What Is Dropshipping? It’s the Easiest Way to Start an Online Business!
Dropshipping is a business model that allows entrepreneurs to start an online business and sell products to their customers without ever actually stocking the items themselves.
But dropshipping isn’t a new business model.
Huge companies like Amazon, Sears, and Zappos have all used this business model for a while in their early years.
And it isn’t just the big companies who use dropshipping to start an online business – an esnimated 33% of the entire ecommerce industry uses dropshipping as their primary inventory management model.
Dropshipping is a model which has some very clear advantages, like not carrying an inventory, which allows entrepreneurs to concentrate more on important things like bringing in new customers and scaling their businesses.
Want to know exactly why dropshipping is adopted by such a large portion of businesses across the globe? In this article we’ll do a deep dive on what dropshipping is, why AliExpress dropshipping is so popular, and why you should care about this business model if you’re interested in starting your own ecommerce store.
Ready? Let’s dive in.
(video about dropshipping from Oberlo)
At this point you might be asking yourself, how does dropshipping work ?
Maybe you’ve heard the term before, or maybe it’s your first time hearing the concept – don’t worry, it’s simple to understand regardless.
Essentially, dropshipping is a business model that allows entrepreneurs to start an ecommerce store without every stocking inventory – dropshipping entrepreneurs will have suppliers who store their products in their warehouses until they make a sale.
Whenever dropshipping entrepreneurs make a sale they’ll need to contact their supplier, who will then ship their products directly to their customers doorstep.
Benefits of Dropshipping
Dropshipping is a business model which offers entrepreneurs a bunch of advantages, especially when they’re looking to start an online business.
- You control your margins – you aren’t bound to a suggested retail price (MSRP) and you can decide your retail prices on your own.
- You don’t need to be an established business entity before getting started with your store (although you will need one as you grow.)
- You have access to a catalogue of millions of products that you can add to your store through Oberlo using AliExpress dropshipping.
What Is Dropshipping?: How to Start a Dropshipping Business
1.How to Start a Dropship Business: Can You Dropship Products Easily?
Yes, you can easily dropship thanks to tools like Oberlo. Oberlo is an essential tool if you’re looking to start an ecommerce store using the dropshipping business model.
2. Will My Customers Know If I’m Dropshipping
We can’t make any guarantees about this. If you’re using AliExpress dropshipping to run your business, we recommend reaching out to suppliers to let them know that you don’t want any promotional materials included in your packages. The best way to avoid any suspicions from your customers is to build professional online store, and provide a high-quality service for your customers.
3. Why Should Someone Buy From My Store Instead of the Supplier?
Because you’re better.
Call it better marketing execution, which reached the prospective customer first.
Call it branding, which drives people to buy from you.
Call it creating a store that people trust.
Call it the value you offer by providing extra services or content.
Call it technology that allows your customers to shop more easily.
Don’t get preoccupied asking questions like “why wouldn’t customers just buy from my supplier instead?” Think about it – when was the last time you purchased products directly from a supplier rather than a brand?
4. Shipping Takes Too Long With AliExpress Dropshipping, Will My Customers Wait?
Your task is to define your shipping policy, and then display it on your store’s website to set clear customer expectations.
With the commonly favored ePacket delivery option, it typically takes only 7-14 days for a package to reach the US from China.
In addition, some suppliers keep their most popular products in US warehouses, which will mean your delivery will be even quicker.
5. What About Quality Risk and Copyright Infringements?
You’ve probably heard stories about the ridiculously bad quality of Chinese products. Sadly, some of these claims are true. As usual, though, there are two sides to every story.
In reality, you can easily run into a bad supplier no matter what their geographical location is.
In the end, you need to be cautious when it comes to choosing your dropshipping suppliers.
6. Do Dropshipping Suppliers Speak English?
When it comes to AliExpress dropshipping, lots of the suppliers who you’ll be interacting with will be Chinese, which means that their English isn’t always perfect. However, you can always contact the suppliers in advance to get a sense of their level of proficiency before doing business with them.
Larger suppliers are typically quite responsive as they’ll have sales teams managing your orders and can answer your questions via live chat or email.
7. Is AliExpress Dropshipping Favored by PayPal?
PayPal is one of the most well-known and widely used payment gateways, so it makes sense that many ecommerce entrepreneurs want to use it for their businesses.
From a customer’s perspective, PayPal is a great system as it tends to favor customers over merchants. If a customer has a payment dispute or wants a refund, for instance, it’s likely that PayPal will take the customer’s word and respond accordingly. All of this is meant to protect the many millions of people who use PayPal to make purchases every day.
