More Profit, Less Work: AOV Strategies That Work

Hey guys, welcome back to 5 Minute Friday. I have some quick tips today and I love these tips because average order value, in my opinion, is one of the most impactful things we can do to increase sales. Now, a lot of retailers get hung up on the idea of what were my sales this month. Well, sales are a lagging indicator. They tell us what happened and how we performed a month ago. Right. Because all the things we did a month ago led to the amount of sales we have now. Well, I would rather you focus on what are my leading indicators, what are the things, the metrics, the to do's right that I could be doing right now that are going to impact sales a month from now. And these tips in terms of increasing average order value are some of the most important because when we increase average order value, we need fewer orders to reach our goal and we need a lesser amount of traffic to reach our goal. Which tells me if I could maintain my traffic and maintain my conversion rate and just increase my average order value a little bit, I could be making a whole lot more with a whole lot less effort. And that, my friends, at the end of the day, is what it's all about. So let's talk about some quick tips to increase your average order value. First is you sell what you show. So if I look across your marketing channels today and I only see maybe three items that you've actually posted with a call to action to snag this in store, snag it online 24, 7, you're not showing enough. Or if I walk into your store and I'm only seeing items on a waterfall rack, not merchandised or layered, and I have to really kind of dig around to find enough things to check out. Or if I come to your website and I only have one thing in my cart, I'm not excited enough. So you only will sell what you show. So how can you suggest and how can you show more? Layering, merchandising, cross marketing and cross promoting and educating are all great ways to increase how to how much we are showing product. And again, the frequency in your marketing is absolutely critical. Using carousel posts or recap posts on Facebook, including things in live sales and then reshowing them again later. If I looked at the things that did not sell in your business, would I come across things and say, hey, when's the last time you posted this item on social media? And you would say, I don't know that it's ever been posted. Then you have a problem. Or once on a Tuesday, three months ago. Then you Have a problem. We should have a plan where our merchandise is getting shown multiple times across our channels because that customer needs to see things on average of 7 times in order to take action. So we've got to be able to show more of our product more often. So one way to think about doing that is layering and merchandising in apparel. My rule of thumb. And again, I worked at the Buckle in college and this was just like such a huge piece. There was a four piece layering rule. Anything that we had on a mannequin or on a front facing waterfall or on a display table, things had to be layered with an average of four pieces. So. So even if you look at the outfit I'm wearing today, I've got a base undershirt, I've got a vest, I've got about five necklaces, I've got all kinds of bracelets, I've got rings, I've got earrings. I would, if I was taking a photo, probably have a handbag and I would be holding a cup that I could sell in my store as well. So I am showing you at least 10 different things that you could buy at this given moment. If I look across your marketing and you're in apparel and your model only has on a top and some jeans, there's no styling, there's no belt, there's no layering, there's no jewelry, there's no bag, there's no cup, there's no candle, there's no feeling. Ah. What do I have to buy? Maybe that top at $35, what is that going to do to our average order value? Not much. I've got to give people multiple options. So you sell what you show. Layering and merchandising does that. If you sell home and gift, this is a major opportunity for you. When I'm coming into your store, no matter what you sell, I'm looking for you to solve my problems. And so if you're at home and gifts and I'm coming in and I'm going to host a bunch of people for Thanksgiving, I want to see a tabletop. I would love to see how do the plates go with the napkins, go with the gourmet food dip, go with the drinkware, go with the charcuterie boards that you're selling, how does that also go with some of the gift items or the jewelry or the candles or the scents that you also have? Any other decor items that you have? When I come into your storefront, I want to feel like I'm discovering this really cool Experience where all of these products work together. That's what great merchandising does. It doesn't matter what you sell. Merchandising and layering is critical in every aspect of retail. Now the other thing I would say, whether you're online or in store, to increase average order value is you've got to test and suggest. Anytime somebody comes into your space, I would love for you to say, hey, Sarah, guess what, we just brought this brand in, it's brand new to us. Would you test it out for us? I would just love your opinion on it. Maybe that's having them try it on. Maybe it's having them smell a candle, maybe it's having them physically touch a blanket. But you're testing and saying, hey, we just got this new thing. What do you think about it? Have them touch it or make an emotional reaction with it, right? By getting involved with whatever the product is. And that is quiet suggestive selling. So test and suggest. You're going to get more items in more people's hands more often. The next tip is to bundle. So again, I would love to solve people's problems in retail. That's what gets them, you know, coming back for more bundling is a great way to do that. Especially if you have items that maybe haven't been moving. Can you bundle them with a higher priced or maybe a newer or more exciting item to get some of the old ones out the door? Do you have teacher gifts? Can you bundle up graduation gifts? Can you bundle up stocking stuffers? Can you bundle up Mother's day items? Can you bundle up Father's day items? How can you make someone's life easier by having a pre made gift idea in a bundle that someone can grab and go with. Another great opportunity for average order value. If you have kids and you've shopped at Claire's, first of all, bless, you know, the experience of shopping with daughters and Claire's. But one thing they do so well is you get to check out and you've already spent a bloody hour looking at 45,000 different earrings and you get to the checkout and they're like, oh, did you know that it's actually like buy three get one free. And you're like, or no, buy three get one half off. Or just some crazy thing and you're like, what? Like I've got to go spend another hour looking for three more items so I can get my one thing half off. And your daughter's like, yeah, mom, let's do it. And you're like, pretty soon you've come home with like lip gloss and a mirror and some hair scrunchies and some blue light glasses and all the things you didn't need, Right? But your average order value went through the roof when you're in an accessories experience like that. So any kind of offer at checkout or where they can add on in an accessories category, which typically is a lot higher margin, is often a great opportunity. Now, when we're talking about online sales, one of my favorite ways to increase average order value is your free shipping margin. Free shipping should typically be about 10% over what your average order value is. If you have an average order value right now of like 75 bucks, I would want that free shipping to be at least around 100, right? You want to get people up over that threshold. If your average order value is around 50, I might have free shipping over 75. So play with that. To try to get people to add more items in the cart, you can install apps on your website that are a free shipping countdown. So once I have items in my cart, it's like, hey, you only have to spend nine more dollars to achieve free shipping. And girl math, your customers are going to do that. So let them. All right, finally, educate and solve problems. If you have an item that isn't moving, make sure you're showing it in an educational or a demonstration video. Show us how to use this candle and why it's different than the candle I bought at Walmart. Tell me about it in a video. If you're selling vests, show me 10 different ways I could style it. If you're selling jackets, show me 10 different ways you could style it. If you have tabletop decor gift, show me and educate me on how this thing solves my problems, makes my life easier, and how I can maybe use it with items I might already have. Because then it turns from a want into a needle. It makes sense for me to bring this into my closet. So solve people's problems. Educate them along the way. That's it for five Minute Friday. I hope you love these quick average order value tips. Let me know over on A.J. alderson. A.J. alderson. My name's not A.J. it's Ashley. Why did I even choose that Instagram handle? I don't know, but tell me over there or at the Boutique Hub. I love to hear what you guys are doing when you're listening to these podcast episodes. That's it. Have a great rest of your day and we will see you next time.