How Automatic Discounts Increase AOV on Shopify?

In the e-commerce world, every merchant seeks that magic formula to increase revenue. Among the most effective strategies? Boosting your Average Order Value (AOV). If you’re not already using automatic discounts, you’re missing out on a golden opportunity. 

Automatic discounts are a proven method to encourage higher spending, improve customer satisfaction, and ultimately, grow your business. But how exactly do these discounts work, and how can they be implemented on Shopify? In this blog, we are diving deep into the benefits of automatic discounts and show you how to use them to increase your AOV.

Understanding AOV: Why It Matters?

Your AOV is the average amount of money spent each time a customer places an order on your site. It’s calculated by dividing your total revenue by the number of orders. A higher AOV means more revenue per customer, which is crucial for scaling your business.

Also Read: Shopify Discount Apps- the Secret to Higher Conversions!

Why Focus on AOV?

While driving traffic and increasing conversion rates are important, focusing on AOV allows you to extract more value from each visitor. By encouraging customers to spend more per transaction, you maximize the efficiency of your marketing efforts and increase profitability.

The Magic of Automatic Discounts

Automatic discounts streamline the shopping experience by applying savings directly at checkout. There’s no need for customers to hunt for coupon codes or worry about whether they’re eligible for a discount. This simplicity improves the customer experience and encourages them to spend more.

Types of Automatic Discounts

Automatic discounts come in various forms, each designed to encourage more spending. Let’s explore the most effective types.

• Percentage Discounts: Apply a percentage off the total purchase when certain conditions are met, such as spending a specific amount.
• Fixed Amount Discounts: Deduct a set dollar amount from the cart total when criteria like minimum purchase thresholds are achieved.
• BOGO (Buy One, Get One): Encourage larger purchases by offering a free or discounted item when another is bought.

How Automatic Discounts Increase AOV?

Automatic discounts are powerful tools to boost your Average Order Value. Here’s how they can encourage customers to spend more.

1. Incentivizing Larger Purchases

Imagine you’re offering a 15% discount on orders over $100. A customer with $85 worth of items in their cart is likely to add another product to reach that $100 threshold. This simple strategy leads to a direct increase in AOV, as customers naturally spend more to unlock the discount.

2. Creating a Sense of Urgency

Automatic discounts can be time-sensitive, adding an element of urgency. When customers know that a discount is available for a limited time, they are more likely to make a purchase and a bigger one at that. This tactic is especially effective during key sales events like Black Friday Cyber Monday (BFCM).

3. Reducing Cart Abandonment

Cart abandonment is a major issue for online retailers. Automatic discounts help fight this by providing an immediate incentive to complete the purchase. When customers see that a discount has already been applied, they’re less likely to abandon their cart and more likely to finalize their purchase, driving up your AOV.

Also Read: Advantages of Revolutionizing Your Shopify Discounts

Implement Automatic Discounts on Shopify

Shopify makes it easy to set up automatic discounts directly from your admin panel. Here’s a quick guide:

1. Go to the Discounts section in your Shopify admin.
2. Select the type of discount you want to offer, such as a percentage or fixed amount.
3. Define the conditions under which the discount will apply, like minimum cart value or specific products.
4. Set start and end dates, and activate your discount.

While Shopify’s built-in tools are powerful, you can take your discount strategy to the next level with specialized apps.

Top Shopify Apps to Improve Discount Strategy

To truly maximize your AOV, consider integrating these top-rated Shopify apps that offer advanced discounting features:

1. Shopify Coupon Discount on Cart

Shopify Coupon Discount on Cart app allows you to showcase available discount coupons right on the cart page, making it easy for customers to see the savings they can get. The visual cue can encourage them to add more items to their cart.

2. Custom SizePrice Calculator

Custom SizePrice Calculator app provides dynamic pricing options, such as bulk discounts and tiered pricing, automatically adjusting the cart value based on the quantity or spending, further driving up AOV.

3. Automatic Discounts & Upsells

Perfect for offering Buy One, Get One (BOGO) deals, volume discounts, and free gifts. Automatic Discounts & Upsells app creates compelling offers that encourage customers to increase their cart size.

4. Bold Discounts 

Bold Discounts app allows you to automate sales across your store, offering automatic discounts on selected products or collections, ideal for boosting AOV during sales periods.

5. Discount Ninja

Create urgency with countdown timers and display discounts in real-time. Discount Ninja app’s advanced features encourage customers to spend more before time runs out.

6. Ultimate Special Offers

This Ultimate Special Offers app lets you combine multiple discount types, from BOGO to bundles, maximizing their impact on AOV by offering multiple incentives to increase cart size.

7. Agree Terms & Condition

While primarily a legal tool, Agree Terms & Condition app can trigger automatic discounts upon customer agreement, improving both trust and AOV.

Also Read: How Shopify Automatic Discounts Improve Customer Loyalty?

The BFCM Boost

Black Friday Cyber Monday (BFCM) is the biggest sales event of the year. To maximize your revenue during BFCM 2024, automatic discounts can play a pivotal role. Here’s how:

1. Pre-Sale Teasers

Offer early bird discounts before the main event to build excitement and secure early sales.

2. Flash Sales

Use apps like Discount Ninja to create time-limited offers that encourage immediate purchases.

3. Bundle Discounts

Promote product bundles with automatic discounts to increase AOV during the high-traffic BFCM period.

Improve Your AOV with Automatic Discounts

Automatic discounts are a strategic tool to increase your AOV and grow your Shopify store’s revenue. By implementing these discounts through Shopify’s native tools or with specialized apps like the Shopify Coupon Discount on Cart, you can encourage customers to spend more, reduce cart abandonment, and boost sales- especially during crucial sales events like BFCM.

Start leveraging automatic discounts today, and watch your AOV- and profits- soar.