In order to create a more stable and secure experience for customers, PayPal has set some precautions in place that can make using it as a payment gateway a bit of a hassle. For example, PayPal puts limitations on the money in your account in advance. These limitations are based on your business history, track record, ability to provide proof of delivery on time (via tracking numbers), your business’s physical location, and many other factors. Holds on your funds can sometimes last for months, which can end up being a problem when you’re trying to grow your business.
As dropshipping becomes increasingly more popular, PayPal is also adapting some of its policies to make it a friendlier environment for ecommerce entrepreneurs who dropship, and there certainly are merchants who have success with this option. That said, we still suggest exploring other payment gateways. Some of our top picks in this regard include Stripe, 2Checkout, and Shopify Payments. Shopify Payments in particular is a great choice if your store is hosted on Shopify because you can accept payments directly with this inbuilt system, which eliminates the complication of utilizing a third party payment gateway. Note, however, that Shopify Payments isn’t available in every country.
8. How Can an Established Business Benefit From Dropshipping?
When it comes to dropshipping, learning by doing usually works best.
Dropshipping is the ideal model for first time entrepreneurs. It’s totally understandable that an established business wouldn’t change its order fulfillment model and adapt to dropshipping, but it’s still worth considering in these scenarios as well.
Simply, dropshipping is a great model that you can use to quickly test new product ideas regardless of the size of your business.
In addition, you can add a new product category within a few days and if it proves to be successful, you can stock the products in your warehouse as you usually do. This way, you reduce the risk of stocking the inventory before knowing what sells. It increases your business flexibility.
9. How Does AliExpress Work?
AliExpress is an ecommerce website which offers a huge catalogue of products. Consumers can use AliExpress to find products to purchase online for their personal use. Entrepreneurs can use AliExpress to find and source products for their ecommerce businesses. You can use oberlo to import products directly into your Shopify store with just a few clicks. Whenever you make a sale using AliExpress dropshipping, you can then purchase your products from the AliExpress supplier, who will then ship them to your customer.
“How do I drive more traffic to my online store?”
That thought crosses the mind of every ecommerce entrepreneur at some point.
Maybe you’ve just sunk time and effort into painstakingly setting up your store, only to open up shop and wonder where your sales are. Maybe you’ve seen steady growth over the past 6 months, but just hit a plateau. Or maybe you’ve built a million dollar business and now you’re setting your sights on your next big goal.
Whether you’re trying to attract your first customer or your 10,000th customer, generating more traffic to your online store is a crucial part of growing your business. If your site is properly optimized for conversions, getting a jump in traffic could mean more customers and more sales.
To help you increase traffic for your online store, we’ve put together a list of 5 proven, high impact tactics for driving more traffic to your online store.
1. Run Paid Social Media Ad Campaigns
To increase website traffic for your online store, you need to be able to get your business in front of your ideal customers. With paid social media ads, you can create highly targeted campaigns that serve tailor-made ads to the customers who are most likely to click through and purchase your products.
If you’re thinking about running paid social media ads, here are some platforms you should consider:
Image source: Facebook
With 1.65 billion monthly users, Facebook is the largest social media platform in the world and filled with opportunities for you to reach new customers and drive them to your online store. Facebook’s robust advertising platform allows you to target users based on their interests, behavior, location, and more.
Using Facebook Dynamic Ads, you can even serve automatically-generated ads to customers who have previously visited your website, featuring the products that they’ve already looked at or added to their carts. These powerful ads can help you bring users back to your website, so that you can make the most of the traffic you’re already getting.
- An Introduction to Facebook Ads for Ecommerce
- Facebook Dynamic Ads: The Quick and Easy Way to Put Your Facebook Ads on Autopilot
- The Beginner’s Guide to the New Facebook Pixel
Image source: Adweek
Instagram is an incredibly popular platform, especially among Millennials. In fact, 73% of its half a billion monthly active users are between the ages of 15 – 35, making it the perfect choice for businesses whose target audiences skew younger.
With its recently expanded tools for business owners, Instagram is quickly becoming the platform-to-watch for social media advertising. It’s actually pegged to rake in a whopping $2.81 billion by the year 2017 on mobile ad revenue alone, beating out both Twitter and Google.
So, even if you’ve already built an army of followers on Instagram, you aren’t really using it to its full potential until you’ve tried its advertising platform.
- The Beginner’s Guide to Advertising on Instagram
- 13 Essential Instagram Tools for Social Media Marketing
Image source: Pinterest
Pinterest plays a key role in the purchasing decisions of its users: 93% have used it to plan purchases and 52% have purchased something online after seeing it on Pinterest first. It’s also extremely popularity among niche groups like DIY crafts, home decor, and fashion which is ideal for businesses hoping to make in-roads with these markets.
