Dropshipping as a business model has become wildly successful in the recent years. Thanks to low barriers to entry and a large pool of opportunities, many budding entrepreneurs set up their own ecommerce stores based on dropshipping. However, as many have found out, it’s not exactly easy as pie to succeed in dropshipping.
There are numerous reasons why your store can fail, and today we’re here to outline some of the major dropshipping mistakes, as well as actionable ways to solve them.
Table of Contents
- 1 1. Going Too General
- 2 2. Thinking Too Much Instead of Doing
- 3 3. Relying Too Much on One Supplier
- 4 4. Thinking That You’ll Make Millions Overnight
- 5 5. Doing a Poor Job in Handling Order Problems
- 6 6. Not Handling Returns Properly
- 7 7. You’re Not Doing Anything Regarding SEO
- 8 8. Not Having Proper Customer Support
- 9 Avoid All Dropshipping Mistakes
1. Going Too General
Say that you’ve just started scoping out the kind of goods you want to sell in your store. You go a major dropshipping supplier website and take an hour or two. All of a sudden, you want one of everything – it’s like you’re a kid in a candy shop. Immediately you start thinking about setting up a generalist store where you will sell all types of goods, from baby toys to cleaning products and electric razors. Great idea? Not so much.
One of the first orders of business when starting out with dropshipping is picking out a niche. This is a specialized market that you want to operate in, with a very specific target audience. For example, you may want to focus on selling bowling shoes or musical greeting cards. The narrower, the better.
If you go for a general store, you will have a bigger target audience – that is a given. However, marketing to that audience is a completely different thing. It’s one thing to sell fishing gear, while selling fishing backpacks with solar charging panels is something much more specific.
The narrower you go with your target market and audience, the easier it will be to market and sell to this group. What’s more, you will also establish trust as a specialist who deals with only one type of product, instead of a more general store – which are plentiful in numbers.
One of the best strategies to selling more is knowing your target audience inside and out. The best way to do this is to sell something you’re already a customer for, something you know quite a lot about. This is useful for more reasons than one.
As you know the target market, you’ll know where to advertise and promote your products, as well as what’s currently hot. Finally, and most importantly, you’ll have more persistence selling those items that you are passionate about.
2. Thinking Too Much Instead of Doing
Once you’ve read the first paragraph, you may be thinking – I really need to take my time figuring out my niche. While that is true, sometimes budding store owners tend to overthink and get stuck instead of trying out an idea and running with it.
The best way to dip your toes into dropshipping is to start early and learn along the way. Pick a niche that you think will have a high chance of succeeding and launch your shop. You can tweak your strategies as you go, and you probably will fail miserably at least a couple of times. However, don’t be afraid – as the cost of setting up a store is so low, you have very little to lose in the initial stages.
Instead of contemplating too much, get started as early as possible so that you can learn on your own mistakes. You may pick an unprofitable niche or a marketing tactic that’s not working out – and it’s best to figure this out early on, before there’s anything significant to lose.
3. Relying Too Much on One Supplier
Dropshipping is a wildly successful business model. As such, there are thousands of suppliers out there with millions of products. Most business owners find one dropship wholesale supplier that work and suit their needs and stick with them. As clever as this is, it’s also not such a great idea in the long run.
If you put all your eggs in one basket and count on one or two suppliers, you may run into some trouble along the way. For instance, the suppliers may stop selling the items you need for your store. They could also run into shipping issues and you will be forced to stop working with them.
To avoid troubles, it’s best to put together a contract with free dropshipping suppliers as you start working, in order to ensure that they stick to their promises. At the same time, you should always have a backup in case your original supplier can no longer work for you for some reason.
At the same time, you shouldn’t rely too heavily on a certain type of product either. Some trends come and go, and an item that was selling like hotcakes one month could have no sales in the following month. While it’s great to be specific in your target market, do not rest on your laurels and think that selling one or two products is a great strategy to make profit for years to come.
4. Thinking That You’ll Make Millions Overnight
For a variety of reasons, dropshipping has become incredibly popular in the recent years. As it takes very little resources to get started, everyone with a laptop and basic IT literacy has started an ecommerce store and is already thinking that they’re the next Jeff Bezos. In reality, very few can hope to become wildly successful.
