With the extensive growth of technology and the rise of online shoppers in India, the eCommerce business is growing at an unprecedented rate and the major brands are focusing more on enhancing their shipping delivery services. They are usually dependent on 3PL or Third-Party Logistics providers for outsourcing their shipping and logistics operations which gets even more complex and burdensome during festive seasons.

While the eCommerce business has experienced a boom, third-party logistics (3PL) companies have felt the effect too as holiday sales for eCommerce players reached a new high at $5.7 billion in 2022, as reported by Business Standard.

Festive seasons are the times when a surge in eCommerce sales is visible and companies try to increase their average order value. An important indicator for comprehending your customers’ purchasing patterns is the average order value, which determines the typical amount spent per order.

This comprehensive blog will briefly talk all about the average order value and its importance, and how to increase your average order value during the peak festive season.  

What is the Average Order Value?

The average order value is the typical sum that a consumer spends while shopping at your store. For instance, your store receives 500 orders every month and makes 50,000 in revenue. The average order value for your store is therefore $100.

A rise in the typical order value aids in:

• Increased sales without additional marketing expenses
• Enhanced customer lifetime value (LTV)
• Recovering the cost of customer acquisition
• Increased revenue
• Shrinking inventory

Average Order Value(AOV) is a crucial parameter for every eCommerce business to trace the pattern of their customer’s purchasing habits.

Tips to increase your average order value during peak season 

1. Boost your free shipping limit

Increasing the free shipping threshold is one of the quickest strategies to boost your average order value.

For instance, if you currently charge 500 for free shipping, raise it to 600. Make a jump of 20–30% of the existing order amount on average. As a result, if your average order value right now is $780. Then raise the $70 threshold for free shipping.

2. Leverage cross-selling

Cross-selling is the practice of promoting and making sales of complementary goods. Although they are related products, such as toothpaste and brushes, they are not similar products. The idea is to give the customer everything they need in one place rather than forcing them to shop at many outlets.

By offering what other customers have paired the product with and individualised suggestions based on user history, you may take this a step further.

3. Investing in a reliable 3PL partner

Optimizing your delivery plays a crucial role in enhancing your average order value which requires you to choose a reliable 3PL partner who can competitively handle and optimize your delivery services by using the latest technology in place.

NimbusPost is a cost-effective and reliable 3PL based in Gurugram, which provides tech-enabled shipping services with well-equipped warehouse and fulfillment facilities across the major cities in India, covering about 29,000+ pin codes. Their advanced dashboard features and prompt customer services enable you to easily use their user-friendly platform. They provide API integration with leading eCommerce marketplaces and 27+ courier partners, allowing you to conveniently choose the best possible option for delivering your products.

They also enable cross-border shipping, warehousing and fulfilment across 196+ countries.

4. Provide discounts on bulk orders

Offering substantial discounts on large orders is one of the best methods to increase basket size.

Showcase the cost savings of ordering in bulk. It’s comparable to wholesale orders when buyers receive additional discounts for making large purchases. The flexibility of these bulk purchases would raise the return on investment of the strategy. 

5. Offer personalized experience

Through carefully chosen recommendations, a personalised shopping experience can improve the client’s experience. In general, it makes it easier to navigate the website.

Depending on their search history, you can customise product recommendations. Depending on their website behaviour, you can provide them with tailored package offers. Based on the order history, you might potentially suggest product refills and repeat orders.

6. Establish trust and credibility

For online stores, establishing authority and credibility is essential. If customers don’t trust your store, they may not place orders or return them.

Provide concise explanations of the policies and place FAQs in various parts of your stores. To ensure reliability and security, use live chatbots and other customer care services. Although these factors have a significant impact on customer psychology, they have no direct impact on average order value. Simple elements like a dedicated domain name, client testimonials, and contact information can have a significant impact.

Conclusion 

To boost average order value, it all comes down to understanding your clients, segmenting them, and offering the right incentives. It serves as a window into the clients’ purchasing patterns. So, without incurring additional expenses, a greater average order value might bring in more profit and income.