6 Ways to improve Average order Value
As you know, Average order Value (AOV) measures the amount of money every customer spends per transaction on your eCommerce store.
One of the most important KPIs for any seller is to increase AOV. It is the most effective strategy to manage client acquisition costs while also reducing payback time and increasing ROI (Return On Investment).
This implies you can increase your revenues or spend more money on product development and marketing.
𝐈𝐧𝐜𝐫𝐞𝐚𝐬𝐢𝐧𝐠 𝐀𝐎𝐕 𝐢𝐬 𝐨𝐧𝐞 𝐨𝐟 𝐭𝐡𝐞 𝐛𝐞𝐬𝐭 𝐰𝐚𝐲𝐬 𝐭𝐨 𝐛𝐨𝐨𝐬𝐭 𝐲𝐨𝐮𝐫𝐑𝐞𝐭𝐮𝐫𝐧 𝐨𝐧 𝐈𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭 (𝐑𝐎𝐈).
𝟔 𝐰𝐚𝐲𝐬 𝐚𝐫𝐞:
𝟏- Optimize your listing
𝟐- Provide your customers with incentives like Promotions or Discounts
𝟑- Add Visual Elements in images and listing
𝟒- Present your product as an IDEAL GIFT
𝟓- Use Cross-selling and upselling tactics
𝟔- Build a Strong Social Proof for your product listing
𝐂𝐚𝐥𝐜𝐮𝐥𝐚𝐭𝐞 𝐀𝐯𝐞𝐫𝐚𝐠𝐞 𝐎𝐫𝐝𝐞𝐫 𝐕𝐚𝐥𝐮𝐞
Average order Value (AOV) = Total Revenue ÷ Number of orders
Let’s assume that your online store has generated a revenue of $1000 in the last month, and you have received 100 orders, then your AOV will be:
Average order Value = 1000 ÷ 100
Average order Value = 10
One significant aspect to note is that AOV is determined with the help of sales per order and not sales per customer.
𝐍𝐨𝐭𝐞:
AOV doesn’t factor into your profit margins or gross profit but it is still a vital metric for decision making.
AOV is directly co-related with keyword Ranking.
- Guide to PPC Campaigns on Amazon
- the Difference between ACOS, TACOS and ROAS
- Tracking Your Ads To Sales Ratio on Amazon
- Increasing Amazon products organic ranking
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