Increasing You Average Transaction Value: 5 Tips
‘Would you like a chocolate bar for only ninety-nine pennies?’ A question we hear almost every time we choose the human cashier over the automatic machine in the supermarket. However, this is far from being a mere challenge to our diets, but a detailed-planned strategy designed by marketing experts. If you buy that chocolate, and the guy after you in the queue buys it too, and the guy after the guy after you fails also into temptation… that’ll end up as a significant cash-up for the seller.
If you have or run a café, a restaurant or a shop, these strategies might seem more difficult than they actually are. Actually, it only requires a bit of prior planning. Here are five super-easy ways to increase the average transaction value in your business:
1. Design your premises with care. Nothing can be forgotten or left to chance. Look at how Marks & Spencer’s escalators are designed: once you’ve reached a new floor, rather than having the next section of the escalator on your side (the ‘sensible’ way in which many big shops are structured), the architect has put them behind you. Why do you have to go back to go up or down? Because this ‘forces’ you to wonder around the premises, spend more time in it, see more products and, therefore, you’ll possibly spend more money.
2. Be more expensive. A scary attitude for many retailers since they sensibly fear they’d lose customers. However, some people are willing to pay more if you offer more. More time with them, more products, a shop with more space and easier to browse in. Every time we step into an independent retailer, we’re aware that the price may be higher as they cannot compete with big stores; however, many people wouldn’t mind spending a bit more if the full sales experience is more satisfying and personal.
3. Up-sell & Cross-sell. You may not know these terms, although quite possibly you’ve already implemented them in your business. Up-selling is when you offer better and more expensive products, whilst cross-selling is when related or smaller products are added to the final sale – and, like the chocolate bar example, you increase your transaction value. Up-selling can sound like a greedy word but it doesn’t have to, if as sales guru Jeffrey Gitomer maintains, you are ‘helping your customers win’. If you want to learn some strategies to up-sell, click here.
4. Combine products / Bundle your offers. Every time you purchase something on Amazon, they offer you other products you may be interested in. Books by the same author, shirts with similar patterns, another Disney DVD for your children. If they do this, you can do it too. Someone who’s ordering a steak is generally willing to combine it with a glass of red wine, and people who buy a pair of gloves, may also want a scarf. Put these products together and, where possible, bundle them: free small glass of red wine with your steak or 50% off your hat when you buy a pair of gloves.
5. Loyalty Cards. By implementing a loyalty programme, you’re rewarding your customers for returning to your business. Something as simple as a free coffee with a stamped card after ten visits may bring you extra revenue. Your customers may share their coffee with a friend who’ll have to pay for theirs, and perhaps they’ll order a slice of your amazing chocolate & peanut butter cake, and, if the chat is good enough and you have a comfy and beautiful place where people would spend hours, why not have a second coffee? Don’t think about how much that drink costs (which, in fact, is very little), but focus on how well-cared for your clientele will feel and, in turn, how much more money they will be likely to spend if they enjoy the experience in your business.