The number of dropshipping businesses coming up is on the rise every day. This is no coincidence as for the past five years, global retail e-commerce sales have more than doubled from about 1.336 billion in 2014 to about 2.8 billion in 2018. Although many old and new businesses are going into dropshipping at an impressive rate, the number of dropshipping failures is still quite high. Interestingly, about 90 percent of dropshippers don’t make it past the first month because of frustrations. So, what can aspiring dropshippers do to avoid this early slump? We’ve put together 8 hacks that will answer this question.
What is dropshipping
Believe it or not, this question still comes up among some business owners. Dropshipping is a retail strategy involves getting a product directly from the manufacturer to the consumers without the need for a storage facility. This is why dropshipping is preferred by most businesses as it is a lot cheaper than the standard retail model.
The high number of dropshipping businesses around today is quite understandable considering its profitability. It is however vital that you understand how to handle the business to avoid the early slump that most businesses experience. Let’s look at 8 hacks that will help you achieve success in your business.
1. Have a niche
As exciting as running a store that offers every product on earth sound, it is not always a smart business decision. This is especially true if you are only a small or medium sized business. The primary reason for this is that operating a general store that offers many different products reduces your chances of targeting a specific audience, thereby making branding difficult.
Having a niche market allows you to differentiate your brand from all others, and it easier for you to leave an indelible imprint on the minds of your customers. When you think of Apple, what comes to your mind? You think of electronic gadgets. This is exactly how having a niche makes it easy for your customers to remember your brand.
Marketing and advertising are very important aspects of any business. Having a niche makes marketing easier, as you can easily choose a marketing strategy that best fits your business. Also, you can easily define your target audience, making it easier for you to target adverts to your audience.
Some of the biggest businesses in the world today are in different niche markets. If you’re interested in growing your dropshipping business, then having a niche market is nonnegotiable for you. So, you need to do the necessary research and choose a niche that best fits your business model, idea, and personality.
2. Get the right suppliers
One of the factors that determine success in your dropshipping business is the supplier that you decide to work with. This should not be taken lightly as the supplier you engage with could make or mar your dropshipping business. It is vital that you get a reliable and reputable dropshipping company. Key things you need to consider are how they manage their data and product content. Also, how often do they update their inventory, what are their shipping times and cost, how they handle returns, what are the testimonies people have concerning working with them, and so on?
Imagine you promise your customers that they will get their goods within three days, and you are unable to meet this deadline because of failure on the part of your supplier. This would harm your business and could cause you to lose your customers permanently. It is essential that you are open to replacing any supplier that is no more reliable. This is where ruthlessness in business comes in.
3. Create a brand
Your brand is how your business is perceived, what comes to people’s minds when they hear the name of your business. It is the identity of your dropshipping business. The key to any successful business is a strong brand, so as soon as your business kicks off, your goal should be to create a strong brand. Creating a brand will build the reputation of your business and make it easy to command loyalty from your customers. People are loyal to a brand, so without one, it would be difficult for you to attract loyalty from your customers.
One of the easiest ways to develop a brand is to focus on a particular product and target a particular audience. This is niche marketing as we’ve discussed earlier, and it is a vital part of any dropshipping business. Branding also comprises your store name, design layout, logos, and other feels of your niche product.
Some of the things that need your attention if you want to develop your dropshipping business brand are your target audience, your slogan, your business logo, and your business name. There are sites nowadays that offer ready-made branded domain names, so you can visit such sites if you are not so sure on how to go about your brand.
4. Competition research
If you engage in discussion with any successful business person or anyone that knows a thing or two about business, you will learn that research is one of the pillars of a business, most especially dropshipping business. Apart from doing research on the type of products you want to focus on the suppliers you want to partner with, you also have to do research on your competitors.
It is important to note that you will always be competing with other business owners for whatever products you decide to dropship. This is where many people get it wrong, as they fail to make the right judgment because of the lack of competition research. For example, most businesses will rather focus on a product with little or no competition. As good as that sounds, chances are that the product has no demand in the market.
Competition research will help you choose the right product depending on the strength of the competition. It also shows you ways you can distinguish yourself among your competitors and carve out space for yourself. Of course, this is not as easy as it sounds and much work needs to be done. This is where other factors come into play.
