EP172: How to Increase Your Average Order Value and Boost Revenue in Your Creative Business

In this week's regular season episode we're covering the powerful impact that increasing Average Order Value (AOV) can have on your bottom line with 15 ideas for you to try in your creative business.

I share my own experiences as an illustrator who significantly increased my AOV and sales by learning to bundle items and offer bulk discounts - among other tactics . You’ll learn how this simple shift can transform your business, no matter what you sell or what creative services you offer. It also happens to be kinda fun!

This is a great episode for creatives who...

• are looking for strategies to increase their AOV online and and in person
• are struggling to draw new customers but need to boost revenue

This episode is brought to you by our Premium Subscriber Community on Patreon and Buzzsprout

For a summary of this episode and all the links mentioned please visit:
Episode172: Increase Your Average Order Value and Boost Revenue In Your Creative Business

You can find Melissa at finelimedesigns.com, finelimeillustrations.com or on Instagram @finelimedesigns.

Chapters

• 0:00 Increase Revenue With Average Order Value
• 10:32 Increase Revenue Through Bundling Products
• 20:06 Maximizing Sales Through Upselling Strategies
• 29:18 Increasing Revenue With Strategic Discounts
• 39:01 Pre-Orders and Exclusive Access Strategies
• 45:12 Creating Customer Incentives for Increased Sales
• 49:43 Strategies to Increase Sales and Revenue

Transcript

Speaker 1: 0:00

This week's episode of the and she Looked Up podcast is brought to you by our premium subscriber community on Patreon and Buzzsprout. Their ongoing financial support of the show ensures I can continue to bring the podcast to you. Want to help out? Head over to patreoncom. Forward slash, and she looked up. That's patreon p-a-t-r-e-o-n dot com. Forward slash, and she looked up. That's Patreon P-A-T-R-E-O-Ncom. Forward slash and she looked up. There you can join the community for free or you can choose to be a premium supporter for $4.50 a month, and that's in Canadian dollars. Paid supporters get access to a monthly exclusive podcast episode only available to premium subscribers. You can also click the support the show link in the episode notes on your podcast player to support us via Buzzsprout, where you will also get access to each month's exclusive premium supporter episode. I can't tell you how much I appreciate all our monthly supporters. They are the engine that keeps the podcast running and they're a pretty cool bunch too. And now let's get on with the show.

Speaker 1: 1:17

Welcome to the Angie Looked Up Podcast. Each week we sit down with inspiring Canadian women who create for a living. We talk about their creative journeys and their best business tips, as well as the creative and business mindset issues all creative entrepreneurs struggle with. I'm your host, melissa Hartfield, and after leaving a 20-year career in corporate retail, I've been happily self-employed for 12 years. I'm a graphic designer, an illustrator and a multi-six-figure-a-year entrepreneur in the digital content space. This podcast is for the artists, the makers and the creatives who want to find a way to make a living doing what they love. Hello everyone, and welcome to another episode of the and she Looked Up podcast. As always, I am your host, melissa, and this week we are on the second episode of season six and, as I promised you earlier I can't remember if I promised it in episode one of the season or if it was in one of the Prep for the holidays episodes but today we're going to be talking about a really easy way to increase your revenue and your profits.

Speaker 1: 2:32

We're going to be talking about AOV, and if you're not familiar with AOV, you've probably heard the acronym. But if you're not familiar with what it stands for, it stands for average order value. If you are from old school bricks and mortar retail, you may be more familiar with the term shopping basket, average shopping basket amount. So that's the term we used when I worked in bricks and mortar retail, but today the more common usage is AOV, or average order value, to kind of reflect that. People are also shopping online as well as in person with an actual shopping basket. So that's what we're going to be talking about today.

Speaker 1: 3:13

If you're watching on YouTube, I am all bundled up. Gone are my tank tops. We went from like 30 degrees to 18 degrees and it is very chilly here on the West Coast and kind of wet and damp and feels a bit like November, not really September. So, yes, I'm all bundled up today and we're going to be diving into this topic. I'm really looking forward to it because it's one of my favorite things. It was one of my favorite things in retail to work on. It's one of my favorite things now as a small business owner to work on, and it can have such an impact on your bottom line. And the cool part about it is there's so many ways to increase your average order value, like it is really only limited by your creativity. And these are the business tasks that I love the most, the ones that where I get to combine my creativity with my kind of business nerdiness. So I'm really looking forward to talking about this today. But before we dive into all of that.

Speaker 1: 4:13

I do just want to remind you that we would love it if you would leave a review for the show wherever you are listening, so you can now leave reviews on Spotify and Apple podcasts. You can do it right in the app, so you know if you're enjoying the show. I would love it if you would leave a review. It really helps us get found by others Canadian creative women and women who are running their own artistic small businesses. So I would really love it if you could do that. If you're watching on YouTube, please give us a thumbs up or subscribe or share with your friends. Again, it helps us get in front of people. Leave a comment. Youtube is the one place where you can easily leave a comment about the episode. So if you have comments or questions, that is the place where you can leave them and I will see them and I can easily reply to you as well. So that is one of the things I do like about YouTube kind of makes it worth having to show my face. So that's one of the perks of YouTube. So, yes, we would love it if you could leave us some reviews and help us get the word out.

Speaker 1: 5:20

We also have our Patreon community, which we have both a free community where I leave links to interesting articles or pop in with other little topics. But if you are a member of our paid Patreon community, you also get access to an exclusive podcast episode every month and whenever you sign up to Patreon, you get access to the entire backlist of those episodes. Whenever you sign up to Patreon, you get access to the entire backlist of those episodes. And if you just want to sign up for one month and it's a lot less than the cost of a latte I bought a latte last week and it was $7.20. It's only $4.50 to join Patreon for the month and you can just join for one month and listen to all the old episodes and then unsubscribe and or downgrade to a free membership and be on your merry way. So this episode would not be possible without our Patreon and Buzzsprout subscribers. So to all of them, thank you so much. That is why they sponsor the show, because the show wouldn't happen without our premium subscribers. So thank you to all of you for helping us out.

