A case study in how to improve page load speed

We used one of Littledata's own benchmarks to identify an issue with mobile page load speed and fix the underlying problems. Here's how we did it. Page load speed benchmark Using benchmarking in the Littledata app, we compared our website with 72 other marketing services sites benchmarked in December. (Our app lets you compare web performance by sector). Paying attention to both mobile and desktop experiences, we looked at things like the average delay before page content appears and the average time before full mobile page load. Overall we are above average, but against one benchmark - delay before page content appears - we are close to the median. That means 35 sites in our sector manage faster page load speeds. As website professionals, we can't let that rest! We care because Google cares about speed. If our landing pages take a long time before first 'paint' - before the content is visible - then more visitors will bounce or pick another article to answer their questions. If we invest time into writing articles like this one on our analytics blog, we should also invest time in making sure they are fast to load, and fast for Google to crawl and index. Here's how we acted on the benchmark data. [subscribe heading="Benchmark your site" button_text="sign up"] How fast were pages loading? We used the excellent PageSpeed Insights tool to pinpoint what was going wrong with the pages loading. Our original speed on mobile For mobile browsers, where traffic increasingly comes from, we were in the bottom 10% for speed, and below average for desktop. That sucks, and was definitely penalising our organic search rankings. Fixes to improve page load speed 1. Removing unnecessary JavaScript modules As a 'web app' built using Meteor, our pages are heavy with Javascript - effectively the whole site is pre-loaded with the first page. This means a module used by only one page can slow down ALL pages. By visualising the bundles for our Meteor App we found 2 very large modules which were blocking page load for all pages: the D3 library, used to visualise our industry category coverage, and the autoform package used for a single signup form. Using the clever dynamic imports feature in Meteor were were able to cut those modules from the landing page, and half the size of the Javascript bundle loaded from 1.6Mb to 0.8Mb. 2. Using Webp images for Chrome and compatible browsers Google prefers you to use the more efficient .webp image filetype, which is typically half the file-size of older .png or .jpeg filetypes. We found our chosen image server, Cloudinary, includes a simple feature to automatically chose the best file type for the browser it detects. Very quick fix! 3. Lazy-loading of landing page images Even if the images are efficiently served, trying to fetch all the images for a long-form landing page takes time - and is wasteful for users who only read the first few paragraphs. Instead, we can wait until the user scroll down before images are loaded for that section. This results in a small flicker as the user scrolls the first time, but faster initial load time. 4. Caching pages from our blog Wordpress is a great CMS, but the PHP + MySQL stack it uses is not the fastest for generating the pages. Luckily there are some great cache plugins, including WP Fastest Cache which we set up. What this does is save a rendered HTML file on the WP server, and only refresh the cache when the post is edited or new comments are added. 5. Cleaning up unused CSS and HTML templates Like all sites that have evolved their design and content over a few years, ours had lots of redundant code that no-one had spring-cleaned. Generally it's easier with older projects just to leave code, but for Meteor apps particularly it can slow down every page (see fix 1). So a new front-end developer starting was a good chance to rewrite templates from scratch, and chuck out the trash. The page load speed improvements Those 5 improvements, plus a database upgrade, let to some pretty good speed improvements - above average for mobile and top 2% for desktop speed! Even a few days after the release we saw a boost in the visibility of our landing pages in Google Search. Looking at Littledata's benchmarks for February, included in the newly released mobile vs desktop benchmarks, we can see the delay before content appears has dropped from 2.6 to 1.8 seconds (down by 40%). And the desktop speed is now in the top 10% of all sites at 1.7 seconds. The only area we still lack is the mobile page speed, so maybe we will look at some AMP versions in the next sprint. Ready to benchmark your site? Littledata's free plans include a Google Analytics connection and free benchmarks in ecommerce, engagement, marketing and site speed.

