Show Notes:
Ad costs are increasing, that’s a fact. So to continue to run ads profitably, there are two actions you can take.
One is to continue working to get the lowest CPA possible. That’s a given and should always be a goal. However, when it’s not possible to get back to your insanely low CPA’s from 2019, then the next action is to increase your AOV (average order value).
Increasing your AOV means you’ll be increasing the average dollar amount spent per paying customer. This will allow you to spend more in ads to obtain a single purchase.
In this week’s episode, we’ll look into several ways to increase your AOV that you can implement immediately so that you can start spending more on your ads and making more profitable sales!
Go ahead, grab your coffee and get ready for Episode 23 of the Ad Agency Secrets Podcast!
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Share-worthy Quotes:
“Being able to increase your average order value is what’s going to allow you to make more revenue per sale.”
“It’s always about testing for you, and what will work for you.”
“If you feel like you’re undercharging and you’ve been thinking about increasing your price point, I’m giving you that green light.”
Get the Transcript here:
Episode 23 – Tips To Increase Your AOV
Note: We use AI transcription so there may be some inaccuracies.
Hey, I’m Jess Walman, Facebook Ad and Digital Marketing Expert. Welcome to the Ad Agency Secrets Podcast, where I help you take the guesswork out of your ad spend and replace it with profitability. Now is your time. Revolutionize your life and create the impact you desire all while freeing up your precious time. How? By taking a sneak peek at the exact methods that our full-service ad agency uses for our A-list clients while managing over $1 million per month in ad spend. Learn what is and is not working from Facebook Ads to copy, to funnels into your overall marketing strategy. Implement these tips and strategies inside your business today, and get ready to explode. Grab your coffee and get ready for the Ad Agency Secrets Podcast.
Hey guys, welcome back to the podcast. This week has been going quickly. I feel that the days are going by faster. I’ll look up from my computer and it will already be 1 o’clock in the afternoon and the time just flew by. So I don’t know if anyone else is feeling that way, but I guess being busy and being on calls all day or busy where I look up and hours have passed. I guess that’s a good thing. I guess that’s a good thing. They always say stop and smell the roses, but I guess when it comes to work and if you’re doing what you love and you don’t even realize the hours passed by, then I guess that’s a really good thing.
So I guess, I’m not going to complain. But it has been going by fast, so hopefully, you guys have had an amazing week so far. Today, we are going to be talking about tips to increase your AOV, your average order value. Now, your average order value is very important. Obviously, this is where you are increasing the dollar amount of orders that people are purchasing from you in a single funnel. So if you have a self-liquidating offer that sells for $37 and they buy that one offer, and that’s it. Your average order value is $37. Whereas if you also then offer them, let’s say they have the option to buy something else at $19. Well, 50% of them take you up on their $20, and 50% of the people take you up on it, your average order value now is $49.
So being able to increase your average order value is what’s going to allow you to make more revenue per sale. But also, be able to increase your potential cost per acquisition on the front end. When you’re running paid ads and you are trying to hit a certain CPA, cost per acquisition, cost per purchase, and you’re saying, oh I can’t go above this dollar amount because my average order value is only this much. If I’m going to be profitable or break even, it needs to be at this amount.
The more you can spend on Facebook and the more you can really beat your competition and be able to spend more, because you’re able to make more on the backend, the better it is. It’s easier, it’s going to be to run ads and scale those ads to a larger number. So average order value, a lot of people really put emphasis, like I was just saying, on the cost per acquisition. And meaning, we’ve had several people come to us with self-liquidating offers. And one of the first things we look at is, what are you selling on the back end? How are you increasing your average order value? Are you just relying on Facebook ads, getting the cheapest cost possible, cheapest purchase possible so that you can just make that $37 sale? Or are you taking actions on your backend to upsell them into other areas in several different facets?
