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5 Best Ways to Increase the Average Order Value of Your E-commerce Store


Learn how to make your customers buy more products and even more expensive products. Here are the 5 best ways to increase the average order value of your e-commerce store.


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Hey, do you want to know the easiest way to grow revenue from your e-commerce store?

Getting more traffic is not the answer! 😐

Well, increasing your average order value is the most efficient way to generate more revenue from your e-commerce store. This means you must learn how to encourage your customers to buy more products from your e-commerce store.

Today, we are going to discuss,

5 best ways to increase the average order value of your e-commerce business

If you don’t want to read any further, here is a list of methods that helps you to increase the average order value of your e-commerce store.

  1. Start, up-selling and cross-selling
  2. Create minimum order values for discounts
  3. Create loyalty programs
  4. Use bundle pricing
  5. Product recommendations

If you like to learn how to do this, keep reading! 🙂

Should you increase your average order value or try to generate more traffic to your store?

We all have been there. After some time running your e-commerce business, you might end up getting a static amount of income every month. When you see that your business is not growing anymore, you can quickly get frustrated.

Then, you will start pumping more money on advertisements to generate more traffic.

That will definitely work! But, yeah, then you would need to spend more money with your marketing budget 🙁

So, here I am going to discuss how to increase your profits using the existing number of customers in your business. We are going to learn how to increase the average order value of your e-commerce business.


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What is the average order value? (Or AOV?)

The average order value is the average amount of money that you are getting per single transaction.

For example, if you have made 400 sales in March and earned $4000, your average order value is,

 $4000/400 = $10

If your customers have bought more products per sale or bought more expensive products, you could have made $5000 from the same 400 sales.

So, your average order value could be,

$5000/400 = $12.5

In this article, we are going to discuss how to do this. We are going to learn how to increase the average order value of your e-commerce store.

1. Start, up-selling and cross-selling

The basic concept behind upselling it to convince your customers to buy something that can make their primary purchase more valuable and expensive.

It can be an upgrade or a more expensive version of it.

up-selling-in-ecommerce
Up-selling is encouraging your customers to by something more expensive

Cross-selling is suggesting and selling complementary products to primary sales. The customers can use these “related” products to have better user experience with their primary purchase.

up-selling-and-cross-selling-in-ecommerce
Cross-selling is suggesting and selling complementary products to primary sales

So, how do your up-sell or cross-sell?

It is an art!

Here we have a great guide to learn how to master the art of up-selling and cross-selling.

If you do not use any up-selling or cross-selling strategies with your business, you are basically leaving money on the table.

So, go ahead and start up-selling and cross-selling to increase the average order value of your e-commerce business.


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2. Create minimum order values for discounts

This is another great way to increase the value of an average shopping cart of your e-commerce business.

You can use different approaches to set minimum order values.

Here are some examples.

  1. Free gift for all orders above $100
  2. Free shipping for the orders above $100
  3. 5% discount for the orders above $50, and 10% discount for the orders above $100

As we have discussed in our dropshipping pricing strategies, by adding the terms “FREE” and “Discounts” creates some physiological tendency to purchase.

So, by setting a minimum order value for discounts and gifts, you can increase your average order value and boost your conversion rate too.

Check out below image from Old Navy, who nailed this point!

3. Create loyalty programs

Loyalty programs are basically a customer retention strategy. It won’t help you to increase the average order value for your business directly.

But, with loyalty programs, you can have more and more second time buyers.

Do you know that the returning customers bring in more profit than the first time buyers?

Well, this is true!

There is a cost involved with every single new visit you can get to your e-commerce store. On average, acquiring a new customer to your store is around 25 times more expensive than having a retaining customer.

Unless your e-commerce store is not ranked in the top for your niche, most of your leads are generated from paid ad campaigns. If you take this ad costs in the account, the ROI for your new customers can be smaller than for the returning customers.

Loyalty programs work well with consumable products, such as food, medicine, razor blades etc.

After some time, your customers will need to repurchase the same product. So, by creating loyalty programs, you can invite them back to buy again from you.

Old Navy uses a point-based loyalty reward system.

loyality programs - how to increase the value or an average shopping cart

You can pick a loyalty program that fits your business.

4. Use bundle pricing

Check out this image from Poshmark. The seller has created a bundle of products as a single product listing.

In the same way, you can choose complementary products and create bundle product listings.

Bundle pricing goes hand in hand with your cross-selling strategy.

5. Product recommendations

Do you know that 35% of the Amazon sales are generated through their “frequently bought together” option with the product listings?

upselling and cross selling
Amazon uses “frequently bought together” section to recommend more products

So, why don’t you give it a try and increase the average order value of your e-commerce business?

You can give the product recommendations right at the product listings, during the checkout, and even with after sale surveys.

Let us wrap up

Here we have discussed 5 simple, yet highly effective ways to increase the average order value or your e-commerce store.

You can encourage your customers to buy more, or buy more expensive products to make their shopping cart more valuable for your business.


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As final thoughts, during your process of increasing the average order value of your e-commerce store,

  • Do not distract the customer from making their primary purchase
  • Make it easy for the customers to take actions
  • The meal is the primary purchase, if you can increase the order value, that is just the dessert

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