Did you know that average customer spend is not just a business metric but a secret weapon for sustainable growth? Whether your business thrives online or in a physical space, increasing average customer spend is a tried-and-true path to boosting revenue.
In this article, we’ll unlock the power of conversion rate optimization (CRO) as the key to boosting the average spent per customer, and adding resilience to your revenue streams. By tweaking essential elements on your website through CRO, you can drive online purchases and increase your average customer spend.
Curious to learn more? Dive into the upcoming sections to uncover 11 practical strategies that effortlessly enhance order values, propelling your revenue to new heights.
What is average customer spend?
Average customer spend is a metric that tracks how much the average customer spends on an individual order.
To use a brick and mortar example, a restaurant owner may attempt to increase customer spend by trying to sell more expensive dishes. They might not want to raise prices across their entire menu, since that might cause fewer new customers to give them a try.
But, once customers are in the door, convincing them to spend more money can lead to a higher average order for each meal and more profit for the business (this is called upselling, and we’ll discuss it in more detail later on).
As a metric, average customer spend provides valuable insights into consumer behavior and spending habits, serving as a key indicator of a company’s financial performance.
How to calculate average customer spend?
Calculating your average customer spend is a matter of following a simple formula that takes both your total revenue and your number of orders into account.
You’ll need to gather sales data for a particular period, usually a month or a quarter, in order to tally up your total sales.
You’ll also need to count the total number of transactions during that same period. Then, you can simply divide the total revenue by the number of transactions to calculate your average customer spend.
11 ways to increase average customer spend
Ready to start boosting your average customer spend? Here are 11 ways to do it…
1. Discount reminder
Most customers will be more likely to make a larger purchase when they feel like they’re getting a good deal. However, you won’t be able to increase your average order value using discounts if your customers forget they have an active coupon to use!
Using a sticky bar, you can keep your discounts at the top of your customers’ minds with a reminder message that follows them as they browse. This will ensure that more customers actually use the discount codes they have access to, raising your average spend per customer.
Check out these great sticky bar templates:
2. New product recommender
Providing a personalized customer experience is one of the best ways to increase the value of your average transaction. Recommending new products to your visitors is a great way to encourage higher customer spend, but it’s even more effective if you can leverage customer data to recommend products based on an individual’s interests.
You can use one of OptiMonk’s smart product recommenders to gain more future sales for your higher-priced items by recommending them to people who are likely to be interested.
3. Exit reminder
Just about every ecommerce business owner will tell you that cart abandonment is one of the most significant challenges they face.
Exit-intent technology can help you tackle this challenge by detecting when customers are just about to leave your site and intervening with a popup message at the last moment. This is a perfect time to use a discount reminder message to reactivate these users and encourage purchases.
You can get these campaigns up and running in just minutes with one of these OptiMonk templates:
4. Category favorites
People tend to purchase products that are enjoyed by other people and have generated positive reviews. This is no less true for products with higher prices, which is why you can increase average customer spend by selling some of your higher-priced items as “category favorites” or “most popular in this category.”
Help your customers decide on higher-priced items with one of these campaign templates:
5. Dynamic shipping bar
A free shipping threshold is a highly effective way of encouraging customers to spend more money by making free shipping contingent on exceeding a certain order amount. Customers will usually add that extra item and spend a little bit more in order to get free shipping, which directly leads to a higher average spend.
A dynamic shipping bar communicates exactly how much more a customer needs to spend in order to unlock free shipping. Try out one of the templates below to dramatically increase average customer spend:
6. Upsell popup
Upselling is a crucial strategy for any business that’s attempting to increase average customer spend. It involves encouraging customers to buy higher-priced alternatives to a product they’re viewing (or upgrades on a base product).
A successful upsell offer will usually offer something of real value to potential customers, whether that’s an additional feature or a strong warranty program.
Promoting your upsell offer on a popup will ensure that all your visitors see and consider it!
7. Personalized cart saver
Struggling with visitors that abandon your website with items in their carts? You can provide them with personalized offers to convince them to make their purchase now rather than later.
You can offer higher-value incentives to customers with more products in their carts in order to increase your average customer spend. These targeted campaigns help you minimize your costs while maximizing your profits.
Check out some additional information about this high-impact strategy.
8. Personalized recommender
There’s not much point in recommending irrelevant products to your visitors, since you won’t end up with any additional sales and you’ll harm the customer experience.
Instead, consider asking your customers exactly what they’re interested in and then recommend products based on that information. You can also use one of these campaigns to cross sell by offering bundles of products based on the data you’ve collected.
Learn more about this focus here.
9. Promote loyalty programs
Customer loyalty is an important tool to help you boost the average customer spend because people are naturally drawn to loyalty programs that offer tangible benefits. When executed effectively, these programs can give customers a great reason to spend a bit more money in order to access these benefits.
For example, customers will often buy more coffee if there’s a chance to get a freebie as a result of a customer loyalty program. You can achieve great success among your loyal customers with a valuable offer like this.
Take a look at Starbucks’ loyalty program: you get a free drink when you collect 100 stars!
10. Bundle offers
Bundle offers combine multiple related products or services into a single package. Usually, the cost of items in a bundle will be reduced compared to purchasing each item individually. However, customers spend more when they buy bundles instead of just a single item, which means a higher average customer spend.
Here’s an example from H&M, where they offer mix-and-match bundles:
11. Limited-time promotions
Limited-time offers are designed to entice consumers to make a purchase by capitalizing on the fear of missing out (FOMO). The time limit creates a sense of urgency that pushes customers to buy immediately.
Here’s an example from Christopher Cloos:
Increase the sense of urgency by including a countdown timer on your popup:
How can businesses encourage customers to spend more without being pushy?
An online business can encourage customers to spend more without being pushy by offering personalized recommendations, creating a positive shopping experience, and providing value through loyalty programs or bundled deals.
Are loyalty programs suitable for all types of businesses looking to increase customer spend?
Loyalty programs can be beneficial for many types of businesses looking to increase customer spend. They work particularly well for businesses that have repeat customers, such as retail stores, restaurants, airlines, and online retailers.
However, the suitability of a loyalty program depends on the company’s specific goals and customer base. For example, service-based businesses or those with infrequent purchases may need to adapt loyalty programs to make them effective.
It’s essential to assess the target audience and business model to determine whether a loyalty program is the right strategy for increasing customer spend.
What are some key metrics to monitor when implementing strategies to increase how much customers spend?
When implementing strategies to boost customer spending, keep a close eye on several key metrics including conversion rate, customer retention rate, and customer lifetime value. These metrics help you tailor your approach and make informed decisions so you can more effectively increase customer spending.
Boosting your average customer spend is an excellent way to grow your business sustainably. Imagine every shopping cart bringing in a few extra dollars… that small difference adds up to significant profit increases!
With many of the tactics we’ve gone over, you can not only increase average customer spend but also improve the customer experience and build lasting loyalty.
The good news is that you can unleash the power of many of these tactics in just minutes with OptiMonk campaigns—all you have to do is create an account today!