There are several different ways to do that. And this is super important. This again is the number one thing we look at when clients come to us with self-liquidating offers. We’ve even been able to do this with main offer sales. If they’re selling a $1,000 product or even a $5,000 product, what’s another way to upsell them or sell them into something else so that the average order value increases?
And most people aren’t looking at that. They come to us and they say, I’ve got this product and I need my cost per acquisition to be this. So let’s just even go towards a thousand dollars program. I have a thousand dollar program, I need my cost per acquisition to be $300 no more. I want to be able to get a little over three X returns on ad spend or $400 more. A little over two X, whatever it might be for you. And the right ad amount about that, and that’s where they want to go. And that totally makes sense. Of course, they want to be profitable. But at the same time, we’re also looking at their funnel, looking at how it’s set up and asking, okay, well once they buy this product, then what? How are you able to bring them into another offer to impact their life more with another paid product that will then increase your cart value? So that you can actually potentially spend a little bit more per purchase and get more sales. Because if you have to hit a certain number, then when you’re running your paid ads, what are you doing? You are turning off ads that are, oh my CPA is above the $400 mark, and I didn’t want it above that. So I’m going to start turning things off. Whereas now you say, oh that’s a little above it, but now I know I have a little bit of wiggle room because my average cart value is actually more than a thousand and is actually now $1,150.
Cool, I can have a few of these on a little higher and I can start scaling now. I can scale more. So it’s why it’s important to have that average order value higher and to really think about it on both ends. Traffic is super important but the funnel is obviously just equally as important. I always say they both have to work in tandem. The KPI metrics for your traffic and the KPI metrics for your funnel have both got to work. You can’t alienate one from the other.
So I’ve got a few ways to increase your average order value if you’re not already doing these. Some of these are common. Some of these might be newer for you. And if you’re not doing them, please start doing them. And I’ll give you a couple of examples of some of our clients who just recently did this.
One thing is, which most people don’t even think about, which is to me, they’re probably the most obvious is increase your product price point. Your main product price point, increase it. If it’s at $997, go to $1,097. Go to $1,050 even. Even if it’s a little bet, it’s going to help your overall profit margin. So increase your product price point. Don’t be afraid. If you’re nervous, it’s not going to sell that. I promise you, $100 or $200 will not make the difference if your price point is already a thousand. If it’s $2000, a few hundred dollars, even $500 will not make a difference. But again, it has to be in your comfort zone. It still has to be what you want.
So I’m just saying, if you already feel like you’re undercharging and you’ve been thinking about increasing your price point, I’m giving you that green light and confidence, and letting you know to go ahead and do it. So from there, add in an order bump. So if it’s a self-liquidating offer, meaning that they’re going to go buy a small product right now for $27, $37, or $47, whatever that price point might be. Having a small product for them to then just click. An order bump means they say they’re buying it. They enter the name and information. They can click one little check box that says, yes, I’d like to also add in this $17, $27, whatever it is, a small product with it.
It’s very quick, yes. I like to think of order bumps as the easiest yes possible. If people are already putting in their credit card information for your product, make the next product with just literally just one click. The easiest yes possible that would instantly increase your average order value, and you didn’t have to do anything extra. You created this little product once. You put it on there. And I like making them an easy yes. I’d like to see about a 40% uptake on that. Give or take, again, it depends. I have some clients who have a 60% intake on there. Actually, one client who has 80% take on theirs and it was pretty insane. It was actually a higher price point than I would normally put it. It was like, I want to say $47, which was higher than what I would normally put it.
So again, you have to play with it. It’s all about testing and marketing. So playing with it and testing it with your audience. So that’s a very easy yes. If you don’t have that already, do it. We actually have a client right now who is doing this with their $997 offer. It’s very interesting. This is what probably most of you aren’t doing. So if you are doing the self-liquidating offer, you might already be doing an order bump. But let’s say, you got a $997 offer that you sell on the backend of a webinar or a challenge, and you want to increase the average order value.