Speaker 1: 6:27

Okay, let's move on to AOV, or average order value. So one of the reasons I love AOV is because it's a very simple way to increase your revenue and your profit without actually having to increase the number of customers you have. Finding customers is a tough gig. It is really hard. Social media used to make it quite easy, but we all know that social media makes it very difficult to get people to us. These days it's hard to get seen on social media. To get people to your own website, you have to be very good at optimizing yourself for SEO search engine optimization. It requires doing things like writing blog posts and making sure that you're using keywords correctly and that you have SEO optimized product descriptions and product titles all of those things.

Speaker 1: 7:23

Etsy also works with SEO. It's a different type of SEO than you would find in the search engines, but they still have their own SEO, and so it's important that you're using the right titles and tags and that you're getting the correct information in your product descriptions, that you've got your shop information filled out. All of those are important for SEO and you need to do all of those things to get seen. And the thing with SEO is it's never ending. It's its own algorithms, just like social media, and those algorithms are also constantly changing, so getting people to us is an ongoing challenge, of course, we've talked about in previous episodes how to get found by your ideal customers.

Speaker 1: 8:12

You can also use in-person marketing. You can use paid marketing, which is things like Facebook ads or meta ads, tiktok, all those types of things. So, yes, there's lots of ways to get people to you, but wouldn't it also be nice if you could just make more money from the people who already know and love you? Not to sound mercenary about it, but at the end of the day, we all need to eat, right? I don't believe in the myth of the starving artist and I try to make sure that all of you understand that you don't need to starve to be a successful artist. So in order to do that, we have to make smart business decisions so that we can pay our bills, and increasing your average order value is an easy way to do that. So I'm not saying you shouldn't be paying attention to SEO and driving traffic to your site. Absolutely, you need to be doing that. What we need to be doing is employing a number of these different strategies and tactics at the same time, but it can be very hard to focus and go all in on them at the same time, so sometimes we have to pick one that we work on and then, once we get that one up and running, we pick another one that we work on, and then we pick a third one and then we go back to the first one and we sort of rotate through them and make sure that they're all serving us well. So enough babbling about all of that.

Speaker 1: 9:33

Let's get into what we're here to talk about today, which is average order value. So to give you an example of how powerful this can be and we're going to use very, very round numbers here, because math and I'm doing this on the fly in my head but let's say that you have, let's say, yesterday you sold a hundred dollars worth of product on your website and you had 10 customers over the course of the day. So to figure out your average order value, we take the total number of sales divided by the total number of customers. So 100 divided by 10 equals 10. So your average order value was $10. That doesn't mean everyone spent $10. Some people might've spent 20. Some people might've spent five, but over the course of the day, the average order value was $10. You're making about $10 per sale on your website every time. Again, it's the average number.

Speaker 1: 10:32

So if you are doing about $100 a day in one day over the course of a 30-day month and for this example we're going to say that all months in the year have 30 days in them, but over the course of a 30 day month you're making about $3,000 in sales. Okay, because you're doing $100 a day times 30 equals 3000. So again, your average order value for that $3,000 is $10 a day. That's your average order value across your website throughout the year. So over the course of a year, $3,000 is $10 a day. That's your average order value across your website throughout the year. So over the course of a year, $3,000 a month times 12 months, you made $36,000 in revenue, with an average order value across that whole year of $10.

Speaker 1: 11:17

Now what if you could increase your average order value for the year to $11? So, by a dollar, your average order value goes up by a dollar over the course of a year. So now you're making. You still got 10 customers a day, but instead of spending $10, they're spending on average $11. So now your daily sales are hitting the $110 mark instead of the $100 mark. So 110 times 30 means that you are making $3,300 a month instead of 3,000. So you haven't increased your number of customers, but you've increased your average order value and it is resulting in an extra $300 a month. In an extra $300 a month Over the course of a year. That is going to equal an extra 300 times 12, $3,600. So you're making an extra $3,600 a year and you haven't increased the number of customers that you have. All you've done is increased the amount that each customer spends in your shop. So you've gone from $36,000 a year to $39,600. Is that right? So you're almost at $40,000. You've almost had a $4,000 increase in sales without increasing your traffic or number of customers. So that's an easy way for us to increase our revenue and our profit.

Speaker 1: 12:49

So, but how do we do this? And this is where the fun stuff starts. There's actually so many different ways. I don't even know if we can get to them all in this episode, but I'm going to try. We're going to talk about as many as I can squeeze in to our time here. One of the easiest ways to increase your average order value is to offer bundles, and this was a game changer for me. This is where you bundle your products together and sell them as a package, and there's so many different ways that you can do this, so one of the easiest ways that I found in my business.

Speaker 1: 13:24

So I am an illustrator and I make stationary items based on my illustration work, so one of my most popular items is stickers, sticker sheets in particular, and I have one particular sticker sheet that is extremely popular and people were it retails for $5. And so when people buy it, they were buying one sheet and spending $5. And I started to think like how can I get them to buy more than one sheet? Because it's still like you have to think of it this way Packing up one sheet of stickers is a lot of work for $5. Packing it, writing the thank you card, putting it in the mail, taking it out to have it shipped all that it's a lot of work for $5. So how can I get them to spend more? And so the very easy, obvious way was to create a bulk discount. So when they purchase one sheet, they pay $5 a sheet. If they purchase three sheets, they get a bit of a discount. If they purchase five sheets, they get an even bigger discount, and it worked like a charm.

