The average ticket is one of the main sales metrics in an e-commerce or other type of business. It is widely used to calculate the average amount spent by customers in a given period. It is extremely relevant to understand the increase or decrease in revenue and helps to measure and direct the efforts and investments made in the areas of sales, marketing and customer success.
With a simple calculation called average ticket, you can find out what is the average amount spent by each customer within your business, among many other important information.
This data can make all the difference in the success of your company, as it helps you understand consumer behavior, revenue variations, measure the performance of actions and know if they are generating the expected result.
In this text, we will explain in detail what this metric is, why it is important, how to calculate it and much more. Check out!
- What is average ticket?
- Why knowing the average ticket is important
- How to calculate the average e-commerce ticket?
- How often to monitor the average ticket
- How do I know if my average ticket is good?
- How to increase the average e-commerce ticket
What is average ticket?
The average ticket is one of the key sales metrics for e-commerce and other businesses. It is widely used for calculate the average amount spent by customers in a business and in a given period. But it can also be used to calculate the average value of each order/sale.
The higher this amount, the more customers are spending on the business and vice versa. Therefore, this metric is extremely relevant to understand the increase or decrease in revenue and helps to measure and direct the efforts and investments made in the areas of sales, marketing and customer success.
Why knowing the average ticket is important
Knowing the average ticket of your business is very important, for several reasons. The main ones are:
- helps to understand consumer behavior;
- identifies whether the investments are bringing the expected return;
- detects seasonal variations and/or opportunities;
- helps you prepare for down times;
- contributes to the planning of strategic actions.
By knowing the average ticket of your business, it is possible to understand consumer behavior of its customers and whether the investments made in acquisition e retention are bringing the expected return. From this, it is possible to assess whether the marketing actions, sales and customer success are being effective or if they need any adjustment.
For example, if your analysis differentiates the average ticket of men and women, youth and adults, among other characteristics, it is easier to know who consumes the most and which audience you should focus on. Or in which to stimulate consumption to increase this value.
By analyzing the average ticket, you can also identify seasonal fluctuations. For example, do your customers buy your product more in winter or summer? At Easter or Christmas?
By recognizing these variations, you can better prepare for the low moments and at the same time, think about strategic actions to keep the average ticket value always high, regardless of the time of year.
With all this information, you can bet on actions to increase the average ticket, that is, increase revenue through the same customers. That's it cheaper and assertive than attracting new customers. After all, you already know their profile, what they buy and/or bought, and they also already know you, know and trust your brand, product and service.
How to calculate the average e-commerce ticket?
To calculate the average ticket of your business, first, define well the analysis period e what will be analyzed, after all, there are many possibilities.
In e-commerce, you can calculate the average ticket per customer or per order, considering that the same customer can make more than one purchase in your store in a given period.
Average ticket per customer
To find the average of how much each customer spends, simply divide the total billed in sales by the number of customers you sold to within the period you want to calculate (days, weeks, months, year). So, we have the following formula:
Average ticket = Sales revenue / Number of customers who bought in that period
For example, let's imagine that your company earned BRL 20 serving 50 customers, this means that in that period calculated the average ticket per customer was BRL 400,00.
Average ticket per order
To identify the average value of each order, simply divide the total invoiced in sales by the number of orders placed in that period (days, weeks, months, year).
Average ticket = Sales revenue / Number of orders in that period
Assuming that your company earned R$20 from 60 orders, then in this period the average ticket per order was R$333,33.
How often to monitor the average ticket
The frequency of monitoring the average ticket will depend a lot on your segment, the reality of your business and your strategies. But it is important that this metric is analyzed with some regularity. In general, it is recommended to evaluate it monthly or, at most, of 3 in 3 months.
How do I know if my average ticket is good?
Knowing what the average ticket is and tracking it is important, but it's no use having that number in mind if you don't know what it means. That's why we've separated 3 tips that will help you understand if your average ticket is good or if it needs improvement.
1) Review your average ticket history
As with almost everything in business, especially digital ones, the best way to know if something is going well or not is always to analysis. Therefore, our main tip is that you review your sales history and see what was the value of your average ticket in the last year and even in previous years.
You should also monitor and analyze this value on a monthly basis to see if there was a drop or a sudden increase, and from that, try to understand what exactly might have stimulated these changes. And based on that, knowing exactly what value is a good average ticket value for your company.
