Do you want to know if you’re running a healthy Shopify business? There’s a metric that tells you just that – the so-called Average Order Value or AOV.
That’s one of the most important metrics in e-commerce. It gives you the lever needed to grow your sales revenue without throwing money out the window while trying to attract more traffic.
To learn how, keep reading – AOV on Shopify stores and how to boost it is the topic of today’s article.
What Is Average Order Value & How to Calculate it?
The concept of AOV expresses how much, on average, a customer spends when purchasing from your Shopify store. You can use the built-in Shopify analytics tools to get a quick view of your store’s performance.
AOV tells you:
- What generates the most money and when;
- What trends can be identified on your Shopify store;
- Where the highest-spending clients are coming from;
- How customers behave;
- What drives them to add something to their basket;
- Where you should focus your efforts.
To get these insights, just get a number – the AOV formula is quick and easy:
What you should know is that different industries yield different AOVs. Read more on Average Order Value here.
For example, luxury and jewellery items generate the highest AOVs – around $180. Fashion and apparel AOV clocks around $126, whereas consumer goods have the lowest – around $37.
Plenty of tricks can boost AOV, and we’ll discuss them below. Keep those benchmarks in mind and consider your current Shopify store’s performance.
Identify the points and revenue streams you should focus on. Let’s see how!
How to Monitor Average Order Value?
One of the most important results of monitoring your average order value is identifying customer segments you can focus on and encourage to spend more. Not only that, but also those you should stop wasting time and effort on.
To do that, change how you think about AOV, regardless of whether you’re running a Shopify store. It’s not just the value that comes out of that formula. It can vary based on:
- Customer Segments – those you created through data and using customer data platforms. As a rule, when boosting AOV, focus on existing customers instead of attracting new ones. Identify the segments that generate the highest results, and encourage them to continue this trend. Analyze the rest, and develop proper tactics to increase their AOV.
- Acquisition Sources – identify the channels that generate the highest revenue. Those can be your email marketing or paid ads across social media. Since different channels require different tactics to get results, you can identify the ones worth investing more time and effort in by optimizing campaigns, messages, and offers. Additionally, you might be able to spot various objections people from different channels might have to buying more.
- Campaigns – not all campaigns are made equal. Your seasonal campaigns during the winter holidays or Black Friday will probably yield better results than your regular monthly promotion in June. You can sift out outlying campaigns and consider the AOV typical for your store outside peak moments. That can give you an overview of your store performance and insights into how to boost AOV on the regular.
To help you kick start this whole process, we’ve gathered ideas and strategies you can get inspiration from to increase AOV for your Shopify store. Don’t hesitate to check out the example Shopify apps that can help you.
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7 Strategies to Use Today
There are almost unlimited options and strategies to apply when striving to increase average order value. You’re limited only by your imagination and product type.
You know, not all promotions are suitable for every type of product.
Here, we’ll explore some of the most popular ways to boost AOV and how you can apply them to your Shopify store right now:
1. Upselling & Cross-selling Products
Would you like dessert? Would you like coffee with your dessert? Why not get a glass of white wine with that soufflé instead of the coffee?
A waiter can cross-sell and upsell you in the same breath. That’s also one of the most common strategies to boost AOV. With apps like VibeTrace, you can make relevant product recommendations for cross-selling and upselling on product pages or categories. You can use the app to send relevant recommendations via email.
Whether through an additional item or a higher-priced product, upselling and cross-selling are reliable ways to increase AOV.
Offer fillers with a notebook – if customers are ready to buy one, they’re willing to get the other. Offer silk instead of polyester curtains – offer higher value, not just in price but in quality.
What you must remember is not to overdo it. If you refused dessert, but the waiter kept pushing it, you’d be annoyed, right? Don’t annoy the customer.
2. Product Bundles
Product bundling provides a great way to increase average order value, especially for stores with cheaper items. Bundle several of the same product, maybe even offer a small discount on the bundle.
Alternatively, create a wholesome bundle – several items that go well together, for example, a bathroom kit.
Add a sponge, a silk hair towel, a pocket mirror, a bamboo toothbrush, and a silk scrunchie. Make that bundle an experience.
Or better yet – allow your visitor to create their own bundle out of eligible products. Shopify apps give you lots of freedom when you’re ready to provide bundling on your store.
If looking for Product Bundle apps on Shopify here’s a recent article on the topic.
3. Product Discounts
Discounts give you a way to increase AOV by simultaneously encouraging people to shop with you.
You can offer bulk discounts, coupons for buying product bundles, or when completing a higher-value purchase – let’s say, “Get 10% off if you purchase for $50 or more in the next 10 minutes.”
Additionally, you can provide discounts for repeat purchases if a customer buys more than a specific threshold. And speaking of those, let’s check out one of the oldest tricks in the book.