Speaker 1: 14:38

Almost nobody buys one sheet of that particular sticker sheet anymore. Most people buy three sheets or five sheets, and my average order value for that item has gone from just over $5, because I would occasionally have somebody buy two sheets, but most people bought one. So my average order value for that item went from just over $5 to now almost $13. I don't have any more customers for that to now almost $13. I don't have any more customers for that, but the people who are buying it are buying more and I'm making more money, and so the average order that I'm packing and shipping, instead of being a $5 order, it is now anywhere from a 13 to a 15 or $16 order, so that's a huge increase in revenue without increasing the number of customers that I have.

Speaker 1: 15:26

So are there any items that you sell that you could do something like that, where you are bundling them and offering them a bit of a discount? And the cool thing is like I did the math, because I'm kind of nerdy about this, but I did the math to see, like, what kind of discounts I could offer based on how much they purchase, and I worked it all out and even giving them a discount with five sheets, I'm actually making more per sheet than I was when I was selling one sheet at $5. Because I am not having to pack individual orders, I'm saving on the amount of packaging that I'm using for the number of items that I am making, and it takes me less time to create three sheets than it does Like. It takes me the same amount of time to create three sheets as it does to create one sheet. So, like when I factored in the making and the packing and the shipping time, I'm actually making more money when they purchase. I'm making a greater profit margin when they purchase five sheets at a discount than when they purchase one sheet at full price. So do the math on these things. I think you might be very pleasantly surprised. So that's one way that you can bundle, and once I saw that that worked so well, I started to do the same thing for my other stickers, and I'm still working my way through my whole sticker catalog and implementing that on all of them, cause it's it's a lot of work to do on Etsy and then you have to do it again on your Shopify site or wherever else you sell, so it's a slow process. But now any new product that I launch automatically has that discount done. So that's one way to do it.

Speaker 1: 17:08

You can also bundle different products together. So this is a great way, particularly for people who are shopping for gifts. So I used to work as a cosmetician and you know, when you go to the perfume counter or like one of the makeup counters just for Christmas, they always have those box sets that are only available at Christmas the gift sets, where you get like a little bit of everything you get. If you're buying perfume, you'll get the perfume, but you'll also get like a lotion and a toilet water or like different things, and it's at a very reduced price. You get a really good deal on it and people buy those for Christmas presents.

Speaker 1: 17:51

You can do something like that. So you know, if you make jewelry let's say you make earrings could you make a necklace that matches and box them together as a gift set. You could even add in a bracelet and have a whole matching trio and of course with each one the price would go up a little bit, but overall they might get a discount for buying three. And here's just a little pro tip you don't even have to give a discount when you bundle things together. Sometimes you can just take the straight up retail for each item, add it all together and sell it as is, because what you're selling isn't. What you're selling is convenience. You're making it easy for a person to go. That is a great gift idea, or oh, yes, I want those earrings, but I also want to have a matching necklace and a matching bracelet. So how can you bundle items together and sell them? It is such an easy way to increase your average order value.

Speaker 1: 18:47

If you sell bath products, you know, could you bundle. You see this all the time. You get like a bubble bath and a cleanser and a scrubby or something they all come together. If you sell candles, could you sell like a teaser set of candles? Like maybe, instead of selling full-size candles, you sell tea lights or something that come in your five most popular scents and you put all of them together in one box and sell it as kind of a sampler set so people can try them. You could also do this with large candles too, is have put your three most popular scents together in one box and sell it as a gift box. Or come out with seasonal scents that you package together in a bundle. So for Christmas, maybe you have like a candy cane scent, a pine scent and a spiced scent and you bundle those together as your Christmas scents and sell them in a box, like, think about how you can do that with what it is that you sell. What is it that you could put together, what is it that you could sell multiples of, and box them up, sell them like that. It's a really simple way to, um, increase your average order value.

Speaker 1: 20:06

The next thing this is another one that probably almost all of us are familiar with, and that is the. Would you like fries? With that way of upselling. So we are all familiar with the whole, or at least if you're of a certain age and you worked at McDonald's, you or any fast food outlet, there was always the. Do you want fries with that? Somebody orders a burger. Do you want fries with that? Somebody orders a burger. Do you want fries with that? Somebody orders a drink. Do you want fries with that? Or they order a burger and fries. Do you want to drink with that? Like it was always upselling them to increase the average order value or the shopping basket.

Speaker 1: 20:42

Then the fast food places got really smart and they decided to bundle things. So now you get your extra value meals or, where they've already bundled it for you, you get your drink, your fries and your burgers all together, and it's cheaper than buying them all separately. And you also get a bigger size. Movie theaters are experts at this. You go to the theater and if you buy the small popcorn, it costs you like $10, but if you buy the medium popcorn, it costs you $11. So you get all this extra popcorn for an extra dollar. It's brilliant, right, and we all are suckers for it.

Speaker 1: 21:17

So how can you introduce upsells and add-ons to this? So there's a lot of different ways that you can do this and you really have to think about how you can do it. So let's say you make jewelry. Would you be able to add on a custom engraving? You know Apple does this all the time. You buy an iPad. Do you want your name engraved on the back? Could you do that with jewelry? Do you want your name engraved on the inside of the ring, if you're able to do that? Or, as I mentioned, when they go to checkout, they're buying that pair of pearl earrings. Is there something that can pop up at checkout? And this is hard to do on Etsy, but you can definitely do this if you have your own website. Almost all of them have an upsell plugin or an upsell tool that lets you do this, so that when they add pearl earrings to their shopping cart, they are automatically suggested a matching pearl necklace or a matching pearl bracelet or something along those lines.

