There are several ways to measure and increase the sales levels of a store, either online or physical, and one of them is to increase the average amount that my customers spend in the store; And since every product store lives in a constant search for ways to increase its sales levels, today we are going to see 5 ways to increase that AOV (average order value).
What is the Average Order Value or Average Invoice of a store?
It consists of dividing the income generated in the store by the number of orders received during that certain period.
Average Invoice (AOV) = Revenue / # of orders generated
So, if, as an example, you have $ 2,000 as income and 200 purchases were received, you get an AOV of $ 20 for each purchase.
This is something extremely valuable because it allows us to have an idea of how long to expect during the strategies that we want to carry out in the future within the store and to understand what good, bad, risky or safe options are. For example, if it is possible to know that to get one more client, we are going to require $ 25 dollars, with the AOV of $ 20 we can see that that extra client is not profitable.
Loyal customers and their AOV
Now, as we can see in our series of Blogs about the loyalty of our clients, it is always more economical to try to make an increase through clients who identify with our brand compared to those who do not consider themselves our clients or even have not made the first purchase.
When entering a client, the client always ends up in one of two possible options, finding or not finding what they were looking for. Therefore, it is less expensive for companies to increase sales through repeat customers or to some extent loyal to the brand. The loyal customer when he finds what he is looking for in the store considers the option of continuing to observe if there is something that catches his attention, but what distinguishes him from the first-time customer is that even when he did not find what he was looking for when he entered, he keeps visiting and in the same way look with the possibility of making a purchase.
Ways to Increase AOV
1. First time strategies (in a category or in the store): A certain discount or percentage is shown as an incentive, responding to the first time the customer consumes a certain product. By understanding the consumption patterns and the categories that our client has already consumed, an incentive is offered to them so that they also trust some other product that they have not yet consumed. For first-time customers it can be offered both for certain specific categories that are strategic to increase the value of the invoice or also for the global store. The disadvantage of making it global is that we lose control of the type of product with which it is going to be redeemed and therefore the possibility of choosing promotions according to their margin or profitability is lost.
2. Generation of interactions and experiences with the buyer: We are currently living during an economy of experiences; it is the company that decides whether to join through good experiences or wait for an eventual bad experience to keep its customers away from the stores. The loyalty of our clients is not obtained through better prices, it is obtained through the understanding of the Buyer Persona and considering not only what they buy but also the fact of what we can do to generate pleasant experiences. What is proposed is the generation of "Challenges" through social networks to win a product or good that is being sold. In this way, customers enter and continue to feel part of the brand, but at the same time they crave new customers to join.
3. Building a Loyalty Program: A loyalty program is one of the most effective and inexpensive ways to increase your average order bill. Offering rewards for completing certain actions, such as spending a certain amount, will encourage people to spend a little more in order to redeem the rewards. For this, it is particularly important to always do it with the focus on the company's Buyer Personas.
For products that people already need to buy again, a loyalty program is an effective retention strategy that can increase the customer's willingness to spend and thus the value of the order and the value of customer life.
4. Cross-Sell & Up-Sell: Both techniques consist of using the product that is being viewed by the client and turning around it, offering a product or service that may interest them.
In the case of Cross Sells, what is sought is that, as I already mentioned, having the client on the page of a product that interests him, generate options for products that are similar or that complement the product he was following in a particularly good way. buying.
Now, if we talk about Up-sales, most of these projections consist in that, by the nature of the product, whether it is an exclusive version or not, some type of extra payment can be sold on what the client already had in your cart.
Now if, understanding the concept and the implications of increasing AOV, it is important to mention that the strategies that are carried out to increase it are not exclusive in any way nor are they totally restricted to the fact that it is herself who decides what she wants to do with her future. Using the tools, we saw today, we increased our average store bill and therefore walked.