One thing that one of our clients is doing right now is they’re testing the waters on a smaller price point. Once someone buys the main product, they are upselling them into just $47. If it’s a little order bump, $47, that’s it. It’s not very expensive, but pretty much right now, most people are taking it. This now means their average order value went from $997 to $1,047.
So next is going to be increasing that price point, and see if they can get it for $97. And then increasing the price point, maybe having to increase the value of the product as well, it just depends and trying to do $197. Because if they’ve already bought $997, they’re pretty much bought in at this point with you and your product. And if you’re saying this is supplemental to it and it will help you get to your results faster, and it’s only $197. The take rate on that will be pretty high. And now, your average order value just went up on your main product which most people don’t think about.
They think about upsells into higher win programs, which is still another way that’s going to be one of my other ways, is upsell into a higher-end program. So let’s say, if you were doing your $37 offer, you add an order bump. And then from there, you send them to an upsell, which is maybe $997 or $197 or $297. A lot of people will upsell into higher-end tickets, and that is another way. So I want you to jot that down. That is another way.
Self-liquidating offer with the order bump to then upsell them into another product that is higher priced than the original product. And some people do that with the webinars when they’re selling their $997 offers. So sell their $997, they buy it. Usually, they’re going to wait until later to upsell them, so they’ll upsell them organically into a higher-end ticket. But I have seen it where they do it on the backend.
Most of the time though, once someone buys a $997 or somewhere in that $997 to $2,000 range, even $500 to be honest, to the $2,000 range. Usually, they’re going to upsell them into something higher right away because someone hasn’t really gone through the main program yet to say, cool, I’m excited to pay you a lot more money now. Because really they haven’t gotten results yet. Which is why upselling them into a smaller price program is an easy yes. They want it faster. You’re saying, here’s how to get it faster and you sell them into that.
So, guys, the order bump and then upselling them into, if it’s a self-liquidating offer, upselling them into a higher price to program. If it’s more like a webinar funnel or a challenge funnel, and you have your price point between that probably $400 to $500 up to $2,000 price point where they can just buy it right away on a checkout page. Then you want to go ahead and upsell them. You could try both. Upsell into a smaller price program, which is what my client’s doing, which is so far doing really well. But you could also try doing it to the higher price program. But most likely, it’s probably going to be better with the lower price program.
Some people add in a second upsell, especially with the self-liquidating offers. I’ve been through some funnels where I go through five or six upsells. And I’m sorry, I just find that too much. Maybe people are buying them and maybe they work. I don’t have any clients that do that. I find that just being massively like, I don’t know. I personally wouldn’t want someone to go through my funnel and be like, man, she just tried to sell me six different times in his funnel. I kept saying no thanks, and it was really annoying. I couldn’t get to my confirmation page because she kept trying to sell it to me.
So if it works for you, great. Because guess what? The more people buy, the more your average order value goes up. So I am an advocate and doing a couple of upsells and then I like to stop there. And then maybe the next one, guys, is doing a down-sell. And so that’s if someone says no to something, then maybe you offer them a smaller piece of that at a smaller price point.
So, hey, here’s my bundle. Oh, you didn’t take the bundle. Why don’t you just take this piece of it, which is the most popular part of it? And you only have to pay for this. So it’s downselling them into something smaller which is also really helpful again in increasing your average order value.
Another way to increase your average order value is just to send them up to your ladder in general. So we have some people who literally only have a self-liquidating offer and that’s it. So that is like all they’re selling. You can only get so far with that. Can it be profitable? Yes. But is it going to help you probably reach your main financial goal? No. So you really need to be able to ascend them up to your next offer, whether that’s, hey, they bought it. And now you email them to go to your evergreen webinars. Then get into your program or email them to get on a phone call with you to then get them into your high ticket offer.