5. Build a dropshipping online store
One of the key components of your dropshipping business is an online store. This is very vital as it is the place where customers can reach you and patronize your business. Your online store also adds to your business brand and it should contain your brand name and logo. Other features of your online store are the domain name, sign up page, and so on.
While building your store, it is vital that it is well-designed and easy to navigate. Attractiveness is also a factor that keeps people on your site. According to Forbes, about 38 percent of users will stop any form of interaction with a site if they find the layout unattractive. Therefore, you should take the development of your site with the utmost importance. This is why it is advisable that you hire competent professionals to handle the development of your site.
6. Marketing strategy
Marketing is the primary driver of any business. Without an effective marketing strategy, the growth of your business will be limited. It is not enough for you to have an amazing store and an impressive service to go with it, without an audience, it will just be another site floating around the web.
To effectively market your dropshipping business, it is vital that you choose the right platform or channel to promote your business. Fortunately, marketing can be done at no cost to you with the availability of free platforms that give you access to millions of people around the globe. Social media platforms like Facebook, Instagram, LinkedIn are excellent places to start your marketing.
According to Statista, the number of Facebook users in 2020 is projected to be about 1.7 billion worldwide. Likewise, the number of Instagram monthly users as of June 2018 was 1 billion. This tells you that marketing your dropshipping business on these platforms will greatly widen your reach without putting a hole in your pocket.
Apart from these platforms, you can also optimize your store for conversions. By following SEO practices or hiring someone to handle your store’s SEO, you can increase the number of traffic to your store, thereby leading to an increase in sales.
Influencer marketing is another popular marketing strategy that smart business owners adopt today. It is a quick marketing strategy, although it is not as cheap as using your social media platforms or generating organic traffic through SEO. Influencer marketing involves paying influencers a fee so that they will advertise your business on to their social media following. Usually, these influencers have a large number of social media follows, so they give you easy and quick access to a large audience.
One thing about retail business is that you never really know when a customer wants an order, or when someone will want to make a purchase. In order not to miss any important trade, it is vital that you are available round the clock. This is virtually impossible without any form of help, as you will definitely have to sleep at some point. Well, you could hire people but that will be quite expensive. Automation is a cheap way to make your business available at every time for any form of transaction.
Most dropshipping apps around today allow for automation. For instance, a social media autopilot is quite useful for eliminating the stress of having to posts new content on your social media platforms. You can then focus this time on other parts of your business.
There are various automation platforms available for dropshipping businesses, and they vary depending on the complexity of their functions. Automation increases efficiency because you are able to manage your time across various tasks more efficiently.
8. Customer service
Marketing brings you customers and your customer service helps you retain them. A dropshipping business without a well-structured customer service will quickly die out. This is where many dropshipping business owners often miss it, as they focus on marketing their brand to gain traffic, and providing good products to satisfy the customers.
Customer service goes beyond satisfying your customers with the products they want but extends to responding to inquiries, offering refunds, and so on. Keeping close contact with your customers is how you get them to become loyal.
If you have workers that will be interacting one way or the other with your customers, it is vital that you train them on customer relations. A simple word said or left unsaid could be what drives a customer away or what makes the customer come back. So, you have to pay attention to how you relate with your customers.
Another way to manage your relationship with your customers is by creating an avenue for them to drop feedback whenever they want. This feedback should be taken as a priority and you should make efforts to resolve any issue brought up in your customer feedback.
One thing you should always put in mind is that customers may not remember what they bought from your store but they will always remember how they were treated.
Dropshipping is one of the business implications of the ubiquity of the internet and whether you like it or not it has come to stay. The fact that small and medium-sized businesses can go into the retail industry and compete with the big boys is one of the benefits that make dropshipping as popular as it is today.
Having said all that, many people still go into dropshipping with so much enthusiasm but little knowledge. Unfortunately, enthusiasm alone does not make a business thrive. There are many things you have to consider when going into dropshipping, and we have highlighted 8 important hacks for you.
If you are about to kick off your own dropshipping business, then you are in luck, as you don’t have to make the mistakes that most of your predecessors made. If you are already in the midst of it all, it is not too late for you. These 8 hacks will help you grow your dropshipping business and carve out a reasonable space for yourself.