2019-03-13

The year in data: 2018 in ecommerce statistics

How did ecommerce change in 2018? Let's take a look at the data. Littledata benchmarks online retail performance in Google Analytics, and with over 12,000 sites categorised across 500 industry sectors we have a unique insight into ecommerce trends in 2018. The pattern we're seeing is that web sessions are becoming ever shorter as users split their attention across many ads, sites and devices. Marketers need get visibility across a range of platforms, and accept that a customer purchase journey will involve an ever greater number of online touch points. In the following analysis, we look at how performance changed across 149 ecommerce sites in 2018, and how these trends might continue in 2019. Ecommerce conversion rate is down Ecommerce conversion rate has dropped by an average of 6 basis points, not because of a drop of online sales - but rather because the number of sessions for considering and browsing (i.e. not converting) has risen. This is partly an increase in low-quality sessions (e.g. SnapChat ads preloading pages without ever showing them to users), and partly an increase in users from platforms like Facebook (see below) which bring less engagement with landing pages. See our mission to Increase Ecommerce Conversion Rate for more details. Revenue per customer is up Revenue per customer is the total sales divided by the total number of users which purchased online. The increase of $16 USD per customer per month shows that many stores are doing better with segmentation - ignoring all those sessions which don't convert, and retargeting and reselling to those that buy lots. The growth in subscription business models is also fuelling this trend. Getting a customer to commit to a regular payment plan is the most effective way of increasing revenue per user. See our mission to Increase Average Order Value for more details. Reliance on the homepage is down Content marketing became mainstream in 2018, and no self-respecting brand would now rely on the homepage alone to drive interest in the brand. The percentage of traffic coming 'through the front door' will continue to fall. In building out a range of keyword-specific landing pages, stores are harnessing a wider range of Google search queries, and providing more engaging landing pages from Google Ad and Facebook Ad clicks. Usage of internal site search is up Along with fewer visitors coming through the homepage, we are seeing fewer browsers use traditional category navigation over internal search. We think this is partly to do with younger consumers preference for search, but also probably reflects the increasing sophistication and relevance of internal search tools used by ecommerce. Referrals from Facebook are up Even after Facebook's data security and privacy embarrassments in 2018, it continues to grow as the 2nd major global marketing platform. Although few sites in our benchmark rely on Facebook for more than 10% of their traffic, it is a significant driver of revenue. As merchants continue to come to Littledata to find out the real ROI on their Facebook Ads, check back next year for a new round of analysis! How did your site perform? If you're interested in benchmarking your ecommerce site, Littledata offers a free trial to connect with Google Analytics and audit your tracking. You can see ecommerce benchmarks directly in the app, including 'ecommerce conversion rate', 'referrals from Facebook' and 'reliance on the homepage', to know exactly how your site's performing. Sign up today to benchmark your site and import Facebook Ads data directly into Google Analytics. [subscribe] For this article we looked at Littledata's private, anonymized benchmark data set, selecting ecommerce sites that had a majority of their traffic from the US and more than 20,000 sessions per month. We measured the change from 1st December 2017 to 31st December 2017 to the same month in 2018.

2019-01-28

What is the average Add To Cart rate for ecommerce? (INFOGRAPHIC)

Add-to-cart (ATC) rate is a great indicator of your ability to turn visitors into buyers. When people click the Add To Cart (aka 'Add To Basket') button they are showing real intent to purchase. There are lots of different things that influence this metric, from user experience factors to product selection, pricing, and merchandising. So what is a good Add To Cart rate? As ever there tends to be quite a lot of variation from sector to sector. Some ecommerce stores might be more prone to window shopping, whereas others are geared up for impulse purchases. For example, home furnishings sites have an average add-to-cart rate of less than 3%, whereas beauty sites achieve almost 7%. The average for ecommerce in general hovers around the 4% mark, so if your site is wildly below that number then this is an area worth spending some time on. After all, increasing add-to-cart rate is almost certain to increase sales. I've analysed data from Littledata's ecommerce benchmarks, which tracks more than 12,000 ecommerce sites. The infographic below highlights Add To Cart performance data for a number of sectors. How does your site compare? Download our Add To Cart rate infographic Are you on track to beat the benchmark in 2019? If you don't see your sector listed above - or even if you do - then sign up to Littledata for full access to ecommerce benchmarking data for more than 150 sectors. Joining is simple. It's just a case of connecting Google Analytics and then diving into the good stuff. We have dashboards for monitoring your key metrics, as well as ecommerce benchmarks and hundreds of optimisation tips via Littledata Missions, to help you improve your performance.

