6 Useful Tips How to Boost Your Average Order Value

  •    Jana Podpleská​ is MonkeyData’s Content Specialist. She is an avid proponent of the eCommerce revolution.

Running your own business usually takes a lot of energy with little time for playing with analytics. Though it’s worth understanding them, small and mid-sized retailers need just a few key metrics to get the insights they need to make the right decisions, e.g. sales, a number of orders, and profit, which clearly defines how successful your business is.

Additional metrics can explain on a deeper level how your business is working and how effective your overall online marketing or pricing strategies are. Let’s take a look at one important metric that’s easy to measure and very valuable - the average order value - which can tell you more than you might think.

​​When starting your business you should find the best way to bring specific groups of customers to your online store, offering them products they need and support throughout the checkout process. All these activities can be analyzed based on average order value.

To calculate your company’s average order value, simply divide total revenue by the number of orders. For other segments just choose specific orders and related revenue. You can calculate it manually or use a smart analytics app that does it for you.

​Average Order Value = Total Revenue / Number of Orders

Besides the fact that higher AOV raises overall revenue, another reason to support customers increasing their order value is by reducing your order execution cost.

6 Tips to Increase Your AOV

Create a Threshold For Free Shipping

Every customer appreciates free shipping, which means that you have to calculate it within the overall purchase. But it also means that the customer is often willing to buy something extra just to get a discount or free shipping! Take your AOV and set the threshold 15-20% above.

Offer Promotions via Special Product Bundles

Image of Cross Selling

If a customer isn’t well informed, offering relevant products helps him or her choose what they really need. Imagine buying a professional camera. As a customer you just want to take beautiful pictures and you might not know that you need a better memory card, a bag so that you don’t break it, or a polarizing filter in order to darken skies or manage reflections. Create different product bundles according to the customers’ skill level. Using these tips you can increase the order from 1 to 4 items, and thus overall AOV.

Learn From Your Customers and Cross-sell

The other way to raise AOV is to recommend the best selling products with another specific product, or in other words cross selling. It’s usually assumed that accessories have higher margins than basic products; e.g. coffee machine and coffee pods. You may sell only three coffee machines per month, but sell coffee pods every day, thus these are where you want to gain your best margins.

Keep Your Customers Engaged via Loyalty Programs

Loyalty programs are an effective way to engage your customers. By making them feel like they belong to your community and reward them for purchases you’ll get valuable information about their buying habits which can help you to make suitable offers for specific groups of customers. They will have the feeling you really meet their needs and will be willing to spend more money. In fact, 70% of customers prefer shopping in retailers who offer loyalty programs. Don’t wait until they make the first purchase. Reward them with coupons immediately after registration, or for making recommendations to others.

Shopping Sprees Due to Limited Time Offer


People love special offers, especially when there is a time limit on the promotion.. Choose a favorite product or bundle of products and sell them for a special price, e.g. 40% less for two days. This will give your customers a sense of urgency and rapidly increase your AOV and revenue.

​Volume Discount Never Dies


This is a common, powerful trick but a very convenient one for both retailers and customers. Getting a lower price for more products is attractive to most shoppers. Offer a 15% discount when buying 5 pieces of one product and give advice on how your customers can use them - e.g. as a gift for their friends. Just be cautious and keep prices high enough that you will not lose the margin dollars on the product.

Whichever way you choose to increase your AOV, always keep an eye on the margins, especially when applying a discount. If you give a discount over your margin, AOV can attain the converse effect. Increasing AOV in this kind of case would lead to increasing your loss of money.