Is Dropshipping Worth It?
Is Dropshipping Worth It?
Why?
It’s
been around for years and years, bringing profits to serious entrepreneurs.
[1]eCommerce
sales in India are growing at an annual rate of 51%, which makes it the
biggest opportunity for online retailers.
The
old ways of doing business are getting disrupted the world over!
This pandemic has become a big inflexion point for digital businesses not just in India but globally as well. On the one hand, the retail footfall is seeing alarming lows while on the other, eCommerce is on a new roll.
In
this scenario, dropshipping becomes all the more attractive
for those, seeking new ways of monetization.
Let’s
understand its basic concepts and relevance in today’s world….
Dropshipping
is essentially an online retail store where customers book their orders. The
details of the order are passed on to the supplier who ships the order directly
to the customer.
Some
of the key takeaways of this business are that as a drop shipper you don’t
have to:
·
Physically store goods or
·
Manage a warehouse or
·
Handle shipments
This
certainly gives you AMPLE time to focus on other critical aspects of the
business.
What
do you need to start this business?
Two
things:
· An internet connection
· A laptop
Furthermore,
to execute the business you will need the following support:
· Website
· Niche
· Marketing Strategy
· Customer Support
And
you are good to go!
The
flexibility of this business lies in the fact that it can be run as a
parallel hustle to generate a PASSIVE income or can be run independently.
Let’s
quickly understand how to generate a passive income from dropshipping.
Dropshipping a parallel hustle….
The
easiest way to make revenue from drop shipping is to run it as a parallel
business to your already existing eCommerce business.
This
way you don’t need to start from zero user base. Your existing traffic can be
used to drive and push your dropshipping business. Money lies in traffic!
Later
on, when your dropshipping business picks up, you can scale it. The sky is the
limit!
If
you run a dropshipping business alone, you will have to search and build a new
client base.
Not
that it can’t be done, but it can become quite a TASK in the initial stages of
your business.
Pick
your battles!
Delving
into the different aspects of drop shipping will make it easy for you to
understand its functionality and USE in today’s world.
Dropshipping
journey
To start with, think of a niche which sells!
Niche
How
does one pick the right niche?
One
can’t have an answer right off the bat, as this depends on a few factors:
- trends
- competitors
- target audience
- ease of shipping
Trends
Pop-culture
(unique) products like coffee-mugs, funky jewelry, T-shirts etc. are the ideal
dropshipping products.
Due
to the ongoing pandemic shoppers have become cautious with their spending. Health,
fitness and home happen to be their prime focus.
This
explains the reason for the sudden surge in demand for the following products:
§ Blue Light Glasses - to reduce eye strain from screens
§ Resistance Band - for gym
enthusiasts
§ Smart Watches - for
fitness
§ LED Strip Lights - to
decorate homes
§ Paint By Numbers Kit - to pursue a hobby
Trimmers,
Juicers and Vacuum cleaners are other popular products.
Pandemic
or no pandemic, you can’t forget the special days (birthdays and anniversaries)
of your friends and well-wishers!
Worry
not, however, if you are unable to visit them due to social distancing, you can
have them sent a personalized item like an Initial Pendant Necklace.
Sniffing
out trends is the first step in selecting a niche.
A
bunch of other things which could help you in zeroing in on the niche are:
Target
Audience
Sales
is a result of demand and supply.
Research
and find out what your audience is looking for. Pitch accordingly!
Competition
You
will have to take a call to either compete directly with the biggies like
Amazon or you could pick a niche with low competition and potential buyers.
There
is no template as such, to follow. No size fits all!
You
need to check the local competition, demographics and the geographics.
You’ll
need to know the prices your competitors are offering. Maybe you will have to
undercut them to stay competitive.
Brainstorming
at this stage can’t be ruled out. Hitting the sweet spot does take time and a
whole lot of research.
Ease
of Shipping
Selecting
a niche which requires light shipping can make your job easy as you can offer
free shipping.
This
SERIES of calculated steps will help you select a proper niche.
Getting
a reliable supplier on board is the next step.
Supplier
Suppliers
are the backbone of your dropshipping business.
