Contributions to Profit: How to Boost Your AOV
In a business model where many of us strategically lose money when acquiring new customers, cross-selling and upselling are critical to managing that loss. And these marketing techniques, if done right, can help speed your return on investment of acquiring that buyer in the first place.
Cross-selling entails selling a product that’s complementary to what a customer already is buying from you — something he or she also would have a clear affinity towards. Offering a customer a complementary item at the time of purchase is an art and science that can greatly enhance your average order value (AOV), increase your margins and help pay for the expense of generating that order.
Upselling entails convincing the customer to add another product to the order, or take a special offer (e.g., a discount, free shipping) just for increasing the order size.
Technology can simplify the cross-selling and upselling processes for you. Many order-processing and e-commerce software packages have a cross-selling/upselling component built in. If you don’t presently have it, check with your vendor, as this functionality could be included in a software update or sold as a separate module.
Cross-selling via the Contact Center
If you find that your software already includes cross-selling functionality, it may just be a matter of turning it on — that is, associating what products go together and then writing customer service rep (CSR) scripts. Rule of thumb: The closer the cross-sell item is to the original product, the more likely it is to be purchased. Have your merchandising staff select appropriate items, and test product offerings until you find the right combination. Once implemented in your contact center, the system will prompt your CSRs with built-in software scripting as part of the ordering process. With training, CSRs can become adept at gently steering customers toward cross-sell items.
Jim Gilbert has had a storied career in direct and digital marketing resulting in a burning desire to tell stories that educate, inform, and inspire marketers to new heights of success.
After years of marketing consulting, Jim decided it was time to “put his money where his mouth was" and build his own e-commerce company, Premo Natural Products, with its flagship product, Premo Guard Bed Bug & Mite Sprays. Premo in its second year is poised to eclipse 100 percent growth.
Jim has been writing for Target Marketing Group since 2006, first on the pages of Catalog Success Magazine, then as the first blogger for its online division. Jim continues to write for Total Retail.
Along the way, Jim has led the Florida Direct Marketing Association as their Marketing Chair and then three-term President, been an Adjunct Professor of Direct and Digital marketing for Miami International University, and created a lecture series, “The 9 Immutable Laws of Social Media Marketing,” which he has presented across the country at conferences and universities.