Speaker 1: 22:22

If you create a number of items in a specific pattern like, let's say, you make cute accessories from fabric that you make. So like if you're an illustrator like me, maybe you do pattern or surface design and then you have your patterns and surface designs turned into fabric and you make stuff out of the fabric to sell. So you know, somebody buys a scrunchie in your candy cane pattern but you also make a book sleeve in a candy cane pattern or a makeup bag in a candy cane pattern. When they go to checkout with that scrunchie, why not have something pop up showing them other items in that pattern? They've already shown you that they love the pattern. They're buying the product, so all you need to do is put in front of them other items in that pattern or that match or that go with that item. And there's ways that you can tag your products in your website so that the pop-up, so that the plugins or what do we call them in Shopify apps the apps that we use in Shopify can automatically and easily identify products that match and that go together.

Speaker 1: 23:35

So think of the different things. If somebody, every time you create a product or you list a product, think about what else you sell, that would make a great add-on for that product and then set your site up accordingly. And if you don't have something, that would make a great add-on. That is a really great way to do product development. What could I make that would be a great add-on for this item and then make a note and see what you can do for it. I would strongly recommend that for all your best-selling items that you have something in your product lineup that can be an add-on for those. Those are the items people buy the most. So you know the 80-20 rule. You go with that. The things that people buy the most, those are the ones you automatically want to have a way to upsell them to something that works really well with them. So what else? The next item on my list is tiered pricing. So I kind of talked about this with my stickers. Tiered pricing is where you the more you know it could be, the more they buy, the bigger the discount they get. But it can also be.

Speaker 1: 24:45

This is a great one for creative service providers is to have different packages that people can buy. So let's say, I'm going to use my favorite example of a wedding photographer, because I think everyone kind of understands this example. But if you're a wedding photographer, you might have different tiered packages with a different cost at each package. So you have your basic wedding package. This is for, you know, the budget conscious bride who wants photos but doesn't have a huge budget to work with. And so they want the basics. They want to have specific shots, certain number of shots and a certain number of extra add-ons that they can get with that. Then you have your mid tier pricing, where they get a little bit extra stuff, and then you have your premium pricing, where they get the whole bit extra stuff. And then you have your premium pricing, where they get the whole shebang, um, a ton of extras.

Speaker 1: 25:35

And we used to do this in um, in the blogging world, content creation, when we were working with sponsored uh, with brands. We would have tiered packages and we always used to kind of joke that the where you want them to purchase is the medium package. You want the medium package to be the one that kind of checks 90% of their boxes. Um, you know you always want to have that budget package because there will always be somebody who needs that budget package and you don't want to price yourself out of helping people who you know you could serve really well. So but you want most people to be in that mid-range package.

Speaker 1: 26:13

That's what you're aiming for. You want that mid-range package to be just juicy enough that people considering the basic package are gonna be like, oh, if I just could find another $100 or another couple hundred dollars, I could get so much extra stuff. It's like that movie theater popcorn right, the small is $10, but the medium is $11, and you get so much more when you buy the medium. And then you're going to have your premium package, which is going to have a ton of stuff. This is the deluxe, gold, medal, platinum package. That has probably a lot of stuff that most brides are not and grooms probably are, like you know that would be really nice to have, but I really just don't want to spend the extra money on it Because, again, you're trying to drive them to that mid-range package. But there will always be somebody who wants that premium, ultra, platinum package. You will sell them. You won't sell a lot of them, but you will sell them.

Speaker 1: 27:18

So the mid-range package is your bread and butter, but you have these packages on either side. That can make sure that you have good price points for all your potential customers. So that's a really easy way, and, of course, the packages are always going to be cheaper than buying all of those items a la carte off of your services menu. So, um, you know, that's what. That's what we're aiming for. It's another form of bundling, um, so tier pricing can be super effective. It's a. It's a great way, particularly for those of us who offer creative service providers. So, whether you're a photographer, um, a graphic way, particularly for those of us who offer creative service providers. So, whether you're a photographer, a graphic designer, a content creator, all those types of things, there's a place for tiered packaging for most of us.

Speaker 1: 27:59

Another option for increasing your average order value I think we're on number four now. Yes, number four on the list is providing a gift option. So this is where you might offer an additional service for people purchasing something as a gift. It could be gift wrapping, it could be customization, it could be writing the card for them. In the greeting card world where I am, there are people who sell cards and who will write the card for you, address the card for you and if you are mailing the card to somebody in the country that they're in, they will put the stamp on it for you and they will put it in the mail for you for an extra fee. So you can buy the card on their website or on Etsy and never actually receive the card. You don't need to write the card out, you don't need to mail the card. They will do all of that for you for a fee, of course. Same with gift wrapping. You know how many places have you been where they offered a gift? Wrap it for you? It's an extra three, five dollars, depending on the size of the parcel. Often that's a great way as well. If you want to support a charity, you can put the gift wrapping fee towards a charity. So if people purchase from you, you can offer gift wrapping. That $3 goes to your charity of choice.

Speaker 1: 29:18

Okay, next up on our list, this is number five, offering limited time discounts on higher priced items. So this is another way to increase your average order value. So this is another way to increase your average order value If you've got some higher end items that maybe you don't sell as often because they are higher end or they cost more, do you have the ability? Have you priced them appropriately so that you can offer a discount from time to time? Again, with discounts you have to be very careful because you don't want to train your customers to expect discounts, unless that's your business model. But I think for most creatives and artists and makers, that's not the business model most of us want to have. But if you can create a situation a couple of times a year where you do offer a discount on those high-end items that you make, times a year where you do offer a discount on those high-end items that you make, so, um, you know, if you're an artist and you sell originals and prints, um, maybe your originals go on sale once a year, uh, you have like an in-studio sale where people can come in and they can purchase. Instead of buying a $25 print, they're buying a $500 original but you're giving them a 10% discount, so it's going to be $450 instead of 500. So that's another way that you can increase your average order value.

