TLDR

Most businesses would appreciate extra income, and if you're reading this blog, chances are you're looking to increase your profits by selling more and increasing order sizes. A 2019 survey of U.S. coffee shops revealed that a significant percentage, between 50% and 74%, of independent coffee shops don't survive their first five years due to insufficient revenue.

There's a simple tactic that's easy to implement and can boost your revenue - upselling. When a customer places an order through your app, that's the perfect time to suggest an additional item or two. A friendly prompt can encourage them to add a pastry, bagel, or extra shot of espresso. Small upsells add up, increasing your average order value. In this article, we'll explore some of the most effective upselling tactics to easily implement through your mobile app. Let's dive in and start making the most of every order!

The Benefits of Upselling to Increase Your Coffee Shop's Average Order Value

As a coffee shop owner, increasing your average order value should be a top priority. One of the most effective ways to do this is through upselling - encouraging your customers to purchase additional, higher-priced items to supplement their initial order.

Upselling via your mobile app provides several advantages. When a customer places an order for a drink or food item, your app can suggest complementary add-ons like a pastry, muffin, or bagel to go with their beverage. The customer already has their payment info entered and is in a buying mindset, so suggesting a small upsell item, especially at a discount, leads to a high conversion rate.

Bundling popular items is another upsell tactic. For example, offer a breakfast sandwich and coffee combo, or a pastry and espresso deal. Bundling boosts your average ticket price while providing perceived value to customers.

Sending push notifications for time-sensitive upsell offers also works well. Notify customers about a 2-for-1 pastry deal or discount on bottled beverages within 30 minutes of placing their order. The immediacy prompts many to take advantage of the limited-time offer.

Upselling customers who pay via the app typically yields a 20-30% increase in average spend per order. While a few dollars may not seem significant, those small amounts add up substantially over weeks and months. The additional revenue goes straight to your bottom line, so employing upselling strategies through your mobile platform is well worth the effort.

Types of Upsells You Can Offer Through Your Mobile App

Per Diem allows you to propose upsells once customers have placed an order through the app. Seize the opportunity to suggest additional items, encouraging them to increase their total spending. Some easy upsells to offer include:

• Size upgrades: Ask if the customer would like to increase their drink size for a small upcharge. For example, “Would you like to upgrade your medium coffee to a large one for $0.50 more?”
• Add-ons: Suggest add-ons like an extra shot of espresso, flavored syrups, or toppings to enhance the customer’s experience. For example, “Would you like to add caramel drizzle to your latte for $0.25?”
• Pastry or snack pairings: Recommend a complementary food item to go along with the customer’s drink order. For example, “A muffin or croissant is the perfect pairing with your hot coffee. Add one for just $2 more?”
• Loyalty program signup: If you offer a loyalty or rewards program, prompt the customer to enroll to earn benefits like free drinks or discounts on future orders. For example, “You can earn a free coffee after your 5th purchase by joining our loyalty program. Sign up now to start earning rewards!”

With strategic upselling through your mobile app, you'll boost customer satisfaction, increase average order values, and drive more sales and profits for your business. Give these types of upsells a try and see how much of an impact they can have on your bottom line.

Best Practices for Upselling Customers on Your App

Once customers place an order, take the opportunity to suggest additional products to increase their basket size. The key is to make recommendations that are relevant and appealing without being pushy.

Suggest popular add-ons

Consider prompting customers to add popular extras like an extra shot of espresso, flavored syrup, or whipped cream. For example, “Would you like to add a flavor shot of vanilla, caramel, or hazelnut for only 50 cents?” These small upcharges often have high profit margins and customers expect options to customize their drink.

Upsell larger sizes

If a customer orders a standard coffee or latte, suggest bumping it up to the next size for a nominal fee, e.g. “For only 30 cents more, would you like to make that a large?” Many will take advantage of the perceived value, especially if you highlight how much more they’ll receive for a little extra.