2019-01-23

How to increase Add To Cart rate on your ecommerce store

Add-to-cart rate is a pivotal indicator of your ability to efficiently monetise your website. But are you doing everything you can to optimise your add-to-cart (ATC) rate? When a visitor adds items to the cart (or ‘basket’), they are revealing a high level of buying intent. As such it is a critical step in the purchase process, and is something that you should try to optimise. So what affects add to cart rate? And how might you go about improving it? Let’s explore why this is a crucial ecommerce metrics and take a look at what affects it. How to calculate ATC rate The formula is straightforward: you just need to figure out the percentage of visitors who have added an item to the cart / basket. You can track this via Google Analytics, if you’re using the enhanced ecommerce plugin, or directly via your Littledata dashboard, if you want to cut through the noise. Why is ATC rate important? Add to cart rate is one of the main metrics to keep an eye on if you manage an ecommerce site. It tells you so much about your product selection, pricing strategy, traffic acquisition tactics, merchandising, and user experience. For example, a sudden decline in ATC rate following an increase in marketing spend may be the result of targeting the wrong type of visitors after launching a new ad campaign. Or, it may be that your pricing is out of sync with the market. Likewise, if you’re charging for delivery then shoppers may look elsewhere to save on shipping costs. These things can be quickly adjusted, but only if you’re keeping an eye on ATC rate, and can figure out what is affecting any decline in click rates. How do I know if my ATC rate is good or bad? The average ATC rate is around 4%, though beauty, travel and retail sites tend to perform better than that. You can compare your own performance vs your peers via Littledata Benchmarks, which tracks performance data from a sample of more than 12,000 ecommerce websites. If you connect Google Analytics you'll be able to see your own data alongside the market average. We use AI to determine your category, though you can manually override our selection should you wish to do so. The key things to get right Your inventory is probably the first thing you should analyse. If your visitors are looking to purchase something that you don’t sell, then it’s game over. You can’t expect these people to click the add to cart button. After that, look at the specifics of your product offering. Are you pricing products competitively? Some competitor research will help you to bring your pricing into line with the market average. You should also review perceptions of trust. If your site isn’t trustworthy then people won’t want to buy from it. Conduct some user testing to find out whether you’re sending out the right trust signals. Merchandising also plays a huge part in driving up ATC rates. You need to do a good job of selling, and not just the product in question but also related products and add-ons. Up-selling and cross-selling strategies can improve ATC rates, as well as a bunch of other ecommerce metrics. I’ve already mentioned visitor intent, and that’s something that is going to play a big part in whether people add items to the cart. Are you targeting people who are ready to buy, or people who are not so far along the purchase path? There are of course very good reasons for targeting both, and it’s important to think about ATC rate in the context of multiple sessions and an elongated buying journey. Finally, there are a whole host of user experience pitfalls to dodge, and some optimisation tactics to test... How does the user experience affect ATC rate? If we put the product / pricing / people challenges to one side, we can focus on some of the onsite areas to address. So how might a poor user experience cause problems for prospective shoppers? Well firstly, there’s the simple matter of findability. Being able to easily find products is absolutely essential. That means providing shoppers with intuitive navigation, strong scent trails, excellent onsite search tools, and the ability to sort and filter items. Then, when it comes to clicking buttons, there are all sorts of basic things to get right. Button optimisation is the science of enticing clicks through good practice and persuasion, but it’s also about making sure that buttons can actually be clicked (especially for mobile users). There’s also the gentle art of copywriting, which is a proven winner when it comes to the things you can easily test. Words are incredibly powerful and tiny changes can have a dramatic impact on click rates, and all sorts of other metrics. [subscribe] So what can I actually do to increase my ATC rate? You can work your way through the above areas when conducting an ATC rate audit. Let’s also narrow our focus towards the onsite experience, as I have some specific ideas to help you optimise your buttons. I will outline these below. These ideas are taken from our button optimisation basics mission, which is aimed at improving ATC rate. So then, here are some simple ways to quickly optimise your add to cart buttons. Be sure to check out Littledata Missions for more proven ideas to help you increase the key ecommerce metrics… and online sales. Test, test, test! 1. Add some 'bonus text' within or below the CTA Spicing up your CTA with an extra message around it can work really well. ShipStation uses this tactic with their landing page, as shown below: If you weren’t already tempted to start your trial, you might become more willing after taking the 'no credit card required' message into account. 2. Allow shoppers to add items to cart on product list pages On product listing pages the primary objective is to get the user to buy, not to read information. As such, you should allow shoppers to be able to buy directly from list pages. It will provide a fast-track to the checkout for anyone in a rush to buy. Make your list pages scannable and use contrasting colours for ATC buttons to improve visibility. 3. Create great micro-copy Optimise your micro-copy and CTAs to ensure they never fall on deaf ears. Use of power words in every CTA and super descriptive headlines. 4. Design a button big enough to touch Fitt’s Law states that the bigger a button is, the easier it is to click on. Simple, really. And it usually pays off: studies have shown that increasing a button size by 20% lead to a jump in conversions. Optimising for a mobile platform is a key part of this, as a comScore study found that consumers spend 69% of time shopping on mobile devices. Buttons need to fit inside the screen and be easy to read, before they can be touched. Buttons should be large enough to be clickable, without distracting from the value proposition. 5. Leave enough space between tappable links Mis-pressing is common on mobile devices, as evidenced by all of your embarrassing typos. You don’t want your customers getting frustrated that their finger keeps pressing an unwanted button or link, so ensure that they're a) big enough and b) there is enough space is left between them. 6. Keep conversion elements above the fold Peep Laja has stated that content placed above the fold grabs 80% of our attention. As such this is the obvious place to start when optimising the key conversion elements on your website. Meanwhile, an eyetracking study by Nielsen Norman group found that 102% more attention is paid to information above the fold, compared to that placed below the fold. Things to optimise at the top of the page include your primary call to action, buttons, navigation, basket, personalised content, and merchandising. 6. Lower the commitment (‘shop now’ vs. ‘buy now’) One A/B test compared conversions between three versions of a CTA, which were: “buy now”, “order now” and “add to cart”. The latter saw a significantly increased conversion rate (approximately 11%) in all three sites tested. “Add to cart” does not imply the act of kissing goodbye to your cash quite as much as the other variations do. A shopper may feel much more inclined to react positively to this lower level of commitment. 7. Place risk-reducing messaging next to buttons and CTAs The only way a customer is going to purchase your product is by making them feel comfortable enough to click on all the buttons that stand in their way. Copyblogger emphasises the importance of risk-reducing messages around buttons. It found that one small variation in text produced 34% more conversions than a version that didn't provide any reassurance. 8. Use "click triggers" adjacent to buttons and CTAs It would be great if every visitor to your site would follow your well-intentioned CTA and add things to their carts. Fortunately, it has been shown that this could happen more often if you provide a nudge or two. Nudges can be as simple as declaring potential savings should a customer buy your product during a sale. Other click triggers which can boost your site’s performance include ones which eliminate doubt, simplify the purchase process or provide some kind of guarantee. 9. Use a text call to action for your ‘add to cart’ button Many studies have shown that it’s better to use text within the button as a call-to-action, as opposed to an icon (though you can use both). One such test was undertaken by Fab, which replaced a small, icon-focused button with a larger, text-focused button. This simple test increased ‘add to cart’ clickthroughs by a seriously impressive 49%. 10. Use action words for button labels The language you choose for your CTA can have a real impact on its performance. Words like ‘get’, ‘try’, ‘go’ and ‘add’ are all well worth testing. Start your button optimisation mission today Littledata has a range of Missions to help optimise things like ATC rate. You can launch the button optimisation basics mission directly in the app! We’ll measure the results in your personalised dashboard, and will suggest a bunch of other optimisation ideas to help you improve overall ecommerce performance. In doing so you will also get access to all of the other lovely Littledata features and tools. What’s not to like?