They
do a lot of heavy lifting as far as this business is concerned. From storing goods
and maintaining inventory to handling shipments.
Hence,
it becomes important to make all the necessary inquires before selecting one.
Do thorough research on the internet. Check your supplier’s reviews and
testimonials.
Once
you are satisfied with the credentials, place a test order. This way you can have
a first-hand experience about, as to how the supplier operates.
Once
you are through with selecting the supplier and the niche, it’s time to create
your virtual store.
Website
Today’s
users’ attention span is extremely low with a zillion things vying for their
attention.
Thus,
it becomes important to have a super cool website which looks good, funky and is
super-fast too.
You
have a choice between the self-hosted or the hosted platforms.
If
you are technically fine and have money to spare, go for a self-hosted one. This
gives you more freedom.
Otherwise,
if you are not sure and don’t want to spend in the early stages of your business,
then hosted platform is the place to be.
Big
Commerce, Woo Commerce, Magento are some of the examples of hosted platforms.
They all come with their own sets of positives. Choose the one which best fits
your bill.
Now,
your dropshipping business is ready for the BIG leap.
Reaching
your customers!
They
are the ones who shall play a huge part in making your business count.
So, leave no stone unturned to woo them.
Marketing Strategy
There
are no two thoughts about the fact that the Marketing landscape has evolved
tremendously, especially due to the rise in digital consumption.
Marketing
penetrates and operates at different levels of the dropshipping business.
Let’s
dive deep and explore all the levels and ways of CONNECTING with your potential
buyers. The Devil lies in the details!
Deliveries
Instant
gratification has become our second nature. We want deliveries and returns to
be handled faster.
So,
talk to your supplier right in the beginning about making your business
efficient and CUSTOMER ORIENTED.
All
deliveries, returns or complaints if any have to be handled within a timeframe,
as promised to the customer.
This
will go a long way in bolstering your brand.
Free
shipping
Free Delivery a Huge Hit
As
many as [2]90%
of customers choose free shipping as the number one incentive
for online buying.
Do
your best to offer free shipping or maybe discounted shipping.
In
case you can’t, be transparent about it right from the word go.
Never
resort to hiding tactics; they show your brand in poor light.
Marketing
is all about creating POSITIVE vibes. It’s better to stay away from practices
where your customer feels shocked or shortchanged.
Mobile-Friendly
Nowadays,
people of all age groups are glued to their smartphones. [3]In
India, online buying via smartphones ranges from 42% to 60%.
Smartphones
are known to trigger impulse buying. So, ensure your virtual store is
mobile-friendly to net this segment.
Advertisements
and Social Media
Getting traffic and sales requires you to be nimble.
Try
the paid advertising space and at the same time work consistently towards getting
the organic traffic.
You
can start your targeted marketing campaigns by putting out:
· Facebook ads
· Google Ad words and Bing Ads
Other
than that, you can adopt these digital tools to attract organic traffic:
· SEO
· Content
· Social Media
· Email Marketing
Optimizing your website is necessary to get ORGANIC
traffic.
Today’s
businesses are all about experiences. Be it the website experience or the
delivery experience. Give them the best experiences.
ROX
(return on experience) shall help you in scaling your business. USER EXPERIENCE
is the new SEO.
Deliver curated content so that it builds
traction and engagement. The effect feels fresh if you keep updating it.
You will find people of all age groups active on these
platforms. The Gen Z and Millennials are hooked to it.
Social media influencers have become stars of the
digital world. They carry clout.
You can use these influencers to highlight your
products by making videos of 25-30 secs. and thus, gain access to LOCAL
customers.
Show off your brand and share its story on the
different social media channels. Keep posting regularly to make a strong
presence.
People, usually are scouting for freebies and
discounts over these channels.
Put out a sale notice on Twitter or Instagram. You can
add an element of urgency by attaching a deadline to it. This can have a
knock-on effect!
Besides generating a sale, you could get likes and
shares. That surely spreads the good word!
These are some cool ways of GRABBING traffic.
There is yet another way of reaching your customers in
a focused manner: the email marketing route.