And if your average ticket has been stable for a long time, it may not be a very positive sign, as you are not managing to grow.
2) Compare with other companies in your segment
In addition to doing an internal analysis, it is also very important to analyze how the average ticket is in the market in which your company operates. So you can know how your business is performing against the competition or other players that have the same public-bowel.
If your competitors have a higher average ticket, it means you can reach that number too. Just understand what is preventing you from achieving this result: if you need to make improvements to your site; on your product pages; in product recommendations; in the mix of products offered, etc.
3) Check other metrics
Another way to know if your average ticket is good is to check other metrics, such as ROI (return on investment), ROAS (return on investment in advertising) is CAC (customer acquisition cost). After all, if your investments were high and your profits were low, you will have a loss. But if investments were low and profits were high, you're in the best of all worlds.
If the number of customers attracted was small, but their average ticket has a value that covers the costs invested and still generates profit, it means that your average ticket is very good. And if it's the opposite, it means that you should perhaps invest in strategies to increase your customers' average ticket, thus increasing your profit margin.
How to increase the value of the average e-commerce ticket
Investing in stocks to increase the value of the average ticket is a way of generate profit with less investment and more assertiveness than if you had to try to attract new customers from scratch. But, after all, how to increase the value of the average ticket?
There are numerous methods that are successful among retailers to make the customer spend more inside the store, adding more products to cart, increasing the number of visits, staying on the customer's radar so that they increase the frequency of purchases, among other things. We list the main ones below.
1) Focus on the right audience
One of the main ways to increase the average ticket is to focus your efforts to attract and retain the right audience, that is, a more qualified audience closer to yours. ideal customer profile (PCI). In addition to increasing the conversion rate, this helps to increase the average ticket, as it is much easier to make these people buy more than other customers who have a different profile than the ideal.
2) Expand your product mix
Expanding your product mix can also be a great strategy to increase your average ticket, after all, the customer who enters your store to buy a pair of pants can take advantage of it and buy a jacket they also want. This is good for you and for him, as he can buy everything in one transaction and enjoy the same shipping. But if you don't have one of the products, it will have to go to the competitor's website.
3) Invest in cross sell and up sell
It's no use attracting a more qualified audience and expanding the product mix if you don't use resources to stimulate the customer and spend more in your store. Therefore, bet on techniques of cross sell and up sell, which encourage the cross purchase and buying higher priced itemsrespectively.
One way to do this is through recommendation windows, such as “Buy together” and “Similar products”. But there are still many others product recommendation templates.
Want to know 4 reasons to use smart recommendation showcases in your online store? Then check out our video!
4) Promote product combos
Another way to encourage the purchase of more than one product and increase the average ticket is to publicize the sale of product combos, either in paid advertisements or in the virtual store itself.
5) Offer free gifts or free shipping
Offer gifts or free shipping for purchases above a certain amount is also a very efficient way to stimulate an increase in the average ticket, as the customer who entered the store just to buy a pair of sneakers may also end up taking a pair of shorts to take advantage of the opportunity. What's more, people prefer to pay more for an item than pay for shipping, for example.
6) Create a points or cashback program
Creating a points or cashback program can also encourage customers to buy more in the store, after all, if they are going to earn rewards, why not buy from your store and accumulate the points in the same store? platform instead of buying elsewhere?
This type of action also helps to attract new consumers, as customers often refer companies that offer these advantages — even more so if they also earn points with it!
7) Make it easy to pay
As well as the quantity of products, the ease of payment it can also encourage customers to buy more items in your store, after all, many people choose to spend more if they can pay more in installments, for example, thus reducing the amount paid in monthly installments.
Now you know what an average ticket is, the importance of this metric for e-commerce, how to identify if yours is good and how many possibilities there are to increase it.
The average ticket, as well as CAC, conversion rate, ROI, among other indicators, can make all the difference in your e-commerce.
It serves as a sales control, as it is possible to assess how much each customer is spending inside your store and plan actions that increase this value, that is, make consumers buy more. Therefore, it is worth doing a study of costs and expenses before pricing all the products that will be sold in your store, to get an idea of how much your profit will be based on the estimated average ticket.
How about starting to increase your e-commerce average ticket right now?
SmartHint can help you with that. Through smart search and product recommendation windows, you improve the in-store shopping experience and encourage cross sell and up sell, among many other things. This increases the average ticket, conversion rate and revenue. Meet our technology!
Updated by: Tania d'Arc