Speaker 1: 30:41

Next up on the list, number six, is creating a subscription or a membership service. So subscriptions are a fun way that a lot of creatives will do this. So offer a subscription box. So this is where they sign up. Your customer signs up to receive something once a month or once a quarter or twice a year I mean the length of the timeframes of the subscriptions are completely up to you. But the idea is that it creates a guaranteed monthly income because they are and I'm just using monthly, because most subscription box services do tend to be monthly so you are getting guaranteed revenue every month once that person signs up for that subscription for whatever timeframe six months a year.

Speaker 1: 31:24

But it's also a way to add more products into the box than they might buy on their own. So you might have somebody hit your website. In my case, maybe they're looking for a birthday card. They buy the birthday card. It's $7 or whatever they cost on my site I don't even remember right this moment. They buy the birthday card one and done. They've spent $7. But if you could sign them up for a greeting card box every month or every quarter and in that box they get three cards or five cards of varying types. So you know, you want to make them probably kind of generic or maybe they have a seasonal theme to them. So they get Christmas and holiday themed cards in November and they get lovey dovey cards in January, that kind of thing. You can charge more because they're getting more cards. You can still give them a bit of a discount because they're buying them together in a box, but they're spending more than $7. Instead they're spending $30 a month. So you turn that one purchase into a recurring $30 monthly purchase. That's going to have a big impact on your average order value and there's all kinds of different ways that you can do subscriptions.

Speaker 1: 32:44

I've seen so many people do them. We had Deb Wong on the show. I will put a link to her two episodes because they're two of our most popular episodes, particularly the one we did on how to start a subscription box. But she sells tea. She does a tea. She used to do a tea subscription box. She doesn't do them anymore because she's focused, I think, more on her bagged tea as opposed to some of her other items that she used to sell. But she had a very successful subscription box.

Speaker 1: 33:13

I've seen people do it with greeting cards. I saw one a few weeks ago. Somebody did it with bookmarks. They're an illustrator and they do a bookmark of the month club kind of thing, where people get a new bookmark every month or they get a series of bookmarks. I've seen people do it with candles. I've seen people do it with candles. I've seen people do it with bath and body products. There's so many different ways and when I know a lot of us get very excited when we're asked to put an item in a subscription box and then I'd see a lot of very disappointed people when they realize that it didn't result in new customers and that's because you're putting your item into somebody else's brand. But what if you could make a subscription box that is all about your brand? I think that is a much more successful way to do it than to put your item into somebody else's box. Just my opinion.

Speaker 1: 34:05

You can also offer membership services. So this is where you see people doing things like Patreon, where they try to draw their customers into supporting them on a monthly basis through a subscription service where they get extra perks or where they get, you know, in the illustration community, which is what I'm most familiar with, because that's a lot of what I do In the illustration community, which is what I'm most familiar with because that's a lot of what I do. So many illustrators will have different tiers in their Patreon, where the low tier is you just get access to a bonus newsletter or something, but then they'll have a higher price tier where you will get stickers every month, and then they'll have another tier where you get an art print every month, and then they'll have a really high tier where you might get an original piece of work and which, of course, obviously has a lot more value than a print and they will usually limit how many of those subscriptions they can take on. But that's a really interesting way to look at building. It builds a community around you, so you're bringing those core customers in and building an even tighter relationship with them, but at the same time, they're spending money every month in exchange for something that you are giving them. So those are both really great ways to increase your average order value, but to also increase customer loyalty and customer community around you. So that was one that I really like.

Speaker 1: 35:37

Number seven on our list is a free shipping threshold. This is really important right now during the holiday season, when people are buying and shipping. So the idea behind this is, if they spend a certain amount of money, their shipping is free. Now you have to be careful with this. You have to do the math and you have to make sure that you are not losing money by offering them free shipping. And the idea is that you look at what your average order value is now. So let's say your average order value right now is $25. The idea is you want to make sure that your free shipping threshold is at an amount that is higher than your current average order value. So if your average order value is $25, you might decide to offer free shipping if they spend $35. Again, you need to make sure and this is really tricky in Canada because our shipping is expensive here, but you need to make sure that the cost of the shipping isn't eating away at all your profit. So, yeah, if it's going to cost you $20 to ship that item within Canada, you want to make sure that you're making a lot more than $20 in profit from that order. So I would think probably for most of us in Canada, we would want our shipping value, our free shipping value, to be somewhere in the anywhere from the $60 to $100 range before they have access to free shipping.

Speaker 1: 37:01

For some of you, that might not work with the price of the products that you sell. So that's something to consider. You really, like I said, you really need to do the math and you need to know your numbers and you need to make sure that you are making a good profit already and that you're priced appropriately. Or this won't work, but if the math works out, this is such a great way, psychologically, to get people to spend more, because how many of us have filled our cart and realized we are $5 away from free shipping? And of course, we go back because we know that shipping is gonna be $20. But if I can just spend an extra $5, the shipping will be free and of course, the shipping is not really free. It's built into the cost of everything that I'm buying. So that's what you have to think about in those situations, but it's such a powerful psychological tool to use.

Speaker 1: 37:49

Number eight on our list is volume discounts. So again, this is kind of what I was talking about when I mentioned that when people buy one sheet of my stickers, they pay full price. When they buy three sheets, they get a little bit of a discount. When they buy five sheets, they get a bigger discount, and this is very common. Most of us have probably experienced it when we're buying our raw materials. For most of us, when we're very small and starting out, we buy 10 of something and we're paying a premium for those 10. But when we get to the point where we're making a lot more and now we can buy a hundred of that item in one fell swoop and we get a discount. And then, if you get up to the point where you're selling, where you're purchasing a thousand or 5,000 or 10,000 of that item, you're getting a really sweet discount and it helps bring the price of your products down. You can do the same thing for your customers. So, again, this isn't going to work with custom, one-of-a-kind items, but if you make things that can be sold in larger quantities, this is a really great tool to use and make sure that you advertise that discount.