2018-12-18

Average order value benchmarks 2018: how do you compare? (INFOGRAPHIC)

The holiday shopping period has us obsessed with one of our favourite ecommerce metrics: average order value (AOV). How does your site compare? A new infographic breaks down the stats. Increasing average order value usually has a dramatic impact on profits and ROI from marketing spend. It is also a gift that keeps on giving, as optimisation in this area is something that can deliver ongoing results over the long term. What does ‘average’ look like? Well, that’s going to depend on your sector, as well as the level of optimisation maturity reached by your peers. There’s not much point comparing the AOV of a small jewellery site with a large travel website. It doesn’t tell you anything meaningful. It’s more interesting to deep dive into your niche, and the good news is that we have some sector-specific ecommerce benchmarks to share with you, based on data from the 12,000+ ecommerce websites that have connected to the Littledata app. Below is a visualisation to show you some of our numbers (there's much more to explore within the app). Compare your own performance To see your own data alongside the industry averages, simply hook up your Google Analytics account with Littledata, and the app will show you how you’re performing relative to your peers (it’s free to connect). The app will also show you benchmarks for the other key ecommerce metrics, alongside AOV. No doubt you’re also interested in things like conversion rate, checkout completion rate, product list CTR, and so on. Are you benchmarking your ecommerce site in the best sector to help you increase revenue? We use the IBM Watson API and some smart logic to categorise websites automatically, though you’re able to manually override that should you need to do so. For example, you can compare against similar sized SEO-driven websites in your location, or look specifically at retailers in your vertical (eg. health and beauty products by subscription). [subscribe] Underperforming? We’ve got your back... There’s no need for panic if your numbers don’t look as good as your peers, as the Littledata app will recommend specific optimisation ideas via our new Missions feature. You can launch missions to improve your ecommerce performance and increase sales. I'd love to know what you've done to increase average order value. Do leave a comment below if you have tips to share. PS. Feel free to share this infographic, or include it in your own blog posts, as long as you include a link back to this post and our main website (www.littledata.io).

