5 Ways To Grow Your
Drop Shipping Business In 2018
by Olga Lavrinovich[1]
Find out how to
secure jaw-dropping drop shipping profit in 2018 and further, and learn how you
can make the most out of this industry growth! “Can I make any money from drop
shipping in 2018?” “This business model exists for almost a decade, is there
any potential for growth left?”“Everybody has already started a store, can I
find a niche to benefit from?”
Have you ever seen these questions on thematic forums and in
blogs’ comments? Do you have the same worries about the future of drop shipping
business and your potential profits from it?
Fear not.
In this article, we’re going to talk about the directions you
can go to secure yourself incredible drop shipping profit in 2018. Read it
carefully to learn how exactly you can use the growth of this industry to make
money with ease!
Growth opportunity #1. Enter developing markets
Judging by numerous success stories of lucky entrepreneurs,
it might seem that everybody already does drop shipping, and the market is
overly saturated. Still, on the global scale, the percentage of Internet
retailers who primarily use drop shipping model is not bigger than 33% which
obviously means enough room for the industry growth.
As you can guess, these 33% are mostly represented by European
companies and by entrepreneurs who operate on well-developed markets with high
Internet penetration.
But is the world limited with these countries that learned about
the existence of drop shipping several years ago?
Absolutely not.
There are dozens of countries on the globe that gradually learn
about e-commerce and adopt newer technologies. If you do a little research and
target these specific regions, you are highly likely to see a huge success
of your drop shipping venture.
Why is that?
·
Internet penetration in developing countries is growing steadily
According to the data from Euromonitor
International, while the percentage of emerging and developing
countries’ population with Internet access was 34% in 2015, it’s going to reach
the level of 45% in 2020 and hit the mark of 50% in 2025. That’s an impressive
boost meaning that the number of your potential customers can rise
dramatically. In fact, the results of a survey conducted
by Credit Suisse across 9 emerging countries indicate that in case the citizens
of these countries achieve the same rate of Internet usage as the people from
developed regions, there could appear 1 billion additional Internet users. And
this is an estimate for 9 countries only!
·
Purchasing power across developing regions is rising
As a drop shipping store owner, you need to be sure that you’re
targeting people who are both willing and able to pay for their purchases.
Luckily, the inhabitants of developing regions are gradually getting more and
more affluent. In these countries, there slowly appears a segment of middle
class buyers who are likely to shop online – and they surely can become a
prospective target audience for you. Actually, an estimate from Credit Suisse
Research Institute shows that the compound online retail sales
across the emerging markets (India, Mexico, South Africa, Turkey, Russia, etc.)
could amount to $3.5 trillion annually. Naturally, as more middle class
representatives in emerging countries try make purchases online, the e-commerce
industry in these regions grows rapidly.
·
It’s easy to meet the demand coming from the emerging countries
For a number of reasons, it’s not always possible fo r the
emerging countries’ population to get some of the desired items, especially if
these are the products of foreign origin. These reasons might include
underdeveloped transport infrastructure, limited stocks, or overly high price
for these items caused by huge distribution and storage costs.
This is why online stores working by the drop shipping business
model are the perfect place for these people to make their purchases. Such
stores provide the opportunity to source the items that can’t be found
elsewhere in the country, and buy them for a moderate price – if you, as a
store owner, treat your pricing strategy right, both you and your
customers will be happy with the products’ affordability.
Growth opportunity #2. Explore drop shipping in B2B
segment
Traditionally, newcomers to drop shipping business start
with selling their items to end users as they find it easier to target and
reach these people.
For the ones who have gained enough experience or just decided
to try some alternatives, it might be an appealing idea to start working with
B2B segment, which means offering your products to businesses.
As we can learn from Kingpin’s success story, a drop shipping store
owner can do a great job collaborating with small businesses and selling
products in bulk. You can follow the example and make a good use of this market
segment because it is not fully taken yet: in 2014, the share of US B2B
businesses that were selling online was only 22% – but quite remarkably, in
the same year, the revenue of US B2B e-commerce went beyond $5 trillion.
Quite an exciting number, right? What’s more impressive, it’s
just the beginning.
It is estimated that the
global value of B2B e-commerce sales will hit $12 trillion by 2020, while the
revenue will amount to $6.7
trillion.