Pinterest is home to Promoted Pins, a form of paid advertising that pushes your Pins to the top of your customers’ search results, helping you stand out from the crowd. Promoted Pins blend in with the rest of Pinterest’s content, making them a great tool for capturing your customers’ attention and pulling them to your online store.
- 5 Powerful New Tools for Growing Your Business on Pinterest
- How One Mother Uses Pinterest to Grow Her Online Business
- 10 Ways Pinterest Can Drive Traffic and Increase Sales
2. Use SEO to Increase Your Store’s Discoverability
Can your customers actually find your store online?
When customers search for your products online, you want your store to be one of the top results for that search, especially since ⅓ of all clicks go to the first organic result on Google. That prized top position is a key ingredient for generating sustained, qualified website traffic for your online store.
Search Engine Optimization, or SEO, is the process of fine-tuning your website to increase its chances of ranking highly in search results for relevant keywords.
Free Download: SEO Checklist
Want to rank higher in search results? Get access to our free, checklist on search engine optimization.Get the free checklist
SEO is a fine science and only works when you put in time and effort into learning the rules that govern search engines like Google and Bing, so that you can apply those rules to the structure and content of your site.
- The Fundamentals of Ecommerce SEO and Best Practices for Ranking Your Site
- The Basics of Search Engine Optimization for Your Shopify Store
- Building Backlinks: The Backbone of Your Ecommerce Business
- 10 Crucial SEO Tips for Ecommerce Entrepreneurs
3. Reach New Audiences with Influencer Marketing
Influencer marketing is the process of building relationships with influencers to get your online store in front of new audiences.
With influencer marketing, you can harness the creativity and reach of relevant influencers in your industry while leveraging the trust that they’ve already formed with their audiences.https://www.instagram.com/p/BIPwoH0Adca/embed/captioned/?cr=1&v=7&wp=658&rd=https%3A%2F%2Fwww.shopify.com&rp=%2Fblog%2Fhow-to-increase-website-traffic#%7B%22ci%22%3A0%2C%22os%22%3A2397.67000003485%7D
Image source: Estee Lalonde on Instagram
Bloggers and social media celebrities like Estee Lalonde are highly trusted by their followers, so getting them to feature your products is an effective, organic tactic for increasing your traffic. According to Nielsen, 92% of customers actually value word-of-mouth recommendations from people they trust over any other form of advertising.
- The Beginner’s Guide to Influencer Marketing on Instagram
- How Blogger Outreach Can Help Grow Your Ecommerce Business
- Marketing to Millennials: 5 Massive Trends That Are Leading the Way
- Hacking the Press: Clever Ways to Get Free Press Coverage
4. Drive Excitement with Contests and Giveaways
While many of these methods may seem like long term solutions for increasing your traffic, there are ways to give your business a short term boost in numbers as well.
With viral contests, giveaways, and sweepstakes you can quickly drive more traffic to your store by offering exciting prizes in exchange for your customers’ participation. Prizes and rewards are powerful incentives for getting both current and new customers to actually visit your store.
Image source: Gleam
Using tools like Gleam or Woobox, you can embed giveaways into landing pages or blog posts on your store. These contests can even use social sharing as a method of entry, giving your sweepstakes a higher chance of going viral and spreading around social platforms. Once participants are on your store, you can use different techniques to guide them to your products, like exit intent popups featuring coupon codes.
- How to Grow Your Business with Giveaways and Viral Contests
- Are You Making These 11 Mistakes with Your Giveaways, Sweepstakes, and Contests?
5. Attract Customers with Content Marketing
Content marketing is about more than just having a blog.
By creating interesting, informative, and engaging content, you can organically attract customers to your online store. From videos and podcasts to guides and ebooks, there are endless opportunities for your business to branch out into the world of content and capture new audiences.
Original content helps position your business as an industry thought leader and build a lifestyle around your brand. Your business’ content strategy can include anything that your customers might find relevant or interesting—don’t limit yourself to posts or guides that include or focus on your products. Instead, consider any and all topics and resources related to your business that your customers would find useful.
Image source: Google AdWords
Content marketing also gives your store the chance to conquer search results beyond product and brand keywords. Using free tools like Google Keyword Planner and Keyword.io, you can identify new opportunities for your business to rank in search results and get in front of larger audiences.
