Dropshipping is an amazing way to earn extra income. However, one major hurdle many new drop shippers experience right away, is deciding which dropshipping niche to sale in. Discovering the perfect dropshipping niche is the most common issues faced by new drop shippers.
When dropshipping everything has to be put in place before you drop ship on any eCommerce platform. Most business owners have a checklist. The list is marked with the appropriate entrepreneurial strategies in place as well as all the resources you needed to get started. At this point you checked everything off your dropshipping list and you feel good. Except there one vital decision to make, and that is what the hell do I sell to immediately make a hit in the niche market of choice?
A good success strategy for your drop shipping business will be to focus on a particular product that will be offered to your customers. This means you need to create a product or service that evidently stands out from the rest to capture the desired attention of the potential customers.
The following steps are easy to understand, they will be the best guide to help you decide which products should dominate your drop shipping business.
1. Identifying dropshipping product category
There are certain categories of products that have been consistently selling very well on eCommerce platforms. These products sell fast because they are necessities that appeal to different groups of people in the society. This means there is always the chance of a sale even in a highly competitive market. The list below covers the best-selling product categories that should be considered by any new drop ship start-ups.
Health and fitness/sports products.
Maternity and parenthood items.
Pet food and care.
General medical care.
Hobbies and recreation.
Now you have a clearer idea of what you will be happy selling. You should note that there are subcategories under the indicated fields. Subcategories opens up a wider range of opportunities for you to take advantage of. The most important consideration is that you have to make a choice that is in line with something you are genuinely passionate about. Working with a passion makes all the difference; you will be having a great time while earning a reasonable amount of income.
2. Identify the needs of your target drop ship customers
I just spoke about being passionate about your chosen business makes all the difference; this will complement the strategies you will need to use for this second step. Consider dealing in products that you have an extensive knowledge of. When you sell in a category that you have knowledge of you will an idea of what the customers need when they are still at the point of considering buying the product. Many of your buyers will have the same issues and the same question. Because you choose a niche you are familiar with, you will have the answers to these problems and can answer them for your buyers accordingly.
Understanding your target audience is everything. Figure out what social media platforms, blogs and forums they visit and get active and study them. The feedback and information you will get from this study will help you position your business in a way that is very inviting to your new customers, you speak there langue and understand their shopping needs.
It is also important to stay current with the latest innovations related to your business products. Your customers are keeping tabs on the release dates; you need to have the latest releases in stock at the right time to keep the customers.
For those readers who might find it difficult to identify a product niche in which they will fit in suitably, this should never be a discouragement because you can develop a passion for any niche and then perform even better while doing business in the niche. All you have to do is grow your interest in a product category and start gathering information about your choice.
3. Dropshipping product selection should be carefully done.
What you want is a product that can sell fast at a reasonable profit margin too. The first assessment you should make when choosing a niche product is the extent of competition. Competition is important. So you need to have a plan to make your products stand out from the rest. There are five basic considerations when assessing products viability. They are.
- The market competition,
- Loyalty potentials,
- Size of the product
- Return rate.
Getting into highly competitive markets might be quite difficult to break in; this will take time and resources thus increasing your drop ship start-up expenses higher than your initial budget.
Choosing a product that has already secured a tremendously high level of loyalty from existing customer might be frustrating for the business. Imagine trying to break into the cola beverage business, a niche already dominated by Coca-Cola and Pepsi, instead go for products that are not very common but useful.
Armed with the right business plan, you should choose highly priced products. These products might seem like a risky investment but if you can find the right niche, you will be eventually making more profits from every sale. Think about this, making a 20% profit from the sale of a$10 item will give you a mere $2, but imagine earning $200 from the sale of an item priced at $1,000. It is worth it. All you have to do is identify the high priced products that customers in the different product niches will be ready to buy.
Size of the product
The offer of free shipping is an age long strategy that has helped to increase the sales of many products in the market. The drawback is that for these products, the cost of shipping is calculated based on the weight of the item. So, it will be smart to choose a product that is not very bulky, because if the competition is offering free shipping your business will have to give this offer. You can always calculate the price of shipping into the final price of your product and just call it free shipping. However, this increase the price of your product making it less competitive. But lets keep it real you will still make some sales.
I will strongly advise against choosing products that have a high rate of returns. The product that customer often return is clothing. The reasons are obvious, and as much as we cannot blame the customers, you should avoid facing this headache in your new business. Clothes look good online but with the exception of shoes, they look very different on you then they do on the hot model online.
There are many gains from managing an dropshipping business. With the right information, it will be easy to strategically position your business to offer products and services that will stand out from the competition. Understanding your target market is very important. If you know what the customers need, spending time to identify how you can meet this need successfully will become your goal and achieve this goal will lead to a successful business.
Thank you for taking the time to read this post please be sure to comment below and ask questions.