Imagine being an ecommerce retailer and selling products that you don't need to have on-hand in an inventory.
Better yet, imagine never even seeing or touching the products that you sell.
This isn't some crazy ecommerce pipe-dream.
It's a popular business model that millions of online retailers are using every day, dropshipping.
Dropshipping is a Business-2-Customer (B2C) strategy that takes the Just-in-Time fulfillment strategy to the next level. The premise is simple: no inventory, no product management, and no B2C shipping logistics involved.
Successful dropshipping stores do two things, and they do them well:
Read on to learn more about dropshipping and the future of this online business model, as well as how successful dropshipping stores discover the most profitable dropshipping niches.
What is Dropshipping?
If you choose dropshipping for your ecommerce businesses, you won't be fabricating, storing, or even shipping products. Those tasks are the responsibility of your supplier.
First, you will want to decide what types of products you want to dropship. Then your next step is building a professional website and brand identity, and marketing your products to your target demographic.
Here's how it works in more detail:
Say you want to sell men's swim trunks online, and you decide dropshipping is the best model for your business.
So you find a supplier, such as AliExpress, and create a product catalog for your store based on the supplier's product availability.
Suppliers, often located in emerging economies, mass-produce their products, which allows for their per-item costs to be very low.
An ecommerce retailer, such as yourself, would then place an order with the supplier each time a customer buys a product. The supplier is then notified to mail the order directly to your customer, eliminating the storage and shipping processes entirely for you.
As you can imagine, this is why the dropshipping model is so popular.
No inventory or shipping means no overhead expenses for you.
It may sound too good to be true. But getting started with dropshipping isn't necessarily a walk in the park.
Let's discuss some of the Do's and Don'ts of dropshipping and how successful dropshipping stores distinguish themselves.
Dropshipping Do’s and Don'ts
Insufficient product quality control measures are often cited as the number one pitfall of the dropshipping business model.
In simple terms, this means that it's impossible for businesses who choose to dropship to know for sure that the products they're selling are in good condition. This is because they're completely removed from that aspect of the process.
In this regard, Just-In-Time (JIT) has an advantage over dropshipping. Ecommerce store owners using a JIT order fulfillment model have the opportunity to inspect each item before shipping it to their customers. This ensures all their products meet quality control standards.
Because dropshipping lacks this critical step, it's very important for dropshippers to have faith in the quality and integrity of their suppliers.
To account for this, successful dropshipping stores always order test samples before adding a supplier's products to their catalogs.
This requires an expense on the part of the retailer, but it can pay dividends in the long run.
Ensuring that your suppliers and products meet your quality control standards will save you time, money, and headaches down the line.
How successful dropshipping stores arise: finding your niche
Dropshipping isn't foolproof, and it's certainly not the right solution for every ecommerce store.
Success in dropshipping is all about selecting a profitable niche. This means finding items that lots of people are searching for and then marketing those items to the right target audience.
If you have an established ecommerce store that sells high-ticket luxury or customized items, then traditional dropshipping might not be right for you.
Successful dropshipping stores sell wildly popular items. They capitalize on trends and fads by understanding the most profitable dropshipping niches. So, if you sell items like sunglasses, watches, or beauty products, for example, it could be the ideal solution.
Using Google Analytics, you can easily discover products — either that you're currently selling or that you want to sell — that would make good candidates for the dropshipping model.
Take a look at Forbes Magazine's 10 most profitable dropshipping niches for inspiration.
Or scroll through sites like Flippa to browse online dropshipping businesses for sale that are already making solid profits.
With dropshipping, the sky's truly the limit.
The wild success of the dropshipping model has led to fears in the ecommerce world that the market could become oversaturated. Because of this, there's been a lot of talk about reverse dropshipping as an alternative.
And that's thanks to this newcomer dropshipping model being much less saturated than the traditional one.
The idea with reverse dropshipping is straightforward: simply reverse the flow of goods that you're dropshipping.
In traditional dropshipping models, products are usually purchased at very low prices from wholesalers based in emerging markets like China and India. They're then marketed and sold to consumers located in developed markets, like the US and Europe, often at enormous profit margins.
Reverse dropshipping stores have a 180-degree approach to the same process. They sell luxury products that are scarce or unavailable in developing markets to the emerging middle and upper socioeconomic classes there.
Some drawbacks are the many barriers to entry that can come along with reverse dropshipping, such as dealing with international taxes and tariffs or finding a marketable niche.
But the profit margins with reverse dropshipping can be equally as great as the traditional model, despite dealing with higher-ticket items.
The sky's the limit: Google Shopping powered by Kliken for your dropshipping or reverse dropshipping ecommerce store
As an ecommerce store engaged in a dropshipping business model, your only job is to market your products.
You won't need to fabricate, store, or even touch them. But getting your products advertised to high-intent shoppers can quickly lead to huge profits for you and your store.
Fortunately for you, ecommerce marketing is the business of Kliken.
We make the process of syncing your store with the Google Shopping & Ads platforms easy. So you can start running Google Ads campaigns targeted at your niche's audience almost immediately — we'll deal with the onboarding headaches.
As the world’s #1 Shopping and Ads marketing platform, Kliken has helped over 1,000,000 small businesses worldwide grow their sales on Google and get a return of up to 7x their original ad spend. Its proven marketing solutions can help you to unleash the potential of your ecommerce store.
Regardless of your business model — whether you’re dropshipping, reverse dropshipping, or something else entirely — Kliken is here to help you market your products and increase sales.
Learn more about how customers use Kliken to grow their businesses online here.
Author: Michael Arnold
Michael is a freelancer from New York City. When he isn’t writing about how Kliken unleashes the marketing, you can find him reading, writing for pleasure, or traveling the globe.
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