2018-11-30

Introducing Missions: actionable ideas to increase online sales

Over the past few months we’ve been working on a new feature for Littledata users. Our new Missions feature is a data-driven recommendation engine for ecommerce optimisation. The Missions concept is simple, yet powerful. First, you connect Google Analytics in order to see how your site is performing relative to the benchmarks in your sector. Then, if you are underperforming in any given area, the app will suggest some specific optimisation missions. Now, you might think that in 2018 the vast majority of ecommerce websites are serious conversion machines, but that’s simply not the case. Most websites remain woefully under-optimised and are leaving way too much money on the table. Checkouts are abandoned, users bounce before pages load, forms are left uncompleted, and so on. This is becoming a big problem, given the competitive landscape in many sectors. Acquiring new customers is increasingly expensive. A surefire way to make your marketing budget go further is to optimise your website, but where should you start? This is precisely where Missions comes into play: you launch individual missions and work your way through the suggested tasks to improve ecommerce performance, metric by metric. Missions: website optimisation made simple We’ve spent a lot of time researching optimisation techniques that have been shown to work for other companies. That’s not to say that they’ll definitely work for you, but proven ideas are usually well worth testing. We now have hundreds of actionable ideas, which have been clustered together into launchable ‘missions’. Missions are aligned to key ecommerce goals, such as increasing average order value, product list CTR, add to cart rate, checkout completion rate and conversion rate. Individual missions cover areas such as persuasion, merchandising, user experience, copywriting, pricing, CTAs, findability and trust. And since Littledata is good at measuring the little data, you’ll be able to see the results of your efforts within the app. Who should use Missions? Missions is for anybody that wants to optimise a website. It can be used by large digital organisations, SMBs and micro businesses. It is particularly useful for agencies with multiple clients, especially where there are recurring optimisation tasks over multiple websites. The ideas in each mission include guidance on who should be involved in implementation. Roles include ecommerce manager, web developer, copywriter, marketing strategist, and UX designer. [subscribe] How to launch a mission Start by connecting Google Analytics, so we can help you measure success and prove ROI. Once connected we’ll run a quick check to make sure your analytics setup is in good shape (the app will suggest fixes, if anything is awry). You can then compare your performance against your peers, to identify areas that are ripe for improvement. We’ll show you this at the top of your dashboard: By drilling down into each of the above categories you’ll be able to see the detail. As an example, let’s look at the main metrics in the ecommerce category. You’ll see your own data alongside ecommerce benchmarks from your sector (based on data from more than 12,000 websites). This makes it easy to compare and contrast performance. It looks like this: In the above example you can see that ‘add to cart rate’ and ‘conversion rate’ are both considerably lower than the norm. Both of these areas are ripe for improvement. Another metric in the ecommerce category is average order value. For this particular sector the average is $28, and while this particular website is doing reasonably well, it isn’t yet a top performer. Increasing AOV is one of the quickest ways of growing revenue, so we can launch the following mission: So, this first mission - ‘Average order value fundamentals’ - will help you to incrementally increase AOV. It includes ideas in areas such as product bundling, cross-sells, up-sells, wishlists, pricing strategies, personalisation, social proof, and so on. Here’s what the mission looks like - note that each tip can be expanded to reveal more information: You can work your way through the mission and implement (or skip) the ideas. Press the ‘mark as complete’ button to start tracking performance. Once you have done that we will start monitoring performance: Reach your goals, faster Missions should generate considerable - and provable - ROI for the SMBs, corporates and agencies that use it. Work your way through the missions to improve the customer experience, and remove the friction from the buying process. The first iteration of Missions is natural next step for Littledata. Our long-term goal is to develop Missions into an AI-driven optimisation engine for ecommerce teams. We hope you’ll join us for the ride. People trust Littledata to audit, fix and automate reporting. They also use our benchmarks to check and compare their performance, relative to their peers. And now, with Missions, digital teams can set about actively increasing ecommerce revenue. We hope that Littledata Missions will help you to fast-track your goals and KPIs. Give Missions a try today and shoot for the moon.

