Magento recently issued a whitepaper highlighting the importance of enhancing various components that go into boosting your Average Order Value (AOV), as this is one of the most effective and comparatively inexpensive ways to increase overall revenue and cash generation for a business. The paper highlights how taking measures to improve AOV can also strengthen the business against other market challenges.
At Exto.io, we would like to demonstrate how you can leverage our Magento 2 products with your existing structure to increase the average amount of purchase orders your customers place over time, improving your business returns and revenue.
WHAT IS AOV?
The AOV is simply a measure of how much money your customers spend, on average, each time they place an order through your online store. It’s a very simple calculation based on revenue divided by the number of orders, but clearly aside from the main headline figure, the data can be broken down further to provide more detailed insights into the business.
For example, AOV can be generated for a period before and during a particular sales event or marketing campaign; for different stores based in different geographical areas; or for different types of product lines. When taken together and analyzed over time, AOV provides a useful guide into the state of health of the business and can help predict customer response to particular merchant efforts.
WHY BOOST AOV?
In brief, boosting AOV is one of the most cost-effective ways to grow a business. It is much simpler to increase returns from existing customers than it is to gain more customers, especially for eCommerce markets where gaining additional customers can require substantial investment, time, marketing and advertising. If, alternatively, you can get existing customers to purchase additional items or more expensive items from your store, you can gain an increased return without having to incur these costs.
Separately, boosting AOV can help mitigate against fluctuations in business traffic – for example due to seasonal variations or unforeseen circumstances – as the increased average expenditure offsets against any dip in site traffic numbers. In addition, undertaking measures to increase AOV can make your business more competitive against counterparts operating in the marketplace and, given how fiercely competitive the eCommerce market is, any steps that can help gain an edge are important ones.
THE WAYS TO BOOST AOV
The Magento whitepaper highlighted five strategies that can be used:
• Product bundling, where multiple associated items are bought at once;
• Up-sell and cross-sell, where more expensive or additional items are suggested;
• Customer rewards, where customers are given an incentive to spend more;
• Personalization and Recommendations, where products are suggested to meet the customer’s needs; and
• Easy Returns, where having an effective returns system can mitigate against any worries a customer may have should their product need to be returned.
An overall combination of these is likely to have the greatest impact. Some, however, can be done using tools that are already available. Exto.io has several products that can directly help to achieve the increase in AOV and it is to these that we shall now turn.
INCREASING AOV USING MAGENTO 2 EXTENSIONS
Exto.io has produced a number of extensions for Magento stores that are specifically aimed to increase AOV, leveraging proven changes in customer behavior, given that around 90% of all buying decisions are made subconsciously.
MAGENTO REWARD POINTS
There is no doubt that reward and loyalty programs can have a major impact on your customers’ emotions and spending behavior. Reward and loyalty programs provide customers with an incentive to spend more – given that they get a reward for doing so – and help considerably with customer retention and increasing AOV. The Exto.io Magento Reward Points extension can help significantly with all of these. It also gives your business an additional selling point, offers a greater degree of brand recognition and can encourage greater secondary marketing by customers themselves, through their own discussions with other people.
The Exto.io Magento customer rewards extension gives you the following:
• CUSTOMIZED DASHBOARD FOR ENHANCED CONTROL
The dashboard helps you sift through numerous Magento indicators, such as how many customers are engaged in your loyalty program, points earned and redeemed, outstanding value of points issued and so on. The dashboard has an intuitive ‘one-click’ element that enables you to access key information and controls speedily, for example, having quick access to the active rules that trigger reward points.
• SETTING THRESHOLDS
You can easily set certain reward point thresholds. This means that you as the merchant can decide how many points will be awarded for which certain behavior on the part of the customer. For example, you can set the minimum value of products in a cart before points can be redeemed against it or the minimum number of products. You can also set the minimum number of points a customer must have before they are able to redeem them, the minimum number of points that must be used in redemption, and the maximum number of points that the customer can use during a day. All of this helps you keep the spending pattern of your clients under control and ensure that the overall aim of increasing AOV and your profitability is met.