Speaker 1: 39:01

Number nine on my list is pre-orders and exclusive access. So pre-orders is one that I use and that has been very effective for me. So again, I'm in the stationary niche and one of my biggest selling products every year is my boxed Christmas cards. Okay, boxed Christmas cards are an item that snail mail people love, are an item that snail mail people love and a big chunk of my customer uh, of my, my client base, my customer base are snail mailers. These are the people who love to send and receive mail and so of course they love Christmas cards and they love to buy a box of them so they can send them out to all the people that they care about. And with Christmas cards you very often have to send those out in advance because you want them to get there before Christmas. So people are buying those quite far ahead, and my first year that I offered them I was very nervous because it was a big investment for me at that point.

Speaker 1: 40:06

This is very different from selling one card and making one card when somebody orders it. Now I need to make 10 of each card for a box, because a box would have 10 cards in it. I needed to box them up and it was a much higher price point than anything I had ever sold before. So I decided to offer them as a pre-order in mid-September and that way I would know how many people were interested and I would have lots of time to make the cards. And if I needed extra cardstock I would have time to purchase it and not worry about running out at the last minute. And it was also a really great way to to see which designs were the most popular, so that when I did markets, if one design didn't do well in the pre-order, I just wouldn't make that design for markets. I wouldn't take that. I wouldn't waste the space, I would take the one that everybody bought my best seller to markets.

Speaker 1: 41:03

But it was so effective because the very first pre-order I did I wound up doing Because the very first pre-order I did I wound up doing. I did $700 in sales in the course of 24 hours, $700 in pre-order sales and I think I was charging $30 per box and that included shipping and of course, they got envelopes with it and they came in a cute little packaging and everything envelopes with it and they came in a cute little packaging and everything. And it was great because this was more money than anyone had ever spent with me. This was a much higher price point than my usual $7 greeting card or my $10 4x6 art print. This was three times the most expensive thing that I had ever sold and it was a really great way for me to get people to purchase without me having to make all this inventory and not knowing whether or not it would sell. And so once I knew how many I had to make. That's how many I made. And then I made a few extra to sell online and it was such a good decision.

Speaker 1: 42:09

And now I try to do that pre-order every September with a new boxed card design and it very often makes September my highest revenue generating month of the year, as opposed to November and December, through that pre-order and people spend far more money than me on that pre-order. What happens very often is they also buy. I think I sell my box cards for $35 now, but they buy that box card set and they usually buy other things. They usually do a lot of their Christmas shopping and stocking stuff for shopping at the same time, so very often those orders can be anywhere from 50 to a hundred dollars, whereas my normal order can be quite low because I sell inexpensive things like cards and stickers. So this is a huge way for me to increase my average order value for the year. And the people who buy them through the pre-order tend to be my regular loyal customers who purchase from me regularly, so it's not often I get new customers through the pre-order. So I am literally selling to that core group that shop with me every year and, yeah, it has been very successful for me. It's one of my favorite ways to do this.

Speaker 1: 43:22

You can also, as I said, offer exclusive access, and so this is where you might decide to have a sale just for people on your newsletter, and you might do it once a year and you give them exclusive newsletter subscribers get exclusive access to the sale and then you can offer whatever discount you want. You could also do limited editions of things. So let's say, you make an original and then you do a print from it and you might offer that print all year long, for years and years and years. You just keep. As long as people keep buying it, you keep making that print. But what if you created a piece of art and then decided that you were only going to issue 20 prints and they would all be signed and that's it, when that print run is done, it will not ever happen again. You can sell those prints for far more than you would sell the print that you just continuously print and ship out. So that's another example of limited access is giving people limited editions of things that you make once and that's it.

Speaker 1: 44:26

I've seen authors doing this where this, particularly independent authors, where they are printing a special edition, a beautiful hardback copy of one of their books, with gilt edges and ribbon bookmarks and incredible cover art. And yeah, it's only available. There's only going to be 300 copies of this book made and once it's gone, it's gone. You'll still be able to buy the cheap paperback version, but this beautiful, artisan quality edition will only be available for a certain number of people and, of course, it will be sold at a premium price. I think that brings us to number 10 on our list. Yes, number 10.

Speaker 1: 45:12

Introducing a loyalty or a referral program. This is another easy way. How often do we go to the same grocery store every month because we have a loyalty card for that grocery card? And how often does your grocery loyalty card have an offer on it for you that if you spend $300 this month, you know what it used to be if you spent $100 and then it went up to $200 and now it's $300. That's the state of groceries in this right now. But if you spend $300, spend $300, you get an additional 2000 points. Or if you spend $100, you get $10 off your next purchase. The stores like Old Navy and Old Navy is really good at this, chapters Indigo is really good at this. They give out the coupons. They do this always in December. You're buying a huge bucket load of books for gifts in December and they give you a coupon where you get 25% off a purchase of $25 or more in January, because the idea is to make you come back into the store when it's not busy. So you get a nice juicy discount if you spend a certain amount of money in January. So that's another option that you can offer have a sale. If you spend more than a hundred dollars, you get 25% off your order. That's a really, really simple way to increase average order value. So I have 15 items on my list. There's far more than this, but this is where I'm going for terms of keeping this episode manageable. But this is where I'm going for terms of keeping this episode manageable.

