Dropshipping — the practice of listing products that are actually stocked and fulfilled on your behalf by third-party suppliers — is one of the key ingredients behind the incredible accessibility of e-commerce.
The industry was always going to attract traditional retailers, but it wasn’t certain to appeal to casual solopreneurs so straightforwardly. Dropshipping made that happen.
Once integrations rolled out to mainstream store systems, everyone learned that they didn’t need to buy any products, find storage space, or do any packaging to sell things online.
All they had to do was curate a solid selection, dress it up attractively, set the right profit margins, and sit back to watch their stores operate with little effort on their part. It’s rightfully known as the easiest way to sell online, as nothing else comes close.
That it’s easy to sell online, though, doesn’t mean it’s easy to make sales online. You can set up a hundred dropshipping stores and fail to get a single order because it’s really quite challenging to make it work.
If you’re determined to do it, you need to choose the right niche, get your tactics right, and be patient. Here are my specific suggestions:
1. How to choose a suitable dropshipping niche
There’s nothing stopping you from finding an all-new niche to cultivate, of course, and one of the best ways to do this is by combining two existing niches.
For instance, you could see the rising interest in ethical materials and fitness equipment and start looking for drop shippable fitness items made with environmentally-friendly materials.
This isn’t necessary, though: originality isn’t a vital ingredient for any part of the e-commerce world, and it’s particularly insignificant when it comes to a sales method that relies on generic pools of items from third-party suppliers.
If you can pick out a popular niche, you can shape your store accordingly and populate it with any products that you can tweak to fit.
Some other niches that are fairly reliable include cheap gadgets, gimmicky food items, fashion accessories, gaming equipment, and sporting goods. Approached correctly, despite the market saturation, each of those niches can be fertile ground for your store.
2. Stick with items that allow healthy profit margins
Let’s say you’ve selected the computing accessory niche, a niche that ranges from the cheapest computer cables to the most costly headphones.
Which products should you run with? Should you just add anything that you think people might like?
Well, it isn’t that simple, because it’s more important to find things that allow healthy profit margins.
Look at it this way: some products are extremely hard to sell at prices that deviate too much from the norm. Take expensive items like phones, for instance.
You can possibly get away with charging 2 percent more than the average, but any more than that and shoppers will go elsewhere, because phones are utility devices (and costly, meaning that 2 percent isn’t trivial).
But phone cases are different. Not only are they extremely cheap through dropshipping suppliers, but you can also get away with marking them up quite heavily.
It isn’t unknown for a drop shipper to sell a $4 phone case for $14 with some creative presentation (more on that next). Your profit comes entirely from the difference between the dropshipping price of a product and what you charge for it, so find products that allow that difference to be substantial.
3. You need to nail your presentation
As noted, you’re drawing from a generic pool of products when you sell as a drop shipper, which means you can’t stand out through offering a unique selection.
And since you’re adding cost to the regular prices to yield a profit, you can’t charge exceptionally-cheap sums either. This is why it’s so difficult to get noticed as a drop shipper.
So what’s the secret? How do some dropshippers manage to get so far ahead of others with the same product ranges and the same prices?
It’s mostly in the presentation. They make those products feel special, putting in a lot of effort for everything from copywriting (which means working hard on their writing skills) to product photography (using clean backgrounds, excellent lighting, and consistent framing to ensure that everything looks good).
Take something everyone else offers, create an entertaining product description, provide some impressive photos, and you’ll be able to charge more than others do, and still make sales.
I noted how popular phone cases are, and the same case can go for $5 or $25 depending on the context and how it’s presented (this goes for fashion-related items in general, so that’s a great niche to pursue if you really want to ramp up your margins).
4. Why PPC and SEO are your main weapons
Presentation only goes so far, though, as you need marketing to get people to actually see your store in the first place — and there are two marketing tactics you need to focus on, with each one providing results of a distinct kind and at a distinct pace.
Firstly, there is PPC (pay-per-click advertising): by launching some strong PPC ads across channels relevant to your niche, you can start picking up clicks immediately, and it’s cost-effective because of the payment model.
Secondly, there is SEO (search engine optimization) which is something you should prioritize as a long-term tactic.
By creating rich content about the products you sell (paying particular attention to things like category roundups — the best TVs, the cheapest hoverboards, the most reliable gym equipment, etc. — and product reviews), you can start earning rankings for valuable terms.
Keep it up, and your store will eventually get a respectable amount of traffic from organic search alone, allowing you to scale back your PPC budget if you’d prefer.
The basic formula for succeeding in dropshipping is fairly simple, then, though far from easy.
Choose a thriving niche that still has room for new brands, polish every part of your presentation (from your product copy to the style of your website), and combine PPC and SEO to win relevant traffic in the short and long terms.
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Kayleigh Alexandra is a part-time writer at WriterZone and content writer for Micro Startups, your online destination for everything startup. She’s passionate about hard-working solopreneurs and SMEs making waves in the business world. Visit the blog for your latest dose of startup and charity insights from top experts around the globe @getmicrostarted.