Remember the average customer will spend less than a minute on your website, they may never even see the products they might have purchased. This guide will help you with tactics to get customers to spend more, maximise profitability with increased revenue whilst considering customer lifetime value. So here’s a few ideas you can try . . . let us know how you get on! If you require support, then do consider our strategy packages and services to help you maximise AOV on your Shopify store and get customers spending more money.
Product bundling is a great way to tempt your customers by buying multiple products at once.
See our Shopify Bundles guide. A great way of increasing average order value on Shopify is it presents an opportunity for customers to see two of your products - usually at a reduced rate. Not only does it allow you to incentivise spending more with multiple products, but sets or bundles are a great way to immerse customers in more of your product range. We often observe that many customers will miss products that they would otherwise buy - product bundling is a great way to expose more of your product range. To track inventory it’s important to try and keep the individual SKUs being added to the cart rather than creating a new product together to embody both products. Product bundling can be a challenge on Shopify, however there are several apps that allow you to achieve this. For example
‘Shopify Product Bundler’ which displays a bundle widget on individual product pages. With some additional development, we can even show individual product pages that display just the set alone.
Get in touch if you’d like to discuss rolling out stand-alone product bundle pages.
Cross-selling and upsells to increase average order value.
Cross-selling and upselling on Shopify is one of the best ways to improve average order value. Upselling involves persuading customers to upgrade to a higher priced product compared to cross-selling which involves suggesting complementary or suggested products after a customer has shown intent to buy a product already. There are several ways to roll out cross-selling and upselling on your Shopify store you may need to consider products that are appropriate add-ons.
Shopify includes “you may also like” suggestions in all themes which intelligently suggests products unique to the customer. The factors that
Shopify’s algorithm uses does depend on the plan that you subscribe to. We recommend showing the Shopify “You May Also Like” section on product pages to allow customers to view products they have clicked on whilst being suggested other products too. You can also use this section across content-driven pages too; such as your story page, blog and more - a great way to bridge your content and ecommerce funnel.
Another option you have is to utilise a pop-up when a customer adds an item to the cart or when they click the checkout page. Although there are some apps on
Shopify's app store, we often recommend building these out from scratch so you have full control over the user shopping experience. It is important not to overwhelm customers with an extended checkout process otherwise you risk increasing cart abandonment rates. We designed and developed a cross-sell popup for Doisy and Dam; when the customer adds their first item to the cart, note if they are to add any more items to the cart then this pop-up does not display to avoid over-bombardment.
We love how
Native offers an awesome upsell pop-up, as soon as a customer adds an item to the cart they are shown the upgrade pop-up to upgrade with a discount, this has the potential to take a $12 sale to a $30 dollar sale. You can also consider using urgency techniques such as a limited time offer too.
The cart is also a highly significant area of an ecommerce website that can be used to influence a customer's order amount, right before they decide to checkout. Slide-in carts are firstly best practice when it comes to allowing customers customer to view what is in their cart without having to leave their page to go to a dedicated cart page. If you have a slide-in cart, then why not display product recommendations directly below the cart items, or have one-click upsells too? Brands that offer
subscriptions will often have a one-click to subscribe to an item in the cart to maximise the chances of converting a customer from a one-time customer to a subscriber.
Enhancing the checkout for average order value
The checkout experience is a great way to maximise average order value, you may think it's too late to influence customers at this point - think again! We've already discussed adding upsells to the cart slide-in or page, however, once a customer enters the checkout process it's time to begin recommending associated products. If you are a
Shopify Plus customer, then you can use
Checkout Extensibility to add product up-sells directly within the checkout or thank you page.
There are also a number of apps such as the
“Upsell After Checkout” that allows you to suggest a final cross-sell after the purchase is complete on the Shopify ‘Thank You’ page.
Alternatively, apps such as
Rebuy have pre-built checkout extensions that you can use to add product recommendations directly to your checkout experience for your customers.
Finally, it is worth considering adding an extra page between the cart and the checkout to ask customers if they were interested in any additional products, it is important to not make this process too long or confusing otherwise you risk checkout abandonment.
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