Dropshipping is a retail business strategy that attracts a lot of people. Aside from the unlimited earning potential and minimal investment cost, having a middleman take care of warehousing and storage is also an attractive benefit offered by dropshipping. After all, renting a physical warehouse and setting up the equipment needed to run a proper facility is pretty expensive.
Still, running an online store, whether you’re dropshipping or stocking your products at your home office, takes a lot of time, effort, and money. Dropshipping store owners will need all the help they can get to grow their business successfully. Unfortunately, many beginners fall for costly mistakes that can potentially ruin their business. Here are some tips on avoiding rookie dropshipping mistakes, mitigating losses, preventing risks, and scaling a dropshipping business effectively.
Triple Check Orders Before Shipping
Customers often order items by mistake or forget to add items to their basket before checking out. If your customer reaches out to you to update their order, you need to make sure that you coordinate these changes with your dropshipping supplier so they can fulfill the request. If your customer finds that several items are missing from their order or some of their canceled items were still delivered, they might be disappointed or disgruntled. Ignoring order changes and cancellations, even by accident, can be costly. It may result in negative reviews and loss of loyalty from your customers.
Since you’re the one in charge of sales and marketing, you need to inform the vendor of any order changes made outside the selling platform. A good solution is to create a plan to turn your customer’s negative experience around when this happens and create a process that will allow you to avoid this scenario altogether. For instance, when a customer reaches out to you after an incorrectly fulfilled order, offer them an apology and compensation to make them feel heard and accommodated. To avoid this scenario entirely, make sure you have a solid tracking system for additional order requests.
Don’t Sell Too Many Products
An amateur move in dropshipping is offering too many things at once. With the vast selection of dropshipping suppliers out there, you may be tempted to offer as many products as possible to broaden your target market. But though you may think that having many items for sale is appealing, potential customers may find it off-putting. Browsing fatigue is real, and it happens when customers scroll and scroll through endless products only to end up not finding anything that interests them. When you’re thinking of what products to sell, always remember the paradox of choice — when there are too many options, customers end up stressed, indecisive, and less likely to make a purchase decision.
To avoid this problem, pick a niche and stick to it. Focusing on a certain product category allows you to cater to a smaller but more engaged audience. It’s also great for marketing because you will be able to target the right customers better. Lastly, pick a niche that you are passionate about. Having some background knowledge about the niche allows you to curate a list of products that are more appealing to your target market.
Don’t Fall For Shortcuts, a.k.a Black Hat SEO
There are no shortcuts to success, and this applies in dropshipping businesses too. Every business owner wants clients to find their store on the first page of search results as soon as they open up. However, a reputable online presence takes time to build, and this is something that beginners should understand and accept. Search engine optimization (SEO) has been around for a while, and search engines have had more than enough time to recognize dodgy SEO tactics and penalize those who use them. Using Black Hat SEO, or the practice of increasing a site’s rank in search engines through underhanded tactics, can get your store noticed at first — but not for long.
Major search engines like Google have been cracking down on SEO violators, and the penalties are severe: be blocked or have lower search rankings. Common Black Hat SEO strategies include doorway pages, page swapping, keyword stuffing, and invisible text. Instead of falling prey to Black Hat SEO or the incredible promises of agencies that use these tactics, build up your online presence slowly but surely instead. There are plenty of skilled but honest SEO specialists out there who can create a solid SEO strategy that will get your online store steadily climbing the search rankings.
Leverage Influencer Marketing at the Right Time
Partnering with social media influencers to market products is all the rage these days. If you’re not yet familiar with influencers, they are individuals who usually have a couple thousand or million followers on one or more social media or content creation platforms like Instagram, TikTok, or YouTube. Their thoughts and opinions are highly regarded by their followers, which is why many brands collaborate with these influencers. A few seconds of video or even just one picture of the right influencer using, wearing, or buying your product can boost your sales substantially.
While influencer marketing definitely works, using this marketing tactic too early in your business’ lifecycle can lose you a lot of money. For one thing, influencer collaboration is not cheap. The more followers and engagement an influencer has, the more money they are likely to charge for every single post they make featuring your products. The return on investment is not balanced too early in the game, so use your initial marketing budget for other less costly strategies instead.
Support Environmental Causes
In the world of dropshipping, there is a lot of carbon footprint involved when products are shipped to different parts of the world. While carbon footprint is inevitable, you can do your part to help offset its effects by supporting environmental causes. There are plenty of charitable causes dedicated to planting trees, waste management, food shelters, and other similar causes.
You can also involve your customers in the goodwill by offering them a chance to contribute to your supported charities at checkout. You can also integrate donations to your store and let your customers know about it by stating that a portion of the sales of a specific product will go to a certain charity.
Sell Multi-Use, Long-Lasting Products
Sustainability is something we can all contribute to. You can be environmentally responsible and still profit by selling long-lasting products. Many people, especially the eco-conscious crowd, are turning away from single-use products as they make an effort to reduce waste. In fact, many people are willing to spend a little bit more for a sustainable, long-lasting product rather than buy a cheap one with poorer quality. While the world still has a long way to go in terms of banishing single-use items in the name of convenience, you can do your part by offering reusable alternatives.
Hopefully, the dropshipping tips mentioned above give you better insight into the common risks involved when running this kind of online business. While dropshipping might not be as tricky as other retail business structures, it’s not completely without risk. Familiarizing yourself with these risks and knowing how to prevent them can help your dropshipping store outlast the shaky first few years and reduce risks that could potentially end your business.
Catherine vanVonno is the President and CEO of 20four7VA, a trusted remote staffing company. She oversees the overall growth and success of the company, leads the short and long-term strategies, and manages the company’s finances. She also directs the management team regarding daily operations, brand management and marketing, client relations, strategic planning, and business development.