You do need to be able to send them up to it. Now, if you don’t have that ready yet, don’t let that stop you from getting sales on your smaller price offer. But I’m an advocate of having in place whatever product is going to be your main bread and butter. Whatever is actually going to make you profitable and help you meet your financial goals, that’s when you should be running paid ads. I don’t really want you running paid ads with something that might just break even in preparation for, oh maybe three months from now, I’ll have something ready, and then you don’t have it ready. And you’ve been building this list and done nothing with them.
I mentioned that they’re going to get a little stale, especially if you’re not ready to sell them something. So make sure you have something to sell to them.
So yes, that was just pretty much it guys. Really the biggest ones are order bumps, upsells. You don’t always have to do the upsell to the bigger program, it can be to a smaller program that has been working really, really well. Again, you already have that buy-in, that yes. So think of something that you already have created that you can just put in there. Adding downsells, obviously, the big one is just increasing your product price point and not being scared to do that. A lot of people are, but don’t be scared to do that. And then, sending them up to your ladder what has actually worked really well. Give you an example for some of our clients. It’s worked really well is memberships. So some people will go into a three-month program for somebody, or 12 weeks or even 6 weeks. Whatever it might be a program.
And let’s say, it costs a thousand dollars or $1,500. Whatever it might be, or even $500. But usually, let’s say, it cost a thousand dollars, then they say, hey, this program is for 6 weeks or 8 weeks. After the program or close to the end of it, they start offering them membership. Hey guys, for just $47 a month, you can continue to get this content, keep this content, have access to it. Be in the Facebook group, have access to the monthly coaching call and that’s it. Forty-seven bucks a month, they get a monthly coaching call. They get access to all the content because you never said, this would be for those who don’t say lifetime access, and they’re getting access to the content.
If you think of it in relation to the $997 offer that they just bought, it’s pretty inexpensive. They had all the coaching and all this stuff for those six weeks or eight weeks or whatever it is. And they’re saying, hey guys, the program is over, but guess what? For just $47 a month, you can now stay on and get extra stuff. How many people are going to say yes to that? You will have a very high conversion rate on that because the price point is so minuscule compared to what they already paid you. And if they even got slightly any results in your program, that $47 a month will be an easy yes to them. Because now, there’s also that FOMO of missing out and not leaving the community and not leaving the content and still having access to it.
And it doesn’t seem like it’s a big price point. Now, your average order value and actually this is more towards lifetime value, to be honest with you. It’s like the lifetime value of my clients, just a thousand dollars because that’s the only thing I ever sell to them, and that’s it. Now, you can say, actually I liked it, the value is closer to $1,300 because people join my group afterward is such an easy yes. And they stay on for at least three months, but now it’s $1,300. Boom. Now $1,300 is way higher, obviously, in higher profit margins than your thousand. So that’s just another example.
Guys, I love to give you guys examples of what’s happening currently with our clients, because it’s always fun and interesting to see the different things that they implement and the different things that work for some and don’t work for others. So it’s always, always, always about testing for you and what will work for you. And so I will continue to give you new things that my clients are implementing, new strategies that are working so that you guys can. If it works and makes sense in your strategy, guys do not get shiny objects syndrome.
Okay, it has to be focused on what your main goal is and if it works and that’s something that you can implement. If it’s an easy thing to implement, implement it. If it aligns with your end goal, if it doesn’t jot it down, put it away for later so that you can implement it later when it’s time, when you’re ready. But don’t get shiny object syndrome. That is not what this podcast is about. That is not what I am about. I’m just here giving you things at work, things that you can implement now. Add an order bump and you should be doing those things now, no matter what. Because that will absolutely help your revenue income right now. But some things that I mentioned that our clients are doing, do not think that you have to do that. But keep that in mind, in case, later on, you want to do it, or if it really makes sense for you to do it now, then you can do it.
Alright, guys, those are my tips on increasing your average order value. Some of those, I know, you have not implemented yet. So please implement them and start getting more money. Alright, I’ll see you guys in the next episode. Bye.
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