AOV matters! Here’s why…

AOV matters! Here’s why…

Average order value (AOV) is the average amount of money each customer spends on an order on your website.
Understanding the average order value helps businesses decide their marketing and pricing strategies.
By increasing this parameter, businesses can directly grow their revenue.
It not only gives you a shortcut to be profitable but also helps you shift your spends towards advertising and developing your product.

AOV is calculated using this simple formula:

AOV= Total Revenue/No. of Orders

Why must you increase your AOV?

So that you can extract more out of your customers at a given customer acquisition cost and increase your ROAS.
For instance, say you spend INR 100 on acquiring a customer who spends INR 150 on your website. This gives you a profit of INR 50. But, if you were to increase this customers AOV to INR 500, then that would increase your profit to INR 400 at the same acquisition cost of INR 100.
Here are a few simple hacks you can use to increase the average order value on your website:

1. Through Discounts – The simplest way to improve AOV is by offering discounts right when the customers are adding products to their cart.
A great idea is to keep a bracket of purchase within which customers can avail discounts.
E.g. If a visitor has added items worth 1000, then a message can prompt them to shop worth 500 more in order to avail the discount that one gets on purchasing worth a minimum order of INR 1500.
You can also use the same concept by adding a free gift instead of a discount.

Red free promotional badge vector

2. Returns and Free –Shipping – Just like the above point, you can also add a limit at which a buyer can avail free shipping and discounts. When a buyer shops below the limit he can be prompted to add more items to his cart to meet that limit and avail these benefits.

3. Social Proofing – Humans are easily influenced by other humans. By profiling a particular type of persona, we can induce shoppers to buy similar products. For example, when a person is viewing a particular product, the website can have a list of products (amongst the item currently being viewed) that other people have also brought. This exercise will convince the user of his choice and even encourage him to shop more of what others already have.

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4. Cross-Selling – This hack involves adding product suggestions to the page. Not just any product, but products that would complement and support what the user is already buying. For example, recommending a tan leather belt that would pair well with a white floral dress that a user is viewing.

(Image by Feedough via

5. Bundling Products – Similar to the above point. But with this hack, you create an entire look. This would make the buyer feel assisted while making choices and would help him think he was saving time.

Example: When someone views a beach top, show a bundled product that has that same top with a pair of shorts, hats, and sandals to go with.

(Image by Pinterest via

Monitoring AOV is crucial in attaining your marketing goals and not only helps you increase performance and sales but also helps improve a less monetary yet important parameter – customer experience.

If you wish to improve your AOV and translate higher sales for your business, get in touch with our team of Digital Marketing Experts who will guide you through this process.

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