On the Web : Supersize Me
Want to double your bottom line? Increase average order size by just 10 percent
April 2010 By Larry Kavanagh
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2. More Advanced Cross-Selling: If you're already doing the basics, step up to the next level by showing multiple types of cross-sells on the same page. These can include product groupings like "category top sellers" and "people who viewed this product eventually bought these." You also can have your merchandiser select complementary products (filters for a water purifier, for example). Recommendation engines like RichRelevance, Certona and MyBuys are great at increasing average order size.
3. Offers: Part of the purpose of an offer, such as "buy $50 or more and get some bonus," is to drive up the average order size. If you use this kind of offer, test increasing the threshold to receive the bonus. If you can get the dollar threshold up just by 10 percent without losing response rate, you likely have an easy winner on your hands.
4. Buy Several Products With One Click: Amazon offers a 32-gig iPod touch. But with just a click on that iPod's page, the shopper also can get screen protectors and a case. The math gets a little trickier here. If you offer a 20 percent discount on that extra $10 item from above, the shopper pays $8 instead of $10. But your profit increases from $4 to $6, $8 less the $2 in revenue given back as a discount. Merchants are willing to give up that extra $2 if it entices shoppers to increase overall spend.
5. Bonus Offers Based on Dollars in Cart: If you've ordered from Omaha Steaks, you've almost certainly been offered "special deals" to add to the order. You can't get the specials directly; you have to buy something first in order to be eligible for them. This technique translates well to the online world.
6. Product Ratings and Reviews: Many studies have shown that shoppers are significantly more likely to buy a product that other shoppers have given positive ratings — about a 40 percent boost over unrated products. You can make cross-selling more effective by displaying product ratings with them. PowerReviews recently came out with an "Express" product that allows small to midsize merchants to get this feature on their sites for as low as $80/month.
7. Products Previously Viewed: Your best customers can view 10 to 20 different products during one visit. Build a dynamic list of the products they've visited, and give shoppers a one-click way to return to those items. Do the same with categories they've visited. ROI
Larry Kavanagh is founder and CEO of e-commerce software-as-a-service developer D.M.insite (lkavanagh@dminsite.com).
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