NEAFP Poll Question: “What is your average sales total per transaction?”
$0 to $20 : 11 %
$20 to $50 : 63 %
$50 to $100 : 17 %
Over $100 : 9%
Taking into account the average suggested retail of alpaca clothing and accessories, the majority of farms and retailers reporting in on this poll are selling on average 1 to 2 items per transaction. Farms and retailers can increase the amount of items sold per transaction, upping their average sales transaction, by utilizing the technique of Cross-Selling.
Cross-selling is the action or practice of selling additional products and services to an existing customer. Alpaca products are a great candidate for this sales method because the majority of items compliment each other and it's an easy leap from one product to the next.
Product Placement & Positioning
In your farm store's cashier area or online checkout page, offer your lowest cost items to people just about to check out. If you have ever purchased a pack of gum at the grocery store, this cross selling technique has successfully worked on you. Items like Boot Inserts, Felted Soaps, Bird Nesting Balls, and the like are all great examples of small, low priced items that are great additions to your customers shopping cart.
In today's economy, most people are looking for incentives to help them pull the trigger on their next purchase. Offering special incentives based on # of products and overall sales total can help push your potential customers to spend more per transaction.
Free Shipping on Orders Over XYZ
Free shipping on online orders is a tried and trusted method of increasing total spent per customer. If your average sales transaction is $40, try setting the Free Shipping bar at $75 and watch as customers mix and match items to meet the sale requirements, increasing your average sales transaction. Be sure to monitor your shipping cost per each transaction to ensure it's positively helping your bottom line. Short time windows can help boost the call to action and increase the effectiveness of this type of incentive.
Buy 3 pair Socks, Get 4th 30% OFF
By offering this type of incentive, the person is getting a better deal by purchasing more of a product they already want and could possibly purchase again in the future.
Socks are a great example:
Regular Price: 3 pair Socks @ $20 a piece = $60
30% off Incentive: 4 pair Socks @ $18.5 a piece: $74
You've successfully increased your sales transaction total without sacrificing much of your profit margin.
By bundling up already complimentary items and offering a slight discount, more customers will likely purchase the set rather than the individual item. Almost all alpaca clothing and accessories can be bundled up together, here are some proven examples:
Sock and Boot Insert Set
When a customer is buying socks, offer a slight discount on boot inserts.
Regular Price: $20 per pair of Socks, $10 per pair of Inserts
Incentive: $20 per pair of socks, 10% off each pair of inserts bought with socks.
Customers will be more likely to purchase inserts along with their socks, bringing the transaction total up to $29 versus $20.
Hat and Scarf Sets
Offer a slight discount with Hat and Scarf sets to increase the likelihood they are purchased together.
Regular Price: $60 per Scarf, $40 per hat
Incentive: Save 10% when purchased together.
Offer prepackaged sets or allow customers to mix and match from all styles to increase total sales transaction.
What all these cross selling examples have in common is that they offer complimentary products to an already interested customer. It's important to not overstep this boundary and mutual respect between you and the consumer. Your goal is to increase the transaction total for each customer but not at the cost of the entire business relationship. By offering a wide selection of products at varying price points and using these cross-selling techniques when it will benefit the customer and yourself, you will be increasing your average sales transaction without cutting into your profit margins.
To all that answered our last poll, Thank you much! Keep your eyes peeled for our next NEAFP Poll!