It is an old marketing tool, quite popular even with
new-age businesses. It works.
As such, we all get a good number of emails every day.
We do end up reading quite a few of them!
Start making emails preferably with a catchy hook line
to draw attention. Well written and personalized emails do get noticed.
Talk about your product, share videos and highlight
discounts (in case you are offering them).
Emails carry your message directly to the people in a
subtler way without making much noise.
Be CONSISTENT with sending emails, they will fetch
results.
Be innovative and bring fresh ideas to the table. You never know which idea of yours can catch fire!
Pricing
There is no doubt about the fact that every sale that
happens has a good amount of hard work behind it.
If possible, choose a product with a higher value.
This is to pocket a good profit with every item you sell.
Competition research
Follow your competitors to know how they run their
business. You could gain a better understanding of how things are done.
Evaluation
Nice to have traffic! The traffic has to get converted
into sales.
Hence, it becomes important to analyze and evaluate
every sale threadbare.
Track the data, to see what triggered the conversion.
Find out the comparison between the paid and the
organic traffic to see what clicks.
With all the metrics in front of you, refine and
retune your marketing strategy. Be armed with better insights for future
campaigns!
At the end of the day, marketing is all about reaching
your customers, acquiring them and retaining them.
Customer Support
Hope you are an entrepreneur with an eye for the
future. In case that is so, have a work ethos in place and work around it.
Investing in customer care shall keep your business
streets ahead.
To begin with, don’t reduce sales to a mere
transactional experience. That’s so uncool!
The moment your customer gives you a sales order, keep
them informed about the journey of the product.
Adhere to the delivery date and take prompt action in
case of returns and complaints if any.
Customers are valuable to your business.
Have HAPPY customers on board. Good reviews, repeat orders will go a long way in growing your business.
Dropshipping is an attractive business module. It requires
time and attention on your part to make it thrive.
All this begs one question.
Why do some drop shippers fail?
The answer is simple. Their approach is faulty. Every
single successful business requires passion and hard work to succeed.
If you enter this business on some hearsay or thinking
it’s some quick money-making opportunity, you are bound to get disappointed.
You have to follow the dos and don’ts of the business
you are in.
If you select a wrong niche, target the wrong
audience, you are not customer savvy at all. And on top of that, if are not
ready to improve and approach things half-heartedly, you can hardly expect
things to fall on a platter.
These are the kind of people who dub drop shipping as
oversaturated or dead in the water.
No business gives you instant results. You have to be
ready to face challenges and give it time to develop. There are no shortcuts.
eCommerce is a thriving place all set to grow further. [4]As per 99 Firms eCommerce Stats for 2020, it is expected that by 2040, more than 95% of all purchases to be conducted via eCommerce.
Final Thoughts
Dropshipping is worth your time and attention for
these very simple reasons:
·
Low-risk business
· Easy entry
·
Almost no overheads required
·
Flexibility, can work beautifully as
a parallel hustle or can be run independently
·
Can be scaled exponentially
·
Ecommerce an accepted reality
·
Pandemic has acted as an accelerant
to digital growth.
[5]As
per the Morgan Stanley report, India’s eCommerce market is expected to hit
$200 billion by 2026.
Online buying has become the norm and is here to stay.
It’s practically unstoppable. Take advantage of this growing trend to expand
your business.
Research, Experiment and Test: these
are the three levers of the dropshipping business. They will help you survive
and soar!
Set the ball rolling as this is the BEST TIME to get
into dropshipping.
Stay Safe and Happy Dropshipping! 😀
[1]
https://www.oberlo.com/dropship-international/india
[2]
https://www.entrepreneur.com/article/320733
[3]
https://surejob.in/dropshipping-business.html
[4]
https://ecommerceguide.com/ecommerce-statistics/#:~:text=According%20to%2099Firms'%20Ecommerce%20Statistics,conducted%20via%20ecommerce%20by%202040.&text=It%20is%20expected%20th
[5]
https://www.livemint.com/Industry/9iUxlQZ4iHwPiXRKscx3LK/Indias-ecommerce-market-to-grow-30-to-200-billion-by-202.html
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