Speaker 1: 46:50

For number 11, you could offer a customization. So we talked about customizations a little earlier in the episode, but this is where you could create a product that could be easily left alone with no customization and still be a perfectly lovely item or gift, and then you also offer customization as a fee. So this could be let's say, you make little custom crochet critters. Those are super popular right now. Maybe you could offer customization where you create a little like remember the cabbage patch dolls? Maybe, maybe you do, maybe you don't, depends on how old you are, but the cool thing about the cabbage patch dolls is they all came with their own little birth certificate with their name and everything, and it was super cute. What if you did like a little customization certificate for your crochet stuffies where the recipient's name goes on the certificate? And I think that would be really cute for gifts for little kids. You could also do something if you sell clothing items or you know it'd be cute is.

Speaker 1: 47:53

I know what's really popular right now are things like Kindle sleeves, book sleeves, little pouches. A lot of people are making those these days. What if you added a tag onto those and you customized it with the owner's name? You added a tag onto those and you customized it with the owner's name, so they know that that is their Kindle sleeve. Or you sewed a little custom tag onto the sleeve that says this is Melissa's book sleeve. That is a really simple thing that you can do and you can charge more for it because it's a premium service.

Speaker 1: 48:26

Number 12 on the list is limited edition or seasonal products, so we talked about this. This is kind of a variation on the one that we talked about just a few moments ago, where you know you might have a limited edition print or a limited edition book edition or something like that. You can also do this with like seasonal items, so you may have a can also do this with like seasonal items, so you may have a, let's say, you're doing jewelry and you might launch a holiday themed sparkle collection, and these are items that are only going to be available through Q4. And once they're done, they go back into the vault. Disney is an expert at this. They don't do it as much now that we have streaming, but before streaming, disney used to take their movies out of the vault. So when VHS became really popular, they would take Snow White out of the vault. They would release it on VHS for a very limited period of time and you would have to run out and get it to make sure you have it, because then it would go back into the vault and it wouldn't be available for years. And then when DVDs came out, they did the same thing you could get the limited edition DVD and then it was gone. And then when Blu-ray came out. They did it with Blu-ray and now we have streaming, so it's a little bit different.

Speaker 1: 49:43

But if you could take some of those things that you make and create a limited edition version of them that's only available or limited time only, you see this with. Like you know, I was watching some videos. This is a couple months ago when the Stanley Cup craze was just bananas and people were going absolutely nutso over a new Stanley Cup color that was available at Target and they were all rushing out because they had to get this color of the cup, even though it's exactly the same as the green cup they already have at home. Now it's available in pink with polka dots and they have to have that version. So that's something else that you can do. You can kind of have a limited edition color run or a limited edition seasonal run, and those items are only available during that specific time and then they're done. Or when you sold out, they're done, creating a sense of urgency. That's another way that you can increase that average order value, number 13,. We're getting close to the end here.

Speaker 1: 50:44

Another way that you can upsell is with. This is a great one for artists. What if you upsold with? You can buy a print as is or you can buy a framed version of the print, because framing is always a big roadblock for a lot of people. I have prints sitting over there behind me, if you're watching on YouTube, that I have purchased but that are not hanging because I don't have frames for them and I haven't had time to go out and get frames for them. I haven't found the frame that I like for them yet. But to be able to buy a print that is already framed and I have several on my wall here that came with the frame when I purchased them and they're already hanging. They're being enjoyed because the frame was there Are there ways that you can make something that you sell, that you can add an upsell option on it so that you take some of the hassle away?

Speaker 1: 51:37

We've had Heather on the show so many times and one of the things she talks about is that she will even offer to hang one of her paintings in a client's home. So obviously she just does this for people who are local to her paintings. Uh, in a client's home. So obviously she just does this for people who are local to her. But again, she makes very large scale paintings and they can be very tricky to hang. So she'll go in and she'll help them choose the best place in the house for the painting, where the light's going to be perfect for it, or help them find the right place in a specific room where they want the painting. She will bring the hardware, she will do the work, she will get up on the ladder, she will put the nail in the wall and she will hang the painting for you, make sure it's level, make sure that you're happy with it. So can you offer some kind of service like that, where you go the little extra mile for a little extra money? Another easy way to increase your average order value Number 14 on the list, and this is a great one for the holiday season is create value with packaging and presentation. So again, this is similar to upselling in our previous episode, in our previous example.

Speaker 1: 52:42

I'm at the point where I've talked too much and my tongue is tied. But you might want to create like a premium. You could have a gift wrapping option. Most of us will do that, particularly on Etsy, and, as I already mentioned, you get them to pay for the gift wrapping option. But what if you had a premium gift wrapping option so they can have just the regular thing, where they get it in regular drugstore wrapping paper and it goes into the box. But what if you could create a premium gift wrapping option for a really special occasion? Or maybe you even hand deliver it, if that's something that you can offer in your local area, where it's like an experience opening this gift? It might come in a box and then there's a beautiful presentation inside the box and they pull it out and there's more to like. The whole thing becomes an experience. You can charge us quite a bit more money for something like that than for the drugstore variety wrapping paper with scotch tape.

Speaker 1: 53:48

Okay, so last on our list and, like I said, there's so many there's. There's things that I haven't got to, and this is something that is only limited by your imagination. You could offer online workshops and tutorials as an extra service. I've seen a lot of people doing this, where you purchase a book. Let's say this is a great one for content creators, for creative service providers, but let's say you have an ebook or something that you're selling helping somebody do something related to what it is that you're involved in, and they buy the book, but then they also have the option to add on a mini course with it or a tutorial or something like that, or you give them access to video tutorials.