Cross-sell complementary products

Suggest adding a muffin, scone, or other bakery item to complete their order. For instance, “To go with your coffee, we have fresh blueberry muffins and chocolate croissants available. Would you like to add one to your order?” Cross-selling related products in this way can significantly increase average check sizes.

Make recommendations visually appealing

Use enticing photos of the add-on products within your mobile app to capture customers’ interest. Studies show that visuals stimulate cravings and drive desire for food and beverage items. So, placing a picture of a flaky croissant next to the suggestion to add one to an order will result in higher uptake.

Reward loyal customers

Provide special perks and incentives for your regulars and app users to upsell them. For example, give them double points or stamps on their loyalty card when they spend over $10 in an order. They’ll keep coming back for more.

Train your team

Educate your employees on suggestions for upselling customers in-store too. Give them scripts and prompts to naturally recommend combo deals, larger sizes, and add-on products when taking orders. Their recommendations can be very influential.

How to Configure Upsells With Per Diem

As a coffee shop owner, upselling is key to increasing your average ticket size and boosting revenue. With the Per Diem app, you have the perfect opportunity to upsell customers when they place an order. The app allows you to promote complementary products to customers in a subtle yet effective way.

To configure upsells in your app, start by choosing 2 to 3 highly popular or high-margin menu items you want to upsell. For a coffee shop, this could be a larger size of drip coffee, a bakeitem to go with the coffee, or a premium espresso drink.

Next, in your app's dashboard, select the menu items you want to upsell. The app will then prompt the customer with a message like "People also buy". Customers can then easily add the upsell item to their cart with one tap.

Be strategic in how often you prompt customers with upsells. Limit it to 1 or 2 upsells per order to avoid being pushy. Also, rotate the upsell items and messages frequently to keep things interesting.

Track how well your upsell prompts perform over time. Look at how many customers add the suggested items to see which upsells have the highest take rate. Then, double down on what's working! You may also want to try different wording and placement of the upsell prompts to optimize them.

A successful upselling strategy in your mobile app can increase your average ticket size by 10-30% or more over time. Not only does this boost sales and profits, but it also enhances the customer experience by providing helpful suggestions. Upselling is a win-win for your business and your customers. 

Common Questions About Increasing Order Sizes

How can I encourage customers to buy higher-margin items?

Once a customer places their initial order in your app, suggest complementary add-ons or larger sizes to increase the total sale. For example, if they order a small coffee, prompt them to upsize to a medium or large for just a little more. Or, suggest adding a muffin, scone or other bakery treat to make it a combo. These kinds of upsells are easy for customers to say “yes” to and significantly boost your average order value.

How often should I rotate or change the upsell offers?

It's a good idea to frequently update your upsell prompts and deals to keep things fresh for repeat customers. Some suggestions:

• Rotate the specific items you're bundling or upselling every 1-2 weeks.
• Update the messaging and creative for your prompts every month or so.
• Run short-term flash promotions, like offering free add-ons for orders over a certain amount or percentage discounts on certain menu items for 24-48 hours.
• Tie your upsell offers to holidays, seasons, or events for themed, time-limited deals.

When is the best time to present the upsell offer?

The optimal time to present an upsell offer is after the customer has added their initial item to the cart, but before they proceed to checkout. This allows them to easily add the upsold product without having to go back and modify their order. You have their attention, and the upsell feels like a convenient suggestion rather than an interruption.

Final Thoughts

So don't miss out on this low-hanging fruit. Implementing upselling in your mobile app can enhance your average order value and revenue with minimal additional effort, potentially saving your coffee shop from failure. Start with easy add-ons like coffee creamers, extra shots, and bakery items that customers are likely to purchase. Then move on to offering combo deals and promotions to incentivize larger orders. With a customer-focused approach, upselling can lead to bigger basket sizes and happier customers. At Per Diem, we're invested in your success - contact us anytime to discuss how upselling could benefit your business. Go forth, upsell thoughtfully, and watch your average order size grow.

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