Discover Ways To Increase Average Order Value In Magento Stores

21 Aug 2014
You want to earn more revenue, right? There are several ways to boost your sales such as getting more customers, charging higher price, increasing repurchases, and increasing average order value. Depending on your business, the best way can be different. However, there is money on the table, if you concentrate on increasing average order value. Even with traffic fluctuations, your revenue maybe boosted due to higher value per purchase. Let’s discover optimization ways to increase average order value.

1. Free shipping motivates purchase

The advantage of shopping online is time and travel cost savings. However, freight cost might discourage people from buying a product. According to ComScore Study, free shipping is becoming crucial; 75% of customers will shift to another provider if shipping is not free.

Free shipping for all kinds of products is impossible. However, in term of increasing average order value by free shipping, there are several options you can consider as follows:

- Free shipping threshold: Traditionally, if customers purchase over the minimum order, they will get free freight cost.

- Flat rate shipping: It is not free shipping but it promotes people to buy more. If customers use flat rate, the quantity of products does not affect shipping cost.

- Selected item shipping: This is effective especially when you are running a bundle promotion. Instead of purchasing individual items, customer can buy a bundle to take the advantage of free shipping.

- Limited time free shipping: During a promotion, eg. Seasonal promotion, if you want to clear out inventory, you may try to bundle products and offer free shipping.

2. Up-selling and cross-selling

Up- selling is that you sell products with higher prices, whereas cross – selling is that you sell more products. If you are tending to implement up – selling and cross – selling in your Magento store, let‘s check out these tatics below:

- Don’t be pushy: Trying to sell products may make customer resent you. It is kind of like that you insist on inviting customers to open credit card when they come to open an account at your bank.

- Actively recommend: Don’t be pushy, but don’t be shy as well. Actively recommend value products to customers.

- Keep limited recommendations: Customers will be overwhelmed and confused with too many choices.

3. Free gift offer

Anyone like free gifts, hence, free gifts can be a great tool to increase average order value. The options to run free gift program is similar to free shipping such as basing on total shopping cart, bundles, etc. Urge customer to buy more when they check out with such a message as “Buy more 20$ to get a free gift”.

If you are running a Magento store, you can try our Free Gift Pro extension, which will automate and simplify the free gift program.

In conclusion, if you are trying to growth your business and already have competitive advantages, it’s time to consider increasing average order value. However, don’t try all ways at once. “Listen” to your business essence, take step one by one and measure your results. Especially, find balance between discount and profit margin. Finally, try out some Magento extensions to support your program.

 

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