Failure sometimes teaches us more than a lot of advice. However, no one who does e-commerce using the dropshipping model on Amazon prefers to learn something by losing their investment. For this reason, based on the failure stories we have compiled for you, I will mention a few important points that you should pay attention to in the construction of a successful online store.
What is Dropshipping?
First of all, we need to know the answer to the question of what is dropshipping. Dropshipping is a business model where you can sell products without physical products. In other words, when a product is purchased, the product supplier will send the product directly to the customer. So if you ask what makes this a trade, of course by raising your prices. This means that you have to set a price higher than the supplier’s price. In short, the working mechanism of dropshipping is like this: The customer buys the product from the retailer, the retailer orders the product from the supplier, the supplier sends the product to the customer.
Reasons of Dropshipping Failures
The other day, while I was browsing Reddit to read a few articles about dropshipping, I came across posts like this. I thought the best way to tell you about failures is to learn from the stories of people who have tried and failed before. I have prepared a list for you what the mistakes are at the basis of the stories of failure. Let’s take a look at the failure stories first;
An Amazon seller who chose the wrong product without doing the necessary research on product returns shared this;”Let me go. Over two years ago I started dropshipping. Selling clothes from US manufacturers and wholesalers. I used to sell on Amazon. I started slow and grew very quickly within a few weeks. I started to concentrate on Amazon as I was getting most of the sales there. I didn’t have the money to invest so whatever sales I made I reinvest it back into ordering products. Every billing cycle I would double what I made in the last one. ThenI reached around $8000 sales in 2 weeks. take into consideration that my first 2 weeks I only sold 50. Then stupid me, decided that I wanted to grow much faster, so I got 3 credit cards. contacted more wholesalers and got them to drop ship these niche clothes for me. what I didn’t know is that clothes, especially in this category had a return rate of about 50%. Returns started to come in by the 10 second. As you know manufacturers do not take returns as they sell it to us as a reseller. So as I make money. I lose it. Take into consideration that I don’t live in the US, so I had to pay a foı’warder to receive these returns and to ship them out when order is made. The rest is history now.”
Another unsuccessful story owner left a comment below this post;”Hi, I feel your pain. I have had a very similar experience and I believe it’s epidemic in the Amazon Kingdom. We see so many videos where someone has “Free product just pay shipping” or some other sales pitch, that we believe the hype. Then there are Facebook ads people keep saying to me “you need to be an ad expert” and “use your audience profile” etc but I’m not an expert and I haven’t got copious amounts of cash to give to Facebook for what? I spent $200 on Facebook ads and not one sale. I truly believe it’s the biggest rip-off of all time! Just go to the Amazon store exchange and look at the stores for sale. Even the bigger priced ones have massive traffic, then hardly any, and they all say because they run out of ad money So, I am closing my stores because I just don’t know what I’m supposed to do.”
I have prepared a list for you, what the mistakes are at the basis of the stories of failure.
1. You haven’t done enough research
Market research is the analysis of a business’s industry and ideal consumers. As an ecommerce store owner, market research can help you understand how popular a niche is and decide if it’s worth the plunge. With this knowledge, you can create a unique point of sale, product line and marketing strategy that differentiates your store from the rest, giving customers a reason to buy from you.
If you haven’t done market research before opening your online store, I can’t see a reason not to do so now. You don’t have to write a formal business plan, but a deep dive into understanding your potential customer should give you insight into what products will be popular for your target customers and how to make your online store more visible. You shouldn’t spend all of your time in the research phase, but doing some research can help you make sure you choose a profitable niche.
2.Your niche is very broad and competitive
There’s nothing wrong with owning an online store that sells T-shirts. However, if you don’t have a large-scale marketing and advertising budget, you won’t be able to rank high enough in search for such a competitive term (T-shirts) or gain recognition in such a broad category. It covers big brands such as Macy’s, Cafepress and TeePublic.
Instead of focusing on a broad, general term like T-shirts, aim to rank more specific terms like old t-shirts, funny T-shirts, custom T-shirts, and other variations specific to your products. This will ensure that your target customers – those looking for specific products you sell – can easily find you on search engines and social media.
3.Your product descriptions may not be detailed enough
Although there is no information with the description of the product in my sharing, the biggest reason for failures is inadequate product description.During your market research, you probably visited several websites of your competitor and gained an idea of how they are selling the types of products your store offers. If you haven’t, visit a few stores of your best competitor and see how they describe their product. Are product descriptions short or long? Do they offer specifications or details? Are the text sections organized in tabs or with headings? Have more than one photo or video? How do they describe the product? Are product descriptions optimized for SEO? Without giving correct answers to these questions, your online store will always lag behind your competitors.
4. You do not have the feature that distinguishes you from your competitors.
If someone asks you a question about your store and what sets it apart from your competitors, what would your answer be? With millions of search results for buying jeans online, how can you define your store to make it more interesting to your target customer?
Your store’s USP (unique selling proposition or unique selling point) is a sentence explaining what makes your store better than your competitors. Does your online store sell the most comfortable jeans on the market? The most professional? Longest life? Focus on such unique features in your marketing and advertising activities to make yourself memorable to target customers. You can also differentiate your brand in the way you provide customer service or provide value. Having the best return policy can be a very important factor that brings you to the top of your competitors, especially if you are doing Amazon dropshipping.
A good lesson must be learned from such stories of failure and the path to success must be designed to the finest detail. But Pirahas is an Amazon Dropshipping app that protects you from root causes of failures. The Trademark protection system and key store options list the products you want to sell in a few seconds for your preference. In addition, it will always be with you with its Amazon masterclass trainings and 24/7 live support service. If you want the investment you plan to make safe and want to increase your profit percentage, I definitely recommend using a product search automation.
At the same time, Pirahas has prepared a great dropshipping education model for you, the best part is that it is completely free. Dropshipping training will be your lifesaver before selling with this model. It is always risky to trade with a new model from an unfamiliar new platform. However, with the Dropshipping Training Pirahas prepared for you, this risk will now be eliminated.