16 ways to improve Average Order Value during the holidays7 min read

Is average order value important? Of course, it’s a key metric that e-commerce brands should focus on during this holiday season. Increasing the average order value directly boosts your store’s revenue, increases customer loyalty, and retention and reduces churn rate.

How Does Average Order Value Influence Customer retention?

If a customer spends a lot on your website, it means that the customer trusts you, believes in your brand, and enjoys the experience that they’ve been receiving from the brand. When they’re satisfied with the post-purchase journey, and if they’re satisfied with the product that they have received, this will play a huge role in retention. Higher the average order value, better the customer experience and post-purchase journey, more would be the customer retention rate.

16 ways to improve Average Order value during the holidays

1. Offer product bundles

Product bundling is a well-known strategy used during the holiday season. Often complementary products are bundled together. Bundle the products that are often bought by your customers and present the bundle in a discounted price to increase the average order value of your cart. A popular type of bundling during the holiday season is the gift set. 

Gift Set during the Holidays
Gift Set during the Holidays

2. Add gifting options

Customers are shopping at your site often looking to buy gifts for their loved ones. Save them some time by offering gifting options. This gifting option can be a great way to save time for your customers, adding to a positive customer experience. You also get to brand all your products with your gift-wrapping techniques.

Gift Wrapping Option from Amazon
Gift Wrapping Option from Amazon

3. Try to upsell your products

Upselling is usually recommending a higher priced or a better version of the product that the customer is currently viewing. This can be achieved by comparing a product with its high featured model and rating them. .

4. Add-on options

Offering complementary products that would go with the original product that the customer is viewing, can be a great way to present an opportunity to increase the average order value of the cart. For example, for a customer who is purchasing a moisturizer from a beauty brand, the same beauty brand can recommend face wash and serum before the application of the moisturizer to get a clearer skin. Clothing brands often do this by a ‘buy-the-look’ option while shopping.

Enticing Customers to add more items to the cart

5. Influence through Post - purchase journey

An average customer visits the order tracking page 6 to 8 times during delivery. This rate could be significantly increased during the holiday season owing to higher customer anxiety. Use the post-purchase communication channel to offer coupon codes, offers and discounts on products that are personally recommended for the customer. This has proven to be a very great marketing opportunity.

We’re seeing customers increase their revenue by an average of 12% through post-purchase promotions. (Fanx)

6. Suggestions in Checkout

The last touchpoint a customer can be influenced before the sale happens is the checkout page. The checkout page is when impulse decisions take place. E-commerce brands can suggest personalized recommendations or complementary products during checkout. Customers are more likely to add those products to their cart.

Suggestions at Checkout

7. Try cross-selling

Cross-selling is the strategy through which an e-commerce brand recommends complementary products that go along with the product that the customer has chosen. This way, the customer feels very convenient and has a positive impression on the brand for recommending those products to them. Often customers might have forgotten to buy those complementary products and as a way of reminding that cross-selling acts as a way of reminding to the customers. Which also increasing the average order value.

8. Customise coupon codes

Customize and personalize the coupon codes according to an individual customer. Offer separate coupon codes for your loyalty members and first-time shoppers. Present thresholds for free shipping through customized coupon codes. For example, orders above $60 get free shipping with this ‘X’ coupon code. Present limited-time offers that last only for a few hours, to FOMO the customer into adding more items to the cart. 

9. Incentivise customers as soon as they enter your shop

Offer discounts and collect emails from the customers as soon as they enter the shop. SpinTheWheel is one good tool which would help you do that. It offers a gamified experience and also offers coupon codes. Collecting emails from customers if you want the tool to do so.

Spin-the-wheel Promo
Spin-the-wheel Promo

10. Discounts with Loyalty programs

Loyal customers are a gold mine and don’t ever go cold on them. Always send frequent emails and SMSs to keep your loyal customers in the loop of what’s going on in your e-commerce space. A customer who has shopped from you before has a high probability of buying high valued items from you. Frequent communication with them about new product launches and offers that are going on in your store would be a great way to make them shop with you again.

11. Show how much they’ve saved through your offers

This might sound weird. Remind your customers that they have saved X amount of dollars by using coupon codes and offers from the brand. This would reduce cart abandonment rates. If the customer knows that they still have budget to purchase another item, they will do so knowing that they have saved so much.

12. Offer Tiered discounts

Offer a tired discount. For example: .20% offer on 2 products, 40% offer on 5 products, 50% offer on 10 products. Such a tiered discount would make the customer add more items into your cart, increasing the average order value.

13. Offer Buy Now, Pay Later Option

Buy Now Pay Later (BNPL) is a popular payment method that’s been used by millennials and Gen Zs over the past few months. Your customers are shopping for their loved ones, and amidst inflation, they’re still willing to spend a lot on gifts. Offering multiple payment methods, especially Buy Now Pay Later, would give them the privilege to shop for products right now and not worry about exceeding their budget. This could give them a great customer experience also.

14. Display Social proof

When the customer has doubts about buying a certain product from you, social proof can be a great way to nudge them further into buying your product. This sets the customer expectation right and reduces the number of returns.

15. Levarage Personalised product recommendations

Personalized product recommendations are a great way to increase the amount of time, customers spend on your website. This promotes user engagement and customer retention. Customers often tend to discover new products on your website if they do so. This would significantly increase the average order value.

16. Show Abundance scarcity

Have you seen many websites showing data on ‘X number of people have viewed this product in the last two hours’ or ‘only four or five stocks left’ for you to purchase? This is the use of fear of scarcity to lure customers into buying a product from the brand.

Final Word

There are many ways with which you can increase your average order value. But some techniques work only at some point. If the customer clearly has a budget, then any number of tricks wouldn’t encourage them to add more things to the cart. They’d be more focused on saving money during this expensive season of the year. Strategize your pricing, keeping both the luxury shoppers and budget savers in mind. Of course, ‘one size fits all’ doesn’t also apply to increasing the average order value of every customer’s cart.