- How Content Marketing Powered $2 Million in Sales for Man Outfitters
- How to Write a Blog Post That Actually Gets Read
- A Beginner’s Guide to Content Marketing
- 5 Ways Ecommerce Sites Are Killing It with Content Marketing
- 5 Genius Content Marketing Ideas You Can Steal Today
Get More Traffic, Get More Customers
With these tactics in your ecommerce marketing toolkit, you should now be able to generate more website traffic for your online store.
More traffic to your online store means more opportunities to turn those casual shoppers into paying customers. Once you’ve increased your traffic, consider trying out Conversion Rate Optimization as a next step.
Best Way To Advertise Dropshipping Store
The dropshipping model relies on eCommerce marketing and advertising more than any other type of eCommerce business. Luckily, advertising dropshipping businesses isn’t too complicated and can be made even easier by sticking to some best practices.
Here are a few tips to get the most out of your dropshipping advertising:
Use Multiple Platforms
Though it may seem obvious, the more places you advertise, the greater your chances of reaching your target market. One of the most common dropshipping mistakes is relying only on social media networks, but a multi-faceted approach offers a better return on investment (ROI meaning –
Return on Investment (ROI) A calculation of the monetary value of an investment versus its cost. The ROI formula is: (profit minus cost) / cost.). You should try to get your ads to prospective customers using social media, search engines, and email marketing. Just make sure to tailor your marketing efforts to the platforms. Not all types of ads work in every medium, so set eCommerce KPIs and track the success of your ads, then make adjustments to get the most bang for your buck.
Focus on SEO
Search engine optimization (eCommerce SEO) is the partner of paid advertising and shouldn’t be ignored. This is the natural ability of your website and product pages to appear in search engine results. The higher up your pages rank, the more traffic you naturally get and the more favorably Google treats your ads. The success of your on-page SEO for eCommerce and SEO for eCommerce product pages directly affects the relevance of your brand and your ability to increase eCommerce sales. It also signals search engines that your ads are worth showing since you already have traffic to your website. It’s best to familiarize yourself with various SEO terms.
Use Email Marketing
Though email may seem like an old-school marketing channel, it’s actually still the most successful eCommerce marketing tool. In fact, eCommerce email marketing has a return of $44 for every $1 spent, and conversion rates are higher than every other channel. Don’t ignore the power of email marketing, particularly for converting new customer leads into sales. To make things easier, look into eCommerce marketing automation, so you can set up emails that are automatically sent to customers after particular actions. If a customer abandons their cart or hasn’t purchased in a while, they’ll receive a reminder email to help make the sale, and you only have to create it once. It’s a great tool for anyone looking at automated dropshipping.
Dropshippers that sell online using BlueCart eCommerce for their digital storefront, can easily set up automated emails. it allows you to automate email sends to customers who haven’t placed an order recently to remind them to shop. This is especially great at increasing conversions when paired with abandoned cart emails. Even better, all BlueCart customers also get listed in our online marketplace where their products can reach 95,000+ buyers in the U.S.
Social media users with large followings can make or break a business in the modern era. This means they’re also great tools for promoting your business. You can do this in two ways. First, you can engage with these influencers and their fan base and hope that they notice and start buying from you. Second, you can sign a contract with the influencer for them to actively promote your product, usually receiving a small kickback for each sale attributed to them. The latter method is more effective and why people no longer have to choose between affiliate marketing vs dropshipping as they can do both.
Google Ads Vs Facebook Ads For Dropshipping
Google and Facebook are two of the largest platforms for eCommerce advertising. Most businesses advertise on both, but they also see different impacts for their ads. ROI, customer intent, ad type, and more all vary. Make sure to understand the two platforms and the markets that use them, or you could quickly eat through your budget.
Google Ads is the most used form of paid advertising for all types of eCommerce businesses. It lets you promote your business directly above, or next to, organic search results. This means you can pay to beat your competition and customers aren’t put off by in-your-face advertising. However, these ads are only useful in showing your brand to people who were already searching for a similar product or business. If you’re competing in one of the less popular dropshipping niches or don’t understand your market, you won’t be served by Google Ads. Google Ads can also become overly expensive, particularly if you’re competing with the best dropshipping websites that have deeper pockets.
Facebook Ads offer the benefits of having visual assets, video, and interactive qualities. These are particularly helpful if you sell unique products or things that are better seen than read about. They’re also much cheaper than Google Ads at less than half the cost. However, these ads have less of a reach than Google and are best suited for direct to consumer businesses, not B2B.
Google Shopping Ads Dropshipping
Google Shopping is a separate section of Google where products are listed and sold directly through the Google platform. These products appear for regular search queries, so having your products listed in Google shopping can really increase sales.