• REFUND BY POINTS
Should a refund be required, you can choose to add reward points to a customer’s balance instead of transferring money back to the client’s bank account. This means that the customer will come back purchase an item using those rewards points. However, in this case, it can be best to allow your customers to choose how many reward points they want to spend and how much cash they want to spend and potentially give them a bit more discretion, as it creates a positive impression, is a good way to retain previous customers and a positive incentive for new ones.
MAGENTO RETURN MERCHANDIZE AUTHORIZATION
One of the most common concerns that online shoppers have relates to returns and potential problems that they may face in the returns process. Unlike a ‘bricks and mortar’ shop, the customer cannot just walk in to an eCommerce store and if they think that they will have to waste time and spend money returning your product, they are unlikely to shop from you or – at best – they will buy low value products and spend little money.
However, by keeping your return process simple and effective, you increase your chances of gaining that customer for life. Why? For the simple reason that they know that should anything happen, they will be able to return the product to you within the specified period with absolute ease and without paying anything. In short, they have confidence in you, the merchant, and your returns process.
The Magento returns management extension by Exto.io offers you the streamlined flexibility and power to do this and to simplify your Return Merchandize Authorization process. It provides a customer interface for agents to use where all the details are in one easy location. This can include the status of the request, resolution details and the data on the product the customer is returning. Having everything in one place prevents information being missed and mistakes happening.
The ticket view also includes the reason why the customer is returning the product along with other RMAs for the current order. As soon as the customer sends a return request, the system assigns the query to the relevant department and agent, automatically filling all the details and additional comments. This way, the administrators never lose a single ticket. Additionally, the system allows internal communications between agents, ensuring that if more than one has to work on the same return, all relevant agents are kept informed as to the progress of that ticket.
MAGENTO HELP DESK
Exto.io Magento 2 Help Desk will provide your customer support personnel with the tools and resources necessary to handle every single ticket in the most effective way possible. Your customer support agent can easily view each detail on a single ticket page, which will provide him with a bird’s eye view of the necessary information, such as:
• Client details;
• Reward points or store credit balance;
• Assigned order and relevant items;
• Full order history;
• Complete ticket list, and more.
Help Desk for Magento 2 offers a customized ticketing panel to absolutely nullify the need to constantly switch between several tasks. This enables the agent to work with maximum efficiency and to respond to the customer as swiftly as possible. Help Desk integrates fully with the RMA extension, providing a powerful tool to organize and store information.
Analytics is the bloodline of any successful company. Without analysis taking place – of the competition, of customer responses, of your own efforts – you are lacking essential insight into the business environment. You can conduct marketing campaigns but if you do not know who you customers are and do not understand how they will likely respond, you are likely to be wasting time, money and effort. With the help of Exto.io Magento 2 Analytics, you can develop a deeper understanding. You can examine data in multiple different ways, generating advanced reports, and use it to support your decision making.
Businesses that use streamlined analytics extensions are more likely to make quicker and more refined decisions. Using Exto.io Analytics customized dashboards, you can, for example, determine the impact of a new marketing campaign’s faster thus allowing you to tweak or change bits of it as needed. You can analyze the performance of your business any of its locations against a wide range of factors.
Our Exto.io Analytics extension includes:
• Total overview of sales as well as revenue;
• Abandoned shopping cart analysis;
• Highs and lows in your customer Average Order Value;
• Various types of reports, including “Sales by Attribute” and “Sales by Product”;
• Identification of “low performing” or “best selling” products;
• Analytical comparison of any two time periods.
The Magento whitepaper provides a useful insight into the importance of increasing AOV and illustrates some of the strategies that can be useful to help achieve this. Exto.io’s response to this has involved considerable analysis and careful evaluation, and our Magento 2 extensions are specifically designed to help you improve the AOV of your eCommerce business. Having been designed specifically for the Magento 2 system, these extensions integrate smoothly and swiftly, and require little specific training for staff, ensuring that the impact of the extensions can be seen quickly.