If you need to boost your revenue in a hot minute - this post is for you!🤑
Why?
I’m talking about ways you can increase your Average Cart Total.
In my last post I explained the key numbers you need to track when it comes to sales revenue… One of them is Average Cart Total.
That’s because traffic X average cart total X conversions is basically the equation for your sales figures.
This is the number you want to increase: it’s what pays the bill, and keeps the dream going girl!
So in this post I am looking at:
- What average cart total is
- Why it’s important
- 3 quick things you can do to increase it
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Ok so let’s dive into Average Cart Total.
Average cart total (or order value (AOV)) is the average dollar amount for each transaction in your store. The calculation is basically to divide your total revenue by the number of orders. Or, to look at it super simply... what is the average that people spend in your store.
This is one of the numbers you get in your Shopify back office, and it tells you what your average sale is.
And if you can increase the average amount that people spend, you’ll increase your revenue. Smart, right?!
I can’t tell you how many times I get asked how to increase sales, get more traffic, increase revenue.
Well, my friend, there’s a simple solution! Just increase your average sales order.
Other ways to boost revenue can cost you money - like increasing traffic, or getting more sales...Each transaction has a cost, and so just increasing the number of transactions will also increase your costs.
Whereas, increasing your average order value when a customer is already buying from you - much more profitable.
Sweet, right?
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Ok so HOW do you increase your average cart total?!
There are lots of different strategies that may increase your average order value, and they are essentially different ways to get your customer to spend more: either by buying more than they had initially been shopping for, or for buying more expensive alternatives.
This could be overwhelming to cover everything- so I’m just gonna focus on my favorite 3:
#1 Free shipping threshold
This works great because honestly, who likes to pay for shipping?
That’s right, no one.
This won’t work for everyone, because some ecommerce stores always offer free shipping, and the cost is built into the product pricing structure so they don’t lose money.
Others offer a flat rate for shipping.
But the free shipping threshold looks like “Free delivery for orders over $X.”
The reason I like this is because if your average cart total is LESS than $50, you can set your free shipping threshold at $50, so that customers need to have $50 in their cart to qualify for the free shipping.
This can often work really well as they are buying more than they originally showed up to buy.
And if they love the new products they tried, they’ll come back too - double bonus!
It’s a bit of trial and error to get the balance right in your business but you need to look at what your average order is, what the cost of your items are to find the balance.
You can also get a super cool banner that counts down their cart total and how much they still need to spend to qualify for that free shipping.
And ideally, you want them to exceed the threshold, right? But your item prices can’t be so low and your threshold so high that your customers will never add that many items in order to meet the threshold.
But this is a great way to get that average cart total up.
Moving on….
#2 Offer payment plan options
Offering payment plans and finance options for higher value orders is a smart option too.
So many people can’t afford to spend a lot in one go, and so by making it possible to pay in installments can boost your average order value while also keeping the customer in your store and stopping them from going to other boutiques or suppliers.
I recommend always accepting regular credit cards via Shopify Payments, and Paypal, ALWAYS. Offering easy ways to pay is more about conversion rates, but payment plans are also a great way to increase average cart total.
So if someone can make a purchase of $200 but they only need to pay 25% right now... Ya feel me? Who could resist that option?! Carpe diem baby!
We love Sezzle, and they have a bunch of assets that are graphics that you can use to promote payment plans in your store. You can also customize your graphics - that’s what we do for our clients - but that’s a whole other conversation!!
So... last but not least...
#3 Upsell or cross-sell apps
There are some really cool apps that you can use to upsell or cross-sell by suggesting bundles or showing bundled products, or alternatives.
Cross selling is about pop ups offering some complementary products or a deal (“How about a cute bag to go with that dress you just ordered?”)
These pop ups can appear as they’re checking out, or even once they’ve made a purchase, to add something else to their order.
Upselling is about offering a more expensive product (“Check out our best selling sweater that’s only $10 more than the one in your cart?”)
- Pop Upsell (free)
- Frequently Bought Together ($6.99/month)
- Bold Upsell ($9.99/month)
- Personalizer ($10/month)
With Personalizer, you can use it free until the app has increased your sales by 5x the amount of the monthly cost of the app.
Whatever option you go for, make sure you’re broadcasting it ALL over your site so that you’re really promoting these deals to your customers when they’re shopping in your store.
And not just on your site! Make sure you’re shouting about it on social media, in your emails, and in text messages!
Get that message out girl!
And while you’re shouting out your message...
It’s time for a friendly reminder…
Don’t get overwhelmed.
Before you go getting super excited and trying all the things out there - and believe me there are lots of different ways to boost your Average Cart Total - I want you to just take one tip at a time, implement it, and test it.
Don’t get overwhelmed with all the fricking things you can do… Just start with one.
Boutique Revenue Calculator
One last thing to mention and that is that a lot of business owners don’t really know what their Average Cart Total ought to be in order to reach their revenue goals.
I know, right!! Unthinkable!
But it happens.
They just have a goal, and no real plan of how to get there.
But it’s super important.
Your revenue is a function of traffic, average cart total and conversion rate - and so that’s why I built this li’l tool ... the Boutique Revenue Calculator.
You can grab it at hotmesshustle.com/pages/boutique-revenue-calculator
(Or check out my video on conversion rates for a walk through.)
So you can have a play about with your numbers here and get a feel for what you’re aiming for.
Like maybe you need to really increase your average cart total to $50 (in which case make $50 your free shipping threshold, see what I’m saying?!).
So when you plug in your numbers, you can see how much revenue that will bring in.
The tool basically shows the interplay between average cart total, conversion rate, and traffic.
All 3 are the keys to your success, and you want to work on all of them BUT - when you’re making tweaks or you’re working on a goal, just choose one of these metrics at a time to work with!!
Remember though, you need the traffic. Even if you’ve got the best conversion rate in the world and you’ve got a juicy average cart total, none of it matters (and you won’t make any money) if you don’t have the traffic. And when you do have the traffic, the more you have, the more average cart total matters. It’s a multiplier.
But if you’ve got less than 1000 hits on your website every month, you need to get that up, my friend. That has to be your priority… And that’s what I’m going to be talking about next!
Final thoughts 💭💭💭
I’ll leave you with some final thoughts...
1. The first thing is to have a super clear returns policy.
This will help your customers trust you so much more, and that will make it easier to add a bit more to their cart.
2. And secondly, I’ve alluded to this throughout this post, but let me super clear about this: always be A/B testing what you do. For everything that you decide to do or strategy you want to implement - make sure you do split tests so that one audience sees one version, but another another audience sees an alternative version.
Monitor it over a period of time so you can see which performs better. Play around with one change at a time so that you can monitor the data and keep making incremental improvements to your site...
Tweak and test baby!