What Is Basket Size and How Do You Increase It?

Getting a clear understanding of what customers are adding to their carts will go a long way when it comes to optimising your sales and marketing efforts. More specifically, tracking insights around the average basket size (ABV) will allow businesses to devise strategies that drive even more conversions.

Keep reading to find out what ABV means, as well as five effective strategies to increase it, to boost revenue and delight your customers.

What is basket size?

Average basket size (ABV), also referred to as cart size or units per transaction (UPT), is a metric that describes the number of items a customer purchases in a single transaction. For example, if you ran a grocery store and a customer purchased one loaf of bread, one carton of eggs, two bottles of milk and a packet of chips, their basket size would be five items. Keeping track of ABV will give businesses the opportunity to improve different aspects of the sales process to drive more conversions, and provide a better experience for customers.

ABV is calculated as:

Average basket size = total number of units sold/ total number of transactions

Why is average basket size important?

Understanding how many items are being sold per transaction is useful for a number of key reasons. Not only will it help with managing inventory by staying on top of the movement of products, but it will also provide insights into different sales trends, and allow you to dig deeper into your customer analytics.

ABV can equip sellers with a better understanding of how successful their marketing is, and how much customers are engaging with their brand. Monitoring the size of each transaction can also shed light on things like seasonal products or which items are being purchased together, and can give a more in depth view of shopper behaviour.

How do you increase the average basket size?

1. Keep products in stock

This might seem simple, but having popular items available is a sure-fire way to maximise sales opportunities and increase ABV. Waiting for a product to be restocked, or requesting a notification for product availability, creates unnecessary friction during the transaction and is likely to decrease the ABV. Keeping as many options in stock as possible gives customers the opportunity to shop for the items they need without availability being a barrier.

Stay on top of inventory by regularly checking stock levels and ensuring all data matches what’s actually available — you don’t want ‘phantom inventory’ messing with your numbers, so it’s important to confirm all reporting is correct.

2. Offer promotions and discounts

There’s no denying that everyone loves a deal, and sales promotions are another effective way to increase ABV. It’s important to get the promotional strategy right to ensure that sales events don’t come at the expense of existing potential revenue. But, enticing shoppers with deals like buy one get free, bundle deals, rewards for future purchases, or a certain percentage off, can help to push them over the line, and increase the number of items purchased.

Analysing the data from previous promotions and running smaller test sales will help businesses understand what their customers get the most value from.

3. Personalise recommendations

As Forbes explains, “When it comes to increasing average basket size, personalisation is key. The reason is simple: Personalisation drives engagement, long-term engagement builds loyalty, and loyal customers drive business”. Using data and analytics to get a better idea of what shoppers are purchasing means businesses can personalise their experience to better suit their needs. A customer’s order history will give insights that can inform marketing campaigns that not only resonate, but also drive more conversions.

One approach to this is recommending products that align with previous purchases. For example, if a customer regularly purchases a specific brand of shampoo, sending a personalised offer for the conditioner in the same range might entice them to try a product from a brand they’re already familiar with. A slightly different approach could be simply highlighting their favourite shampoo when it goes on sale – the customer will enjoy the additional value and potentially add more items to their basket.

4. Gamify the checkout experience

Gamification comes from the word ‘game’ and refers to the application of gaming strategies to commercial processes – online and instore. Holding a customer’s attention long enough to complete a purchase is getting harder, with shoppers growing accustomed to more engaging and rewarding experiences. Customers, and people in general, like to feel validated, be challenged and rewarded, be surprised, and feel anticipation – this is why checkout gamification is so successful.

Gamifying the checkout experience can increase sales, as well as build brand awareness and boost loyalty. It involves incorporating elements of play and common game mechanics like points, rewards, and other incentives to keep customers engaged. A good example of this is the McDonald’s annual Monopoly promotion, whereby customers are incentivised with a chance to win when they collect codes from certain menu items. Customers are engaged by the instant wins, as well as the chance to collect sets of codes to build streets, like they would when playing the board game, to win big ticket prizes.

5. Optimise your store layout

Leveraging the store layout to engage customers is an excellent way to increase ABV. Strategically arranging the placement of certain items in the store can create a seamless experience for shoppers, but can also push customers to roam around the store in a way that encourages impulse buying.

Costco does a great job of this by moving items around the store to always stimulate a ‘treasure hunt’ experience, that gets customers moving through the store and discovering more items along the way. Other big retailers utilise the store layout by stocking end-caps with the best sellers or biggest deals. Another method includes adding loss leader products towards the back of the store, so that customers can encounter more products while they make their way over to that area.

There are a number of advantages to understanding ABV, and leveraging that data to drive growth and stay competitive in the marketplace. Keeping track of this vital information will allow businesses to improve the shopping experience to drive conversions, by devising innovative sales and marketing strategies backed by these compelling customer analytics.

Ready to increase your ABV and provide a better experience for your valuable customers? Get in touch for your free ideation session today!