Speaker 1: 54:34

I can't remember her name, but there was a food blogger several years ago who created a vegan desserts cookbook. I'm trying to remember how she did it, but she had all these different levels of how you could purchase the book. I believe there was an ebook version, I believe she had a printed version, and she did this all herself. She didn't have a publisher, but the book did so well I believe a publisher became very interested in it, so you could get the ebook version. You could get a printed book version. You could also purchase the printed book or the ebook with a series of videos showing you how to make the recipes, and I think she had some other tiers. But I remember speaking to her about this once and she said very few people just bought the cheapest version. Most people wanted the extra stuff, they wanted the videos, they wanted the tutorials, they wanted to have the hardcover version of the book, and so that's something that you could consider doing and, like I said, this works really well if you're in the creative services provider area. But I think, even if you're a maker or something you know, if you can create an item, but then for an extra fee, they could get access for, uh to you know, I think I'm just thinking, I'm thinking out loud now but what if you created? Um, again, let's go back to the stuffies what if you created, uh, some digital patterns where people could make little clothes for their stuffies or something like that, and you sell that as an add-on to the stuffies? Yeah, something along those lines, but I think that has the potential to. I think that's something that would work really well, like I said, for creative service providers and content providers. Yeah, I'm, I'm, I'm thinking that one out loud in my head.

Speaker 1: 56:27

And there is one more bonus, one that I did not mention here, and I can't believe I didn't mention it. I thought I had it written down. I did not, but this is a great one for the holiday season and it is one that you can easily use if you're working at markets, and that is the buy one get one. Okay, this is such. They're called BOGOs buy one, get one. But there's also there's so many different variations you can do on this, and it could be something as simple If you buy one, you get another one at 25% off, or if you buy one, you get a second one at 50% off, or if you buy one, you get a second one free, or if you buy two, you get a third for free. So it's basically another form of bundling, but you're giving these to your discounts and the magic in it is kind of how it's worded, because when you say buy one, get one 50% off, people hear 50% off, right, and that's where their head is going to and they think that's a great deal. And it is a great deal, but it's not really 50% off. Basically, they're getting 25% off each item, so they're buying two items at 25% off each. When you say 25% off, though, it doesn't have the same response in the brain as when you say buy one, get the second for 50% off, even though it's a 25% discount on each item. So you can think about different ways that you might want to do this.

Speaker 1: 57:49

When I worked as a cosmetician, we used to do these all the time with things that people very often liked to purchase in multiple. So we would do it with things like lip liners, lip glosses, lipsticks, basically anything related to the lips. We would also do it with eyeliner pencils, brow pencils, nail polish, anything that people that's a small indulgence that people love to treat themselves with. People change their nail color frequently. People like to have multiple different kinds of lip color and things like that. Very few of us have a signature lip color that we wear all the time. Some people do Awesome, but a lot of us like to change what we're wearing based on our mood or how we're feeling, and so for those smaller indulgence items to be able to offer a buy one, get one or buy two, get one kind of thing it really does entice people to treat themselves even more and that's a great way that you can market it. So that is it for this episode.

Speaker 1: 58:50

I hope I gave you lots of ideas for ways that you can increase that average order value because, as I mentioned, it's such a simple way to increase your revenue and your profit without having to do a lot of extra work, because, chances are, there's at least one thing that I mentioned here that you have done before and you're comfortable with and that you probably do on a regular basis. So the idea being that you want to combine a few of these strategies at different points in the year. You don't necessarily want to run them all at the same time, but there are some that you could run year round, like the sticker example that I gave at the beginning. That is something that I offer year round and it has been a game changer for my sticker sales. So you might have something like that that you can offer year round, and then you might have things that are only available during particular seasons, so you might only offer free shipping during the holiday season or again like seasonal themed items that you might only offer during the season. So the idea is you want to combine some of these strategies and you also want to combine them with like I mentioned at the beginning, other business building strategies. So you know, we never want to get complacent and not go out and look for new customers. You should always be looking for ways to grow your customer base to get new customers in, but that is a hard gig and it's something that you have to do over and over again and be consistent with. So why not also add in the strategy of increasing your average order value to the existing customers that you have at the same time and the beauty with average order value is you're not increasing your average order value to the existing customers that you have at the same time, and the beauty with average order value is you're not increasing your prices. If a customer only wants to buy one item, that's all they have to buy. You're making the decision easier for them to buy more. So that's it for this week.

Speaker 1: 1:00:44

If you have any feedback on this episode, I'd love to hear it. You can always connect with me. You can email me at andshelookedup at gmailcom. You can leave a note in our Instagram DMs at andshelookedup, and if you're watching this on YouTube, you can leave us a comment. Give us a thumbs up, subscribe if you're enjoying our episodes.

Speaker 1: 1:01:03

We have a new season episode every second Monday and we are still going through our prep for the holiday series, which is going weekly right now. It is going to be on Thursdays now that we're into the regular season, so that'll be continuing weekly until we are done with that, which I suspect will probably be sometime in late November. We're on task 12, I think at this point, task 12, maybe task 13. Yes, so thank you all so much for being here. We'd love to hear from you. If you're listening to this on your favorite podcast app, you can always go over to YouTube and leave a comment, and I think Spotify now gives you the ability to leave a comment as well. I don't know how I get notified about those. I don't know if anybody's done that or not. I should probably look into that. But yeah, there's so many different ways you can give me feedback, or you can leave a comment. Or if you have a particular tactic that works really well for you to increase your average order value, share it with us in the comments. So that's it for this week. We'll talk to you all again very soon.

Speaker 1: 1:02:06

Thank you so much for joining us for the and she Looked Up Creative Hour. If you're looking for links or resources mentioned in this episode, you can find detailed show notes on our website at andshelookedupcom. While you're there, be sure to sign up for our newsletter for more business tips, profiles of inspiring Canadian creative women and so much more. If you enjoyed this episode, please be sure to subscribe to the show via your podcast app of choice so you never miss an episode. We always love to hear from you, so we'd love it if you'd leave us a review through iTunes or Apple Podcasts. Drop us a note via our website at andshelookedupcom, or come say hi on Instagram at andshelookedup. Thanks for listening and we'll see you next week.