If you own a food and nutrition store, you might have noticed that people often buy one item at a time unless they need multiple supplements.
This is because constantly purchasing supplements can become undeniably expensive. However, for the purpose of health maintenance, people tend to buy products based on when they finish their current supply.
As a business owner, your goal is to be profitable in the long run. One effective strategy to achieve this is by offering complementary products that enhance the effectiveness of the item they are purchasing, even if it increases the overall cost. This approach encourages customers to try more of your offerings, which boosts sales.
To monitor and optimize this strategy, you can keep an eye on your Average Order Value (AOV), which measures the average amount spent per customer order.
This article will delve into the various factors that influence AOV, the benefits of a higher AOV, and provide a guide to help your business increase its AOV. Furthermore, it will offer insights into your niche industry and provide valuable information to help you succeed.
Overview Of Recent Trends In Food And Nutrition Stores
On average, 58% of Adults in the US take supplements, which is equal to an average spend of $96.49 according to Statista.
Considering the substantial population of the US, this creates a significant market demand for your niche, which you should leverage to your advantage.
Emerging Niches In The Food And Nutrition Industry
Indeed, within the food and nutrition industry, there are numerous niche markets that cater to various consumer needs related to health and wellness.
If you are considering starting a new business or looking to expand your existing one, exploring these niche markets can provide you with a wide range of options to choose from, potentially increasing your sales and customer base significantly.
Here are some examples of supplement niches within the food and nutrition industry:
Plant-Based and Vegan Supplements
With the increasing popularity of veganism and plant-based diets, the demand for supplements catering to this lifestyle has grown significantly.
In fact, 5%- 8% of Americans have started to follow a vegan diet, which is approximately 16 Million individuals.
This emerging niche includes supplements derived directly from plants that have been shown to be effective for vitamin intake and overall nutritional needs. Health consumers believe that plant-based and vegan supplements are cruelty-free and environmentally friendly.
Cognitive Health and Brain Function
As people become more aware of the importance of mental well-being, the demand for supplements that support cognitive health and brain function has risen.
As of today, many have been trying to deal with stress and anxiety. Other than that, consumers tend to try supplements to focus on their work without sacrificing their health with medical drugs.
These supplements often contain ingredients like omega-3 fatty acids, antioxidants, and nootropics, which are believed to enhance memory, focus, and overall brain performance.
Sports Performance and Recovery
Fitness enthusiasts and athletes constantly seek ways to optimize their performance and accelerate recovery.
This niche provides supplements designed to help with physical endurance, muscle growth, and post-workout recovery. Protein powders, amino acids, and creatine are common ingredients in these supplements.
Gut Health and Digestive Wellness
Digestive health has gotten a lot of attention lately, as people realize how important a healthy gut microbiome is for overall health.
This is due to sensitivity to various food intakes that a specific individual’s body cannot digest.
This niche offers digestive health supplements that include probiotics, prebiotics, and digestive enzymes to support a healthy gut and alleviate digestive issues.
Beauty and Skincare
Beauty supplements have grown in popularity as people seek to improve their physical appearance from within.
Current external creams, oils, and other products are not as effective as advertised and may take some time to work, so consumers are switching to this remedy.
Vitamins, minerals, and antioxidants are commonly found in these supplements, which promote healthier skin, hair, and nails.
Additionally, beauty and skincare supplements frequently contain collagen, biotin, and vitamin C.
Age-Specific and Gender-Specific Supplements
The aging population and increasing awareness of gender-specific health needs have led to the emergence of supplements tailored to specific age groups and genders.
These supplements address age-related health concerns and support hormonal balance, bone health, and overall vitality based on the unique requirements of different demographics.
Understanding Average Order Value For Food And Nutrition Stores
Understanding the emerging niches in this industry will guide you in deciding what to offer in the market.
If your business’s target goal is to increase its average order value or the total revenue generated from orders, you must comprehend your customers’ needs.
Certain consumers prioritize their physical health and may also be interested in supplements for beauty and wellness. Providing them with the best options tailored to their needs can help boost your Average Order Value (AOV).
Now, let’s explore the factors that influence your AOV
Factors Influencing Average Order Value (AOV)
Clearly, there are many factors that may affect AOV but the most common factors for a food and nutrition store would be:
Product Pricing: The pricing of your food and nutrition products can directly impact the AOV. Higher-priced items will naturally lead to a higher AOV, while lower-priced items may result in a lower AOV.
