- Hey, welcome to The Journey.
Today, we're going to be talking
about how to increase your average order value on Etsy.
If you have an Etsy shop or are setting one up,
you've been working tirelessly on what to sell
and how to sell it and are no doubt, absolutely swamped
with ideas about how to structure your offerings.
- Yeah, when you have an e-commerce store
you're always looking for new ways to convert customers
and increase your average order value.
So AOV for short.
Your AOV is pretty much what
it states, the average order value
of all the orders placed in your store.
- And by increasing your AOV, you will have more revenue
with the same number of customers.
And that's always a great thing.
To calculate your average order value,
tally your total revenue
and then divide that
by the total number of orders you have received.
- That's right.
And in this video, we're going to offer you tips
and strategies to encourage your customers to buy more
from your Etsy shop than they may have initially planned.
So let's talk about free shipping costs and implementation.
So customers are cost sensitive when it comes
to shipping fees.
I know I am, (laughs) and shipping charges are one
of the primary reasons for cart abandonment.
- I know the last time I was going on online shopping
I had exactly what I wanted in the cart.
And then I got hit
with an extra $10 just to ship it to my house.
And that was just an extra cost that I didn't really
have planned or budgeted, which actually made me end
up not buying in the first place and looking elsewhere.
- Or have you ever had the scenario where spend just
15 more dollars and it's free shipping?
It gets me every time
with my Nespresso pods order every month.
But the best approach is to offer free shipping,
once a certain order amount is met, this is true.
And then calculate the minimum order value,
to qualify for free shipping or come up
with a price tag for your products where free shipping
doesn't eat into your profits.
And this way the order amount is worth it
for you to pick up the tab
- And while displaying results for any search term
Etsy's algorithm considers free shipping to show results.
When you bear the cost of shipping
it invariably reduces the pricing than your competitors.
The reason is that their products
have shipping prices embedded in it.
Moreover, it works as a great promotional tool too.
- Now let's talk about cross-sell strategies.
Cross-selling is when you also offer a product
that is related to the product being viewed.
And a great example of this, is if you sell, let's say
ooh, wall art, I bought some wall art recently,
you could cross-sell frames are other hanging materials.
And since Etsy offers sellers an option
to include a hyperlink in the product descriptions,
it's an excellent opportunity to provide links of similar
or complimentary products in the product description.
- Yeah, and you have all the data
to know what your customers are buying,
including what they purchased together.
So really leverage that opportunity to put the links
of your most popular products or products that really belong
to the same buyer persona or items
they may not have thought they need
but they ended up buying in the first place.
- So let's talk about integrating add-ons
and personalization.
So add-ons can be as simple
as offering personalized lettering
on those shirts you offer.
Or how about offering other features
like different colors or fonts?
That's some great personalization there.
So customers can make your products their own,
all for an extra fee, of course.
- Ooh, and you can create bundles and discounts.
Everybody loves a nice discount.
But by bundling products that have a natural synergy
and yes, I used that word,
it just makes sense.
If you're selling craft supplies,
you can create a separate listing
and bundle a canvas, paint, brushes at a discounted price
than if they purchase it separately, à la carte.
And really don't forget about those quantity discounts too,
those ones that buy in bulk.
The more they buy the more they save
and just a extra incentive to want to tack
on a few more items to get to that next level of savings.
- Speaking of savings, let's talk
about developing discount codes.
Discounts, of course,
encourage customers to spend more
because you're offering them the opportunity to spend less.
I mean, I definitely am guilty
of this during the holidays, right.
I feel like everyone's trying to offer me a sale
and therefore, I should shop right?
Yes, no (laughs).
However, the more they purchase,
the more value they feel
they've gotten, just be sure to do your math
to determine the minimum order value.
Otherwise you'll end up losin' money.
- Yeah, I saved so much money
and I'm going broke this year.
But
(Emma laughing)
next up we have--
- How'd that happen Nealey?
- I don't wanna talk about it.
But let's move on.
Using time-sensitive offers is another great way,
but at the end of each year
really look at the next year's calendar
and set up your promotional dates
and discount codes for all the holidays ahead.
Do it early versus doing it the last minute.
You can also have those flash sales
and just unannounced sales, just for customers
knowing that they only have so much time,
24 hours, three days, 15 minutes,
whatever it might be just to take advantage of the sale.
- Let's talk about generous return policies.
Now the opportunity to return and exchange the product
invariably increases the conversion rate.
Also a more extended window to return the products,
the higher the conversion rate, which makes sense.
And create a policy that is clear and establishes trust
and takes the risk out of making additional purchases
on products that customers may be on the fence about, right?
And make your policy visible on each page.
Shouldn't have to go hunting for it.
For example, 30 day risk-free return policy.
- But the next thing you can really do
is add a social cause.
And these are really stories that resonate
with buyers that fulfill their aspiration and inspires
and motivates them to contribute
by donating a portion
of your proceeds to a cause that you care about
but also motivates the buyer to care too.
And because they're not only making a purchase
or supporting your business,
they're also making a contribution to that cause as well.
- Absolutely, I love a good social cause.
However, be sure to be transparent
about how, where, when proceeds will be donated,
and actually donate.
Also just like you did with the shipping costs
and those discount codes calculate
the minimum order value
to ensure you're not ending up in the red.
- Yeah.
- And the number one way
to increase your average order value is
to really build trust and credibility.
This happens with quality reviews
and testimonials necessary to build that legitimacy.
The fact is that customers spend more
with businesses that they can trust
because it proves that your products are high quality.
- Totally, and as the majority of the marketplaces
react positively to positive reviews in their search
result display algorithm,
Etsy's no different.
And therefore the more
the number of glowing reviews, guess what?
The more increased sales
- Yeah, and know your customers intimately
and market directly to them by virtue
of visuals, verbiage and on other platforms, you know
that they hang out on.
And without these final tips,
all other strategies will fall flat.
- All right, that's a wrap.
Now you have the blueprint
to increase your average order value
for your e-commerce store.
Be sure these strategies are visible on your site,
that you announce them on your social media accounts and
to your mailing list.
Be sure to comment below, subscribe to our channel and--
- While you're there ring that bell,
so you get these episodes first.
This is The Journey.
Now make some money.