4. Free Shipping Threshold
Free shipping thresholds tie to specific order minimums and are easy to set up with Shopify. But before you choose the app for the job, consider that threshold.
Consider your current average order value and your average product prices. If you’re selling cheaper products and have an AOV of around $30, you can set a free shipping threshold around the $50 mark.
If you’re in the business of selling apparel or anything that comes with a higher price tag, place your threshold higher. Let’s say average prices gravitate around $30 or $50 per item. You can set a free shipping threshold of $80 or $100.
As a rule of thumb, you can set a free shipping threshold 20-30% higher than your current AOV if you have doubts. Remember, it must be easy to achieve for customers to care about it.
5. UGC & Social Proof
User-generated content and social proof give you a solid advantage when it comes to converting people. These:
- Demonstrate trust and make brands look reliable;
- Show how a product is used, sparking customers’ imagination;
- Give customers more confidence and help with overcoming objections.
That’s why it’s a good idea to optimize and enrich product pages with social proof like reviews, ratings, and UGC.
To do that, you can use dedicated page builders, choose a Shopify store theme that gives you flexibility when it comes to product pages, or use a suitable app.
6. Loyalty Programs
Loyalty programs are a go-to way to increase average order value of Shopify stores that offer consumables and products that people repurchase regularly. Think candles that burn out, or razors and decorative cosmetics.
People don’t buy desk lamps every month, but they get toothpaste and shampoos regularly. Reward them with points they can redeem with their next purchase or issue dedicated coupons and discounts.
A loyalty program will help boost AOV while supporting customer retention efforts and strategies. That way, you can build long-lasting customer relationships. That, in turn, affects both AOV and the customer lifetime value.
7. Buy Now – Pay Later
Another great way to encourage customers to spend more money is by giving them the option to buy now and pay later.
These can be the so-called payment plans that allow customers to spread costs over several months. Let’s say you’re selling unique, upcycled furniture that costs $600 per piece. Or shoes that come at $150 a pair.
Someone might be ready to buy from you but cannot immediately pay in full. There are two scenarios here:
- Wait and hope that the person gathers the money;
- Or provide them with the option to spread costs with a payment plan.
The best part? You can add it as an interest-free option, further encouraging customers in addition to providing an incentive to make repeat purchases. Shopify has developed its own app – Shop Pay, to assist retailers with that.
Best Shopify Apps to Increase AOV
| Strategy | Apps | Description |
| Upselling & Cross-Selling | VibeTrace | Grow revenues with marketing automation. Use the power of customer data and cross-channel communications. |
| Upselling & Cross-Selling | Bold Upsell | Make each order bigger and better with upsell offers on the product, cart, or thank you pages. |
| Upselling & Cross-Selling | ReConvert | With ReConvert, you can add one-click upsell, post-purchase upsell & discounted upsells to your checkout & thank you page. |
| Product Bundles | Bundler | Bundler allows you to offer discounts on your products when the customer purchases them together in a bundle. |
| Product Bundles | Wide Bundles | Create quantity breaks, bogo, or bundles on your product. |
| Product Discounts | ADG ‑ Discounts & Gifts | Helps retailers run automatic discounts, gifts with purchase, and various offers. |
| Free Shipping Threshold | Hextom: Free Shipping Bar | Displays progressive messages when customers put more items in their carts, and lets them know how much more to buy to get free shipping. |
| Product Reviews & UGC | Rivo | Instantly add social proof to your store by allowing customers to leave photos, videos, and feedback on their purchases. |
| Product Reviews & UGC | Stamped | Stamped helps you capture and showcase high-converting reviews & ratings, photos & videos, and Q&A. |
| Loyalty Programs | Growave | Growave – an all-in-one Shopify marketing app with powerful tools for reviews, wishlists, loyalty programs, gift cards, referrals, rewards, and UGC |
| Loyalty Programs | Rise.ai | Gift Card & Store Credit platform for eCommerce brands, with advanced solutions for Gift Card sales, Store Credit management, rewards, referrals, refunds, and loyalty programs. |
| Payment Plans | Shop Pay | Offer buy now, pay later with Shop Pay Installments. |
Why Boost Average Order Value?
The AOV is a sign whether you’re running a healthy Shopify business or there’s something left to be desired. Implementing creative and flexible strategies to help increase average order value is crucial to a successful retail business.
That impacts the overall customer lifetime value and, as a result – your bottom line.
Increasing AOV leads to:
- An immediate increase in profits and revenue;
- A better customer retention rate thanks to using incentivizing strategies that nurture a repeat-purchase behavior;
- A faster e-commerce growth that allows you to expand your Shopify business.
If you’re ready to apply AOV-boosting strategies, don’t hesitate to implement a powerful Shopify app like VibeTrace.
It helps you streamline your efforts and focus them on achieving better results faster.