2018-11-21

Are you looking at the wrong Black Friday metrics?

Paying attention to the right ecommerce metrics can help you establish the best customer base and shopping experience for long-term growth. But many retailers still focus only on the most popular metrics -- especially during the online shopping craze of Black Friday and Cyber Monday (#BFCM). Over the next few weeks ecommerce managers will be obsessing over data, but which stats are the most important? Two popular metrics -- ecommerce conversion rate and average time on site -- may be misleading, so I recommend looking instead at longer-term benchmarks. Here's how it all breaks down. Littledata's ecommerce benchmark data now contains indicators from over 12,000 sites, making it an ideal place to get a realistic view of Black Friday stats. Last year we found that the impact on Black Friday and Cyber Monday was larger in 2017 than in 2016. Using that same data set of 440 high-traffic sites, I dove into the numbers to see how this affected other metrics. Metrics to avoid I think that overall ecommerce conversion rate is a bad metric to track. From the leading ecommerce websites we surveyed, the median increase was 30% during the BFCM event last year...but nearly a third of the stores saw their conversion rate dip as the extra traffic didn’t purchase, with this group seeing a median 26% drop. Some stores do extremely well with deals: four sites from our survey had more than a 15-fold increase in ecommerce conversion rate during BFCM, and nearly a quarter saw more than double the conversion rate over the period. But the real question is: will tracking conversion rate hour-by-hour help you improve it? What could you possibly change within in day? Another misleading metric is average time on site. You may be looking for signs that the the extra traffic on the holiday weekend is engaging, but this is not the one to watch. The time on site for visitors who only see one page will be zero, which will mask any real increase from engaged visitors. Where to focus instead Now, do you know what good performance on funnel conversion metrics would look like for your sector? If not, have a look at Littledata’s industry benchmarks which now cover over 500 global sectors. Littledata’s benchmarks also include historic charts to show you how metrics such as add-to-cart rate vary for the average retailer in your sector month by month. Next try the ‘speed’ performance page to see how fast a user would expect a site in your sector to be. If you see site speed (as measured in Google Analytics) drop below average during Black Friday trading it’s time to pick up the phone to your web host or web operations team. Then, are you tracking return on adverting spend for extra Facebook Ads you're running during the quarter? Ad costs will spike during the peak trading period, and you make not be getting the same volume of traffic conversion into sales. Here are some quick pointers. Facebook Ads. Littledata’s Facebook Ads connection will ensure accurate data, with a dedicated Facebook report pack for automated insights. Shopify. If you're running your site on the Shopify platform, read up on which metrics are most important for Shopify stores and check out Shopify's BFCM Toolbox for seasonal online marketing. Missions. Use Missions in the Littledata app to make permanent improvements to your user experience. BFCM may be over before you can make the changes, but customers will keep buying the rest of the year. For example, can you increase add-to-cart rate with tips such as highlighting faster selling items or recommending an alternative to out-of-stock products? So focus on some clearer metrics and I hope Black Friday brings you every success! [subscribe]

