Dropshipping is a popular method of selling products online whereby the online store doesn’t need to have the products stored. Instead, it obtains the product from a third party and sends it directly to the customer. That way, the dropshipping business only serves as an intermediary.
In general, the very concept of dropshipping generates all kinds of reactions. Some think it’s an excellent way to get started in the world of electronic commerce. Others, however, dismiss it immediately having heard too many stories of scams related to dropshipping.
With so many rumors and so much erroneous information going around, it is difficult to decide what to believe and that is why you need to check out our useful guide on how to start a dropshipping business.
In addition, dropshipping can be very profitable because you do business with various suppliers and through negotiations with them, you can obtain interesting discounts for purchasing their products.
It is a popular technique used by online businesses such as Amazon, Walmart, eBay, Best Buy, and other large online stores or marketplaces to fill their customers’ orders more efficiently and with minimal risk.
So, if these business giants do it, why should you doubt if it is a good business opportunity?
How does dropshipping work?
The dropshipping model usually works in the following way:
– On your website, you promote products of the suppliers that use the dropshipping model on a regular basis.
– Customers visit your online store and order some of these products from your website.
– Customers pay you for the requested product directly on your online store and you use that money to order the product from your supplier.
– You send your customer’s shipping details to your supplier and they confirm the order details. Then, they send the product directly to your customer.
– Your customer receives the product and you get a profit for each purchase, which is usually the difference between the price you charged the customer on your online store and the product wholesales price you negotiated with your supplier.
Sounds great, right? However, as simple as it may seem, you could probably use some help, especially if you are a new kid on the dropshipping block. Take a look at this dropshipping guide to better understand the ins and outs of this business model.
Benefits of email marketing for a dropshipping store
There are many ways to promote your online store. But when it comes to having a personal conversation with your customers, these email marketing statistics speak for themselves.
For ecommerce, it has been registered that only one-third of the website traffic is made up of frequent visitors. And even for this third, you need to attract them to your website again after they have made a purchase.
And the situation is not too different when it comes to dropshipping businesses. As a matter of fact, email marketing is becoming extremely important if you want to have the best dropshipping products and store, and you would want to acquire and retain customers.
One of the best things about email marketing for a dropshipping store is the possibility to address specific segments of customers. In fact, when someone starts a dropshipping business, they usually begin carefully, gradually, and with not so many products. As a result, they need to be very specific in terms of their target audience and the content that they are going to send.
In addition, email marketing is ideal for reducing the rate of abandoned carts and sending offers of certain products that have already been viewed by your customers. Moreover, you can even use email marketing to cross-sell with personalized recommendations just like Amazon does. This will not only attract new customers but it will also retain the old ones and increase the opportunities to generate new sales.
Start a reward program for your loyal customers
If there are no people visiting your online store, it is impossible to generate conversions. And if you remember that acquiring new clients usually costs more than keeping the current ones, it is important to focus on retention marketing, since it is the best way to keep your customers coming back for more.
We are all familiar with the basics of a reward program. You buy something and you get points for that action. When you earn enough points, you get something as a reward.
However, ecommerce has opened different possibilities to create loyalty programs and integrate them into your business. Now you can reward your customers not only for purchases but for other reasons as well:
– account records
– their birthday
– likes on Facebook and other social media platforms
Another thing you could do is to create a page that shows each item related to your loyalty program. In the description, you can include the product name, what actions are required to win a reward, how many points are awarded, and how your customers can redeem them.
Include this page in your navigation menu so that it serves as a constant reminder to your customers. The more visible your reward program is, the more effective it will be.
Use multichannel inventory management
Using multichannel inventory management gives you the opportunity to reach a wider audience. Since a number of stores like yours target the same customers, settling for just one channel is not a good idea.
Here are some advantages of the multichannel approach:
– Increase your reach. You may have a great store with unbeatable prices but if no one visits it, all your effort will be in vain. On the other hand, if you sell those same products in other markets, your brand and the products themselves will get more views.
– Reinvent the usual approach. Another of the great benefits of multichannel selling is that you are the one looking for customers and not the other way around. Therefore, being present in several places will make your products more likely to raise interest.
– Understand the needs of your audience. Selling on multiple channels gives you the opportunity to store more information about your customers and their buying habits. You can use this information to design your marketing campaign or choose the sales channels you may want to switch to in the future.
Final tip – you must be an expert at problem-solving
Those who succeed in the dropshipping industry are usually experts at solving problems. As the dropshipping market grows, new problems emerge and those who know how to solve them will get a share of the market.
In addition, it is essential that you have a mindset of abundance instead of seeking instant gratification. Starting a new online dropshipping store is very similar to opening a new restaurant in your neighborhood. It takes time to achieve success and there will be a lot of problems to solve, especially in the beginning.
However, following the simple tricks that we have listed above can help you grow your dropshipping business successfully.
And one more thing – don’t be afraid of competition. Competition is good and healthy for your business and the market in general. That is why you always need to keep up with the latest trends, customer needs, and your competitors.