There are different approaches to handling this and many other inquiries you may get when performing magic for lay people. I just say it's magic and most people understand, that I don't really want to tell them how it's done. However, most of my time isn't spent performing for lay people. I enjoy practicing more than anything though. Be sure to check out the Saturday Night Contest. Theory11 is filled with a lot of insightful people. Welcome to the Forums.
First, it's very important to recognize the difference between "How did you do that!" and "How did you do that?"
The first is a reactionary statement, and you should not respond to it. Let them simmer in the experience for a while.
The second one is them looking for a method. This means they see your performance as a puzzle, and it's their job to solve the puzzle. In my opinion, this means the magician has failed to do their job - which is to provide a magical experience. I generally respond in two ways - first I give them an answer that will be satisfactory, but not reveal anything (unless it's a genuine skill, which I do use a lot). I never say phrases like, "It's magic", or "I don't know!" because the audience will just interpret this as, "I don't want to tell you." No one walks away happy with that response.
The second part of the response is to go home and fix my presentation. Because if they're looking for a method, I'm not presenting something that they can engage with properly and that's not acceptable to me.