2018-11-19

How to increase Average Order Value (AOV) on your ecommerce site

Average order value (AOV) is a bona fide north star metric for Shopify stores, and ecommerce companies more broadly. Increasing AOV is a priority goal for ecommerce teams as it directly boosts revenue (and profits, if you’re doing things right). Growing revenue often requires retailers to acquire more traffic, but with AOV you can increase sales simply by convincing shoppers to spend that little bit more. AOV can be improved by adopting a number of proven optimisation techniques. Many of these have their roots in offline retail, where price, promotion, placement and merchandising all play a part in persuading customers to buy additional - or more expensive - items. We’ll get onto these tactics soon enough, but for now let’s start at the beginning. What is average order value? AOV is the average amount spent by customers when they place an order. To calculate AOV you divide total sales by the total number of orders (typically over a certain period of time). You can monitor AOV via Google Analytics. If you’re using Littledata then you’ll see it on your dashboard and in ecommerce report packs. Why is average order value important? AOV is one of the primary KPIs in ecommerce. It is a measure of sales trends and reflects customer behaviour and buying preferences. This insight can be used to optimise your website, pricing strategy, and guide decisions on what you choose to sell. It is also a good indicator of your ability to optimise ROI, as your marketing budget will go that much further if you increase AOV. It is worth investing time and money into moving the AOV needle, as it will create universal uplift. Implement the right kind of tactics - and technology - and we are sure that you will see some positive results, especially if this is an activity you haven’t yet spent too much time on. The results? New and existing customers are likely to spend more with you whenever they buy. Better sales numbers, bigger profits, and various additional benefits. Just like the other ecommerce KPIs, it is best not to view AOV in isolation. Related metrics include customer lifetime value (CLV) and customer acquisition cost (CAC), particularly for ecommerce subscription businesses. How do I know if my average order value is in good shape? Littledata has robust benchmarking data from a sample of 12,000 ecommerce sites. You can drill down by category and revenue to see how you compare vs your peers. For example, we analysed AOV across 379 medium-sized ecommerce sites in September and found that $123 is the typical amount spent. But average is relative - it very much depends on the sector. Start a free Littledata trial to see your AOV alongside the benchmark for your sector (we will show you some other juicy metrics and benchmarks too). It will look like this: Pretty cool, huh? If you happen to be underperforming in any area then our app will suggest some proven optimisation ideas to help you improve your store. Other stores have used our ecommerce benchmarks to grow sales, and we're confident that you will experience similar results. What affects average order value? Lots of things influence how much people spend when they buy from your site. Consider the last time you bought a higher priced item, such as a TV, laptop or mobile phone. More often than not there are upsells and cross-sells as you progress down the purchase path. You end up buying related items (mobile phone cases), upgrading your initial choice (256MB memory vs 64MB), purchasing add-ons (extended warranty), or clicking on a compelling product bundle (phone + case + warranty = 15% off). This kind of buying behaviour helps ecommerce teams to sleep soundly at night. It is to be encouraged. A real world example Apple is an absolute master of maximising AOV. Let’s take a quick walkthrough of one of its purchase pathways. First, we’ll select a Macbook Pro and will then see the following page, which invites us to customise our order. Add a little more memory and one item of software, and the order value increases by about 30%. Boom. Now let’s click the ‘Add to Bag’ button. We’ll progress to an ‘Essentials’ page. Yet more ideas to help us spend extra money. Think we’re all done? Not so fast. Click on ‘Review Bag’ and you’ll enter the checkout. Note the ‘Related Products’ that appear underneath the basket summary. Is it any wonder that Apple is valued at more than one trillion dollars? How can I increase my average order value? The million dollar question (or maybe a few billions, in the case of Apple). The researchers for our newest product feature - called Missions - have discovered plenty of ideas for you to try out. Littledata Missions provide step-by-step guides to help ecommerce teams optimise performance, and AOV was one of the very first metrics we wanted to explore. The following ideas are taken from our Average Order Value Fundamentals mission. There are a bunch of others in there to try too. Missions automatically generate based on your ecommerce benchmark data in the Littledata app (try Missions for free today). I’ll wager that at least one of the following will help you to grow AOV. And a super combo might seriously move the dial. Once you’ve optimised AOV - and there might be a ceiling - you can work on increasing purchase frequency, customer referrals, and then scale up your customer acquisition efforts. So then, here are 12 ideas to help you start to grow average order value... 1. Provide free shipping for orders above a certain amount Betterware grew AOV by 20% after introducing free shipping for orders above £30. M&S also provides free standard delivery for orders that exceed £30, as seen in the screenshot. A study by UPS found that 58% of consumers would add extra items to their cart in order to qualify for free delivery. As such this is a great way of increasing average order value. Free delivery is an expectation these days, so if you're late to the party - and concerned about margins - then a minimum threshold is worth testing. 