Here are a few tips on how to use Google Ads for dropshipping:
First, make sure all product information on your site is accurate. This is vital as Google Shopping doesn’t let you target keywords like regular Google Ads. Instead, it pulls all product data from your Google Merchant Center. If products are mislabelled, missing descriptions, or sold out, they may not be shown or will be viewed as misleading to your customers. This can damage your brand image, ruin your business, and lead customers to ask “is dropshipping dead?” and “is dropshipping legal”?
Second, focus on best-selling products and sales. To get the most out of your Google Shopping ads, you don’t want to list every product you sell. Instead, you should cherry-pick products that offer the best dropshipping profit margin and represent your brand. You should also take into consideration the competition you’ll face. If a big brand owns many ad slots for a given product type, it might not be worth spending ad dollars to fight them. This is key in how to make money dropshipping with Google Shopping.
Third, create a negative keyword list. You can’t target specific words and terms with your Google Shopping Ads. Interestingly, you can create a list of keywords you don’t want to show up for. This is highly recommended as it will help you avoid wasting ad dollars to show your products for terms that won’t help you sell them. Just upload a list of keywords to your Merchant Center and update it regularly to get the most out of your budget.
Facebook Ads Strategy Dropshipping
It can seem daunting trying to figure out how to run Facebook ads for dropshipping. In fact, a recent analysis found that more than 60% of small businesses have failed with their Facebook advertising. The most important thing when it comes to these ads is setting and understanding marketing goals. Are you looking to make sales from Facebook or drive traffic to your site? Is this campaign going to target existing customers or find new ones? Make sure to plan everything in advance, so it’s simple to set up and evaluate your ads as you go along.
We also recommend spending 80% of your time and ad budget on testing, with the rest spent on optimization. Try A/B testing different images, ad types, copy, and more. Once you find something that works well, adjust it to get the best results possible and keep testing other ad types. It’s no different from testing out new dropshipping business ideas. Creating and optimizing will become easier over time as you start to establish customer personas and work on demand planning.
Instagram Ads Dropshipping
Instagram ads for dropshipping are some of the most commonly used ad types. That’s because dropshipping businesses see a strong ROI from social media ads, particularly when they’re targeting 18 to 35-year-olds. 90% of Instagram users follow at least one brand on the platform and a majority of users say they’ve discovered new products on the app. This makes it the perfect choice for dropshipping ads. It’s also a great platform to connect with your customers to perform customer service for dropshipping.
The most important thing when it comes to Instagram ads is to showcase your products in an organic way. Facebook ads can get away with products on a white background, but Instagram users expect lifestyle images in their ads. If possible, try to get imagery from your suppliers with the products being used. This isn’t an uncommon request, and they likely have images you can use as long as your contract allows it. If not, order some products yourself and start photographing. This is particularly important if you perform reverse dropshipping, where imagery is key in conveying product value.
Pinterest Ads For Dropshipping
Pinterest is a unique social platform that’s built around users creating digital boards to “pin” ideas and products that they like. Many dropshippers ignore the platform, but it’s actually quite a good platform if you sell products that are visually appealing. You can run standard PPC ads on the platform, but you can also create your own board with product images and grow your reach organically. This is a great slow-burn strategy that requires little maintenance other than adding and removing products. The key to advertising on Pinterest is to let your products do the talking. Imagery is key in convincing people they need your products, so treat it as you would Instagram and try to use the most appealing images you have access to.
Dropshipping Video Ads
Video is a growing medium for digital advertising and can be used to great effect for dropshippers. Video ads are an option for most social media networks with Facebook and Instagram being the most popular. However, dropshipping businesses can have a difficult time creating these ads since they usually only have stock images of the products they sell.
The most important thing for dropshipping video ads is to understand the platform you’re advertising on. Facebook users range in age and their tastes are quite varied. Ads can be more text-heavy and descriptive on the platform. Instagram users skew younger and mostly want to see products in action. Always try to serve your market the content that they want so you can maximize your chance at making a sale and avoid damaging your brand image.
How To Make Video Ads For Dropshipping
Making video ads for dropshipping can seem difficult since you don’t actually stock the products, so you can’t just film them. There are two ways around this limitation. First, you can coordinate with your vendors to get your hand on imagery and footage that they own. Many suppliers will shoot their own imagery to share with dropshippers and retailers, so they can continue to sell more products. If you take this route, you’ll still want to touch up the content and splice it together to create a cohesive ad. These ads are usually less than 60 seconds long, so you don’t need many assets.
The second way you can make a video ad for dropshipping is to buy one of each product from your supplier or request samples. With products in hand, you can shoot your own footage and edit it into an ad. This gives you far more control over the content and lets you add branding very easily. However, this may cost you additional money and takes more time and skill to create.
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