And when they do achieve success, it’s only after considerable investments in time and money. The top drop shipping companies have taken years to build the success they currently have.
Many people think that simply setting up a store is all it takes for cash to start pouring in from all sides. However, they forget that there are many non-technical aspects that need to be covered. For example, you need to do considerable market research before even putting together a business plan, let alone setting up a store.
At the same time, a huge factor in dropshipping success is marketing. Without solid knowledge of marketing, you will end up wasting thousands of dollars on unprofitable strategies that don’t work.
5. Doing a Poor Job in Handling Order Problems
One of the most common dropshipping mistakes is not handling wrong orders and cancellations properly. There will be plenty of customers who click on the wrong button, order the wrong quantity or size or you know, just decide not to purchase. The difference between a good and great ecommerce business is in how you handle these cases.
The customer is always right, no matter the type of business you’re running. And if you’re in dropshipping, that means that the third party is the one covering you for all your problems. Therefore, the customer is always, most certainly right.
Handle all mistakenly placed orders in the same way – refund and cancel them as soon as possible. If you do decide to ship, you may easily end up with a negative review, which is hardly worth the profit on one item you intended to sell. Let the item return to the dropship warehouse and you can manage with the lost profit.
6. Not Handling Returns Properly
All ecommerce store owners hope that things will go smoothly each time. The customer lands on your site, orders the goods, you get the cash and the supplier ships out. The buyer receives the items, leaves a nice review and everyone is happy. Unfortunately, this is not always the case.
Returns will happen, for some dropshipping businesses more so than others. Your customers may order the wrong size, they won’t like the item they received or it’s simply not the way they imagined it from the photos. No matter the situation, you should return the money and have the buyer return the items they purchased.
Of course, this means that you need to have a great return policy on your website, that you also put in practice. More importantly, you need to make an agreement with your suppliers on how returns will be handled, since they are the ones doing the actual shipping.
Even though you are not in charge of the returns directly, you should ensure that all returns are handled quickly and efficiently, every time. Even though they returned an item once, this type of customer can become a regular thanks to your flawless return policy.
7. You’re Not Doing Anything Regarding SEO
Unfortunately, for many dropshipping store owners, SEO is still a land of unknown and they invest very little time and resources into properly optimizing their stores. This is a lost opportunity, as doing just the basic search engine optimization provides incredible return on investment over time.
Ideally, you should start with optimization before you even launch your store. Find out the most relevant keyword opportunities and adapt your website content in line with them. Once you’ve set the direction where you want to go, it’s time to optimize your complete website, starting with website copy, all the way to technical details such as sitemap and H1 headings.
Why is SEO so helpful? Since ecommerce stores have hundreds to thousands of products, it’s really difficult to rank for a given keyword in Google with, say, a red polo T-shirt. However, if you properly optimize all of your website content, you will have a much easier time getting to the first couple of pages on Google with your product pages.
There is immense value in SEO, but most store owners give up from the start as it requires considerable efforts in time and money, in comparison to traditional marketing models. However, SEO gives a much better return on investment in the long run.
Properly optimized pages and quality content will rank for months and years, while a paid marketing campaign will only last for as long as you’re paying. While it’s alarming that most store owners do nothing about SEO, it’s also great news for you, as you have advantage over your competition from the very start.
8. Not Having Proper Customer Support
When it comes to complaints, returns, questions and all types of issues, it’s pretty hard to take care of it all if you’re running a one-man-show, although it is doable. Whether you’re doing customer support on your own or with the help of an employee is not as relevant as having customer support in the first place.
Many dropshipping business owners think that because a third party covers shipping and handling, that their work is done when it comes to customer interaction. However, if something goes awry, the first person they will turn to is you as the store owner, and not the third-party supplier that shipped the items.
For this reason, all customer support requests should be handled quickly and with great care. Never blame the third party for any issues as you are the one who needs to step up and take ownership of your business.
Finally, never stop communicating with your customers after the purchase is done. How you handle your buyers after the sale makes all the difference in whether they will become repeat customers.
Make sure to add them to your mailing list and keep them up to date with the latest promotions, discounts and sales. Great communication goes a long way. Additionally, you can retarget them through pay-per-click advertising and social media ads.
Avoid All Dropshipping Mistakes
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