Analysts expect that B2B
e-commerce constitute 12.1% of all the B2B sales in the USA by 2020. It’s also
believed that this market will outperform traditional B2C e-commerce market:
according to Forrester, the B2B
e-commerce market will be worth $1.1 trillion by 2019, while the number for the
B2C market will be $480 billion.
Isn’t it a valid reason to consider making your way to the world
of B2B drop shipping?
Growth opportunity #3. Change your approach to the B2C
segment
It’s completely fine to keep working with day-to-day needs of
ordinary people and stick to the good old business-to-consumer drop shipping.
It’s a time-tested business with nice proven profitability, after all.
Still, if you want to excel yourself and reach new heights in
2018, you can heavily benefit from rethinking several important aspects of your
business approach:
·
Your product strategy
Generic and easy-to-source items might be a good solution if you
are targeting the emerging markets we have discussed above, but what about
other types of customer segments? Are you sure you’re offering them what they
actually want?
Take some time to research your target audience and look
carefully at your product offer once again. Are you selling the same annoying
basic goods as everyone does? Is it obvious for your store visitors that all
these items could be quickly found on AliExpress for a lower price? Use additional sources to
find the best items for your store, and don’t forget to evaluate AliExpress items in
detail before you import them on your website.
·
Your branding
Product range is not the only thing that matters to your store
visitors. Do you remember the primary reason why customers might prefer your
store to AliExpress? It’s all because of the atmosphere and the
sense of belonging you create there. Dedicate a couple of days to creating clear and informative product pages,
and enjoy the growth of your conversion rate – as well as the boost of
your drop shipping profit!
Growth opportunity #4. Go mobile-first
It’s not a secret that the growth of mobile technology reshapes
the online shopping industry in general.
Previously, it was more than enough to simply have a
mobile-friendly webstore to meet the public demand; now, it’s essential to
become mobile-first. If you want to achieve even more sales in your store, it’s
absolutely necessary to keep your website relevant to contemporary
technological requirements, and here is why.
·
Mobile shopping rises rapidly on the developed markets
The increase in the use of mobile devices for online shopping
was recorded during this holiday season. It is reported that
online purchases made with the help of smartphones account for 40.3% of the
total e-commerce traffic in the US, and represent 22.3% of global revenue on
the market. Analysts note that the numbers are much higher in comparison to the
results from the last year, and add that the traffic from desktop gets
significantly lower. According to earlier estimates, mobile sales
represent up to 35% of the total volume of e-commerce sales at the end of 2017.
·
Developing countries’ population predominantly uses mobile
devices
Quite often, for this category of online shoppers, mobile
devices are the only way to go online. It is reported that
consumers from the emerging countries are much more likely to use their
smartphones to shop online in comparison to people from the developed
countries. The reason is simple: for them, these devices are the only
affordable tools to get Internet access. For example, the share of purchases made
from smartphones in Brazil was 40% in 2014, and in
2015, mobile devices were used to make over 70% of online
purchases in Indonesia.
In other words, whatever type of customer segment you’re
targeting, building a mobile-first webstore with the use of a responsive
theme template is a must. This is the way you provide your
customers with a comfortable shopping experience encouraging them to come back
later for more, and this is how you generate impulse purchases that contribute
a lot to your overall drop shipping profits.
Growth opportunity #5. Automate everything
If you take a look at a typical range of day-to-day operations for
drop shipping store owners, you’ll quickly notice that the majority of these
tasks can be automated.
A wide range of issues that can be managed automatically includes:
·
And more
In other words, with the use of the right pieces of technology,
you can reduce the amount of time you’re spending on routine repetitive tasks,
and dedicate more of your attention to things that really matter.
Being able to manage your time more efficiently, you get
unlimited opportunities to reach and surpass the goals you’ve set both for your
business and personal life.
Isn’t a healthy drop shipping
profit the exact thing you’ve always wanted from your own business? It’s time
to take the action now!
Sources : https://alidropship.com/boost-drop-shipping-profit-2018/?utm_source=newsletter&utm_medium=email
[1] Olga
Lavrinovich is a content creator at AliDropship, and she aims to explain the
most complicated drop shipping concepts in the simplest terms possible.
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