User-generated content (UGC) is a vastly popular topic in the digital marketing industry and it’s for a good reason. For the uninitiated, user-generated content refers to the content created by other people such as your loyal customers, influencers, brand ambassadors, and so on.
Most e-store owners don’t realize it immediately, but user-generated content can positively impact your brand’s Average Order Value (AOV) and doing so successfully has a plethora of benefits.
A recent report revealed that user-generated Facebook posts tend to receive 7 times more engagement compared to branded-generated posts. And the reason is simple. UGC is considered as one of the most trustable forms of media by online shoppers.
In fact, a survey conducted by BrightLocal found that 92% of people rely on other customers’ reviews when they’re looking to buy any product online.
Here are some more interesting statistics about user-generated content in eCommerce:
- 97% of customers read reviews before making any purchase.
- 90% of customers have admitted that reading positive reviews positively influenced their purchasing decisions.
- 89% of customers read the brand’s responses to customer reviews.
- 86% of customers said negative reviews influenced their final purchase decision.
The facts above clearly reveal the importance of user-generated content for eCommerce brands. But in this article, we’re going to focus specifically on the impact of UGC on the average order value in eCommerce stores.
What is Average Order Value? Why Does It Matter?
AOV is a key performance metric for eCommerce stores to understand their customers’ purchasing habits.
Simply put, AOV is the average monetary value of every order placed on your eCommerce site for a given period. It’s an essential metric to track if you want to increase the overall revenue and profits of your eCommerce business.
Knowing the AOV of your eCommerce store can provide valuable insights for improving your marketing as well as product pricing strategies. It helps you set a benchmark for customer behavior and allows you to set better goals, create better strategies, and evaluate how well they’re working. Most importantly, learning about AOV gives a peek into how much your customers are spending on your products.
Once you have knowledge of what your customers are spending per order, you can strategize your product pricing based on those insights.
How to Calculate AOV in Your eCommerce Store?
Calculating the average order value in eCommerce is very simple.
All you need to do is divide total revenue for a defined period of time by the number of orders received during the same period of time. Like any other metric, the AOV can be calculated for any period of time but almost all eCommerce stores calculate it on a monthly basis.
For example, let’s say your January month’s revenue was $25,000 and you received a total of 150 orders. So, $25,000 divided by 150 equals $166.66, which is your January month’s AOV.
3 Concrete Ways to Increase eCommerce AOV Using User-Generated Content
User-generated content is beneficial in many ways. But if you want to focus on increasing your AOV specifically, there are ways to do that as well. Below are the 3 concrete ways to increase your eCommerce AOV using user-generated content.
1. Incorporate UGC Content in Product Pages
Allowing your customers to create content on your product pages is a great way to not only keep it up-to-date with fresh content but also showcase genuine feedback from customers who have already purchased your products.
Moreover, your potential customers would believe the existing customers’ opinions more than your claims. And as we’ve already learned, customers are more likely to proceed with a purchase if they read positive reviews about the product(s).
This is the main reason why you absolutely should allow customers to write reviews on your product pages and showcase them in your eCommerce store.
2. Include UGC in Email Marketing Campaigns
Email marketing is another proven tactic to increase engagement, boost conversions, and skyrocket revenue for any eCommerce store.
In fact, many eCommerce brands invest heavily in their email marketing campaigns because it gives a solid return on investment.
Unfortunately, most eCommerce brands miss an extremely critical aspect in their email marketing campaigns — User-generated content.
Believe it or not but UGC can amplify the impact of your email marketing campaigns.
Here’s an example of leveraging UGC in email campaigns.
And here are some clever ways to implement user-generated content in your email marketing campaigns:
- Include your previous customers’ reviews/feedback in your marketing emails. This is particularly more effective when you’re sending a reminder email that a customer has some products in the shopping cart. Just include positive reviews from other customers of the same products and it will definitely increase the likelihood of closing the deal.
- When you’re promoting a specific product or group of products in your email, include screenshots of social media posts talking about your product.
- If you want to increase the probability of making a sale, you can offer a limited time coupon along with the positive reviews of previous customers for particular products you’re promoting.
3. Repurpose UGC Content for Flash Sales
Flash Sales are an incredibly powerful and proven way to boost sales for an eCommerce store. If you happen to run flash sales from time to time, you should definitely consider showcasing user-generated content in them.
There are many types of UGC you can include in your flash sales such as product reviews, screenshots of social media posts by customers, unboxing videos, and much more.
Here’s an example of showing customers’ ratings and reviews in flash sale.
However, if you’re planning to run a flash sale for the first time, know that customers expect a faster delivery than usual for buying products from flash sales. So, make sure that a proper order fulfillment system is in place to meet your buyers’ expectations throughout the flash sale period.
As you’ve seen so far, user-generated content can have a significant impact on the average order value of eCommerce. Hopefully, you’ve now learned some of the best ways to leverage UGC to scale your eCommerce AOV.