Loyalty Programs: Rewarding loyal customers with exclusive discounts or rewards for exceeding certain spending thresholds can result in higher AOVs as customers strive to earn those benefits. Because supplements are intended to be used continuously, consumers expect a brand to provide them with exclusive care.
Free Shipping Thresholds: Setting a minimum order value for free shipping may encourage customers to add more items to their cart in order to qualify for free shipping, potentially increasing AOV.
Product Quality and Reviews: Positive customer reviews and high product quality can build trust and confidence, encouraging customers to make larger purchases. Social proof is very important for them if products really worked effectively.
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Is Calculating Average Order Value Reliable for Food And Nutrition Stores?
You’ll easily identify if your business is getting a higher average order value. One reason could be the effectiveness of your upsells and cross-sells strategies or your satisfied customer decided to increase their purchases in your store.
Although there’s really no standard for this metric as it only calculates the average revenue you have from every customer and if you have a variety of products in your store with huge differences in prices then this metric may not be as reliable as it seems.
Nonetheles, average order is still a must-track metric to improve your business but to be sure you should track it alongside other related metrics.
Benefits Of Striving For A Higher Average Order Value
Increasing the average order value (AOV) can have positive effects such as:
- Cross-Selling Opportunities
- Encourages Bundling
- Increased Customer Engagement
- Positive Customer Perception
- Valuable Data Insights
- Improved Inventory Management
- Opportunities for Upselling Supplements
- Better Budget Allocation
Average Order Value Benchmark For Food And Nutrition Stores
On average, if you start to see an average order value (AOV) on your e-commerce website between $54 and $274, then it means that your performance in selling your products and services is good.
A decline to less than $40 may indicate the need for you to improve your processes, as it falls below the benchmark for a good average order value.
However, you shouldn’t always think negatively if you observe a low AOV and focus on it alone. If your product costs aren’t too high and you still receive a huge number of orders, it may appear that you have a low average order value, but you could still be gaining a good amount of profit.
Nevertheless, understanding the general benchmark can serve as a guide for you when deciding to add more variety to your business.
Guide to Increasing Average Order Value for Your Food and Nutrition Store
If you own a food and nutrition store and want to boost your revenue, increasing the average order value (AOV) is an effective strategy. A higher AOV means customers are spending more per transaction, which ultimately leads to increased profits for your business.
Here are some actionable tips with descriptions and examples to help you achieve this:
Live chat prompts
Use live chat prompts on your website to interact with customers in real-time. Trained customer service representatives can provide personalized recommendations, answer questions, and resolve issues. This human touch may encourage customers to investigate additional products, resulting in a higher AOV.
For example, when a customer adds a product to their cart, a pop-up chat prompt appears, asking if they need any assistance or product recommendations.
Time-sensitive promotions
Offer time-sensitive promotions and limited-time discounts to create a sense of urgency. Customers may be encouraged to make faster purchasing decisions and add more items to their carts in order to take advantage of the deal.
For instance, you can run a flash sale for 24 hours, offering a 20% discount on all orders above $50.
Offer reduced prices for product bundles
Create product bundles by combining related items at a slightly lower price than buying each product separately. Customers are more likely to choose the bundle as a result, resulting in a higher AOV.
For example. bundle a premium whey protein powder, a shaker bottle, and a box of protein bars together at a 10% discount compared to buying them separately.
Offer small add-ons to purchases
At the checkout stage, offer small, inexpensive add-ons to complement customers’ main purchases. These low-cost add-ons have the potential to significantly increase the overall order value.
For example. when a customer adds a protein powder tub to their cart, offer a sample-sized pre-workout supplement for a nominal fee. This encourages customers to try a new product while enhancing their shopping experience.
Invest in targeted email marketing
Segment your customer base and create personalized email campaigns that showcase relevant products and exclusive deals based on their purchase history and preferences. Targeted email marketing can lead to higher engagement and repeat purchases, positively impacting AOV.
Look for affordable and reliable email automation software, such as Vibetrace that offers a number of features that you’ll need for your campaigns.
For instance, you can send a personalized email to customers who have previously bought weight loss supplements, featuring new products specifically designed for weight management. Offer an exclusive discount for a limited time to encourage repeat purchases.
Conclusion
To wrap it up, the supplement industry is growing, especially after the pandemic, as consumers slowly understand the importance of maintaining a healthy lifestyle. Therefore for Nutrition and Food stores, you need to act now.
As a business owner, you don’t need to miss out on this time when many changes can happen over time. So keep track of the important metrics, such as Average order value, that will guide your business’s decisions.
Keep in mind to implement what works for your business and make a proper strategy that suits your business needs.