2. Offer minimum spend discounts Much like introducing a free shipping threshold, you can provide a discount if the customer spends a certain amount on your site. Although it might seem to go against the goal of increasing average order value, setting offers such as this can tempt visitors into spending whatever is necessary to achieve the discount, because it appears like a deal. There are a number of ecommerce plugins to help with this. A lot of happy Shopify stores use the Product Discount app. 3. Make the most of up-selling Up-selling is the art of convincing prospective customers to increase their spend, typically by buying a more expensive item to the thing they're looking at. For example, in the screenshot below we can see how Amazon shows higher priced TVs to the one initially selected. By listing out the features side by side it may be enough to convince the prospective buyer that the next model up is a more attractive option. This is a sure-fire way to increase average order value, though it's not without its risks as you'll need to change the shopper's mind about something ("You don't really want that, you want this."). So be careful when experimenting with up-selling techniques. 4. Embrace cross-selling Amazon has attributed around 35% of its revenue to cross-selling. Not exactly small change. As such it is crucial to find a cross-selling strategy that works for your website. Cross-selling is the science of persuading customers to buy additional products related to the thing they’re about to purchase. For example, buy a camera and you might see recommendations for camera cases, bigger memory cards, battery chargers, etc. Adding items to the basket in this way is highly likely to increase average order value. However, it is important to specify which customers receive cross-sell offers. You should certainly think twice before cross-sells to customers who regularly return items. 5. Allow customers to use live chat A Forrester study found that there is a 10% increase in order value from customers who used the live chat function. The study also discovered that live chat helps to increase revenue by 48% per chat hour, and increased conversion rate by 40%. The business case for live chat would appear to be strong. Why is this? Mainly because customers like the immediacy - and familiarity - of chat. It has been reported that 73% of consumers who have used live chat were pleased with the experience. So, live chat is good for AOV, sales, conversion rates and customer satisfaction. What's not to like? [subscribe] 6. Show how others have enjoyed the product Average order value is 6% higher among shoppers who read reviews, compared with those who don't bother, according to a Bazaarvoice study. Positive social proof is incredibly powerful. It goes a long way towards encouraging people to progress to the checkout. Social proof comes in many forms, from reviews and ratings to testimonials and buyer videos. Make it highly visible at key points in the buyer journey, to build trust and reinforce the decision to buy. 7. Offer financing for high-ticket items Analysis by Divido has shown that sales can increase by 40% when high-ticket items are offered in monthly instalments. Your most expensive items are the ones which can be heavily responsible for driving up your average order value. If you offer customers the option to pay in instalments it can help you sell more of these higher valued products. For example, Goldsmiths offers shoppers 0% interest-free credit on purchases which total more than £750. This may appeal to people looking at items in the £500+ range - they might end up being tempted to spend more once they see the financing available. 8. Offer volume-based discounts Office supplies company Paperstone generated a 19% average order increase when a bulk discount deal was offered. As well as helping to grow AOV, strategic discounting can be great for clearing out excess inventory. However, remember that it is important to calculate bulk discounts very carefully. You need to offer deals that attract customers, but which do not hurt your profit margins. 9. Use dynamic retargeting to increase average order value Stella & Dot increased AOV by 17% after experimenting with dynamic retargeting, which allows ecommerce firms to show shoppers the right kind of ads during the shopping journey (such as product recommendation ads, based on their browsing behaviour or purchase history). This technology also recaptures lost sales from visitors who leave websites, by showing them personalised offers to re-engage them. 10. Send personalised emails OneSpot found that average order value increased by 5% upon the personalisation of emails. Simply put, customers are more likely to feel valued by your site if you provide them with messages that are relevant to their specific interests. Personalisation often starts at the customer's name ('Dear sir' won't cut it), but extends to the content of the email. If this is based on prior browsing and purchase history then you're more likely to engage the shopper, to reinforce - or complete - the purchase. 11. Offer a gift card or loyalty scheme By offering customers rewards for shopping with you, you’re likely to see an increase in orders, as well as an increase in the size of those orders. It has been shown that offering rewards for purchases 15-20% above average order size can increase the amount people are willing to spend. Encouraging big spenders to buy more frequently will also have the effect of increasing AOV. A study by BigDoor found that loyal customers make up 70% of total sales in some cases, so it is important to give something back to those customers once in a while. 12. Create product packages A case study into BaubleBar, a jewellery site, showed that average order value increased significantly when product bundling was offered. One pair of its earrings costs $30, but a bundle of three is just $48. This bundle screams “deal” to a customer. BaubleBar saw its average order increase by $22 in a matter of days. Bundling reduces cognitive load. If you can help shoppers avoid thinking too much then you're onto a good thing. Bundles can be viewed by visitors as a valuable deal, especially if they contain products which supplement the one they are already interested in. Packaging up items this way can be incredibly persuasive, particularly when you're offering a discounted price. They can also save the shopper time - no need to browse for add ons. Start the AOV mission today In summary, trying to increase average order value is worth the effort, and will be a gift that keeps on giving once you move the dial in the right direction. You can launch the Average Order Value mission directly from your Littledata dashboard. Our app will track your progress as you test ideas to discover what works best for your site. People trust Littledata to audit, fix and automate reporting. They use our benchmarks to check and compare their performance, relative to their peers. And now, with Missions, digital teams can actively set about increasing ecommerce revenue.

2018-10-25

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