Answered: "How An Average Person Can Make Over $10,000 Per Month With Dropshipping"
Last week, I received an email from someone asking if he could make over $10,000 every month with dropshipping. Truth is, I receive tons of emails like this almost every week, that's why today I've decided to provide an answer to it. The answer is both insightful and inspiring. Read it below without skipping any part...you can thank me later :)
So here's the raw truth. $10,000 a month is a very achievable goal with dropshipping. I’ve seen several people get there in 3–6 months, with some making it even quicker. Most people quit shortly after trying; but from what I've seen, people who actually stick with it for at least 6 months almost always do really, really well.
Look at Society6.com for instance. They sell transparent iPhone cases for $28.79, but you can ship them from AliExpress at a cost of $2. If you’re spending $6 on ads to make each sale, your net profit is $20.79 on each clear iPhone case.
Get to a point where you are running enough ads to make just 16 sales a day and bam, there’s your $10K per month and that's 6-Figures per year! Even at 5 sales a day, you’re making an Average American’s annual income almost on autopilot.
You know the best part? People buy tons of these iPhone cases every single day all over the world! And not just for iPhone covers only, you can also do this for thousands of other products in high demand.
Let me tell you how my friend came across this. Earlier this year, She wanted to upgrade her old iPhone 5s because it was getting slow and annoying. So She decided to upgrade to a new iPhone 7s Plus.
Just after making the purchase, She came across an ad that offers transparent iPhone cases for "just" $20. She happily made the purchase! Remember she was elated that She got this offer for $20.
Now sometimes last month, She was doing something on AliExpress.com marketplace only to stumble upon this same transparent iPhone cases sold for $1.75 each! Now how about that?
You see, She didn't buy her transparent iPhone cover from Society6.com but from some little guy running a tiny dropshipping website out there. Easy peasy you say? She thought as much!
Here's The Question
That Begs For An Answer...
So you ask, how can you set this up and make $10,000 or more per month?
What if you (yes, you!) could do the same thing, and provide massive value that makes people (like me) very happy...and rake in over 10K per month in profits...almost on autopilot?
Trust me, you can do this.
But first, I'll break this process down to product selection, website build-out, and marketing in a minute but I want to make something very clear first…
Don't ever start on Amazon (or eBay).
Sure, you can do well. But there's just so much more opportunity in having your own website like Society6.com or an even simpler one. I started on Amazon a few years back and made thousands of dollars per month. However, I could have made a lot more money had I put that same time and effort into my own, separate website. And eventually I did.
Reasons why you should stay away from Amazon (or eBay)…
- People come to Amazon and eBay for deals. Not only is it far from ideal to work with small margins when you drop ship, but it's super easy for customers to compare your prices against hundreds of other competitors.
- It's hard, if not impossible, to build a brand. Branding is what makes your drop shipped product worth the price tag to a customer. Sure, you're just selling white label (unbranded) commodities with a mark-up. Commodities that can likely be found elsewhere. But branding is what differentiates you.
Professional photos, not stock photos. Cool logos, missions, values. Throwing free knick knacks in with orders to keep you on customer's minds and make them happy. But most importantly, overall design. The look and feel of the sales page - what does it communicate?
Compared to a bare bones Amazon page with a stock photo. Perceived value is everything.
- Marketing is really challenging. 2 key takeaways here: (a) People don't buy the first time they see your product, they buy the 5th time they think about it (on average), and (b) your best new customer is an existing customer. You know those ads that follow you around the internet after you visit a website? That happens because of re-targeting 'pixels' that you can easily copy & paste on to your sales pages to bring customers back. E-mail is another great way to keep existing customer and prospective customer attention. Blogs about topics related to your products also keep people around.
- Fees. Speaks for itself.
- Liquidation value. You've got a nice business up and running. Do you think that business will sell for more money if it's on Amazon, or an independent, branded store? Businesses sell for multiples of earnings, depending on risks, brand value, etc. Not only will an Amazon business's value be lower because earnings are diluted by fees, but you won't have the brand, customer retention, and growth opportunities. Plus, Amazon owns your web property, and potential changes in the way they run things pose great threats to your business. So if an Amazon business sells for 2x annual earnings and an independent brand sells for 6x earnings, (spitballin' here), $10k in profits a month would give your business a value of $240k on Amazon, and $720k independent of Amazon. That's huge. Every dollar in profits is 3x more valuable off of Amazon.
So what does it look like to dropship from your own site?
The other day I was browsing around for new product ideas. I went to Society6.com to look at what they're doing.
Here’s what their website looks like…
A quick search on AliExpress for “transparent iPhone covers” returns the following…
That’s right… $2 a piece!
Now, I suspect what Society6.com sells is exactly what’s on AliExpress and they are indistinguishable from pictures. It’s clear you can sell the ones from AliExpress for $20 to $26.99, and never hold any inventory! Just ship to your customer’s address from AliExpress.
Your customer pays you $26.99… you pay the AliExpress seller $2… and you walk away with $24.99 (minus advertising expenses).
There are lots of cool products on AliExpress that offer similar opportunity. Go ahead and browse around AliExpress, sorting by number of orders, and paying close attention to reviews. Ask yourself, what can sell for $20+ more than cost with a dedicated website, brand, nice photos, etc?
Building good website can be tough, especially because you’re starting with no tools so many different decisions to make. I've made a provision for building a well-designed, fully functioning e-commerce website for you by my own developers - at over 50% off the cost.
Everything is powered by wordpress with woocommerce by great developers, and designed by the pros. And you don't have to pay thousands of dollars for any of that.
Marketing your website…
After you've got your sales page or store up and a product or products on it, it's time to drive some traffic to that site and see if we can get any bites. You've just got to get creative here to identify cheap, effective means of getting visitors. Of course, social media pages are a good and necessary start, but 'likes' don't just come to those either.
With that said, Facebook ads is the easiest way to start. Sure, it costs money, but there’s a good chance you will make money on the campaign in your first week. At the very least, you will find out quickly what sales copy and imagery works, and what doesn’t. Then you can put all your money into the working campaign, and use that copy on your “free” marketing channels.
Facebook charges for ads on a ‘cost-per-click’ basis. You could pay anywhere from $.05/click to $10/click. Costs vary depending on who you are targeting. Everyone has a price on their head based on the information Facebook has about them.
So, at any given time, I could be targeted by 10, 50, 300, or more Facebook ad marketing campaigns. The more target audiences I’m in, the more Facebook charges to reach me (supply/demand).
So, when you sign up to run Facebook ads, you will give Facebook a picture and some ad copy, and you will tell them from all of their different targeting options who you want to target.
They will tell you how many people fit your parameters (audience size) and what the suggested max bid per click for those people are, in order to maximize your daily ad budget.
Let’s say you’re selling the Society6.com transparent iPhone covers discussed above for $26.99. They cost you $2. So, if you spend less than $24.99 on ads per sale, you make money!
If the ads cost you $0.30 per click, and you make a sale every 20 visits, that’s $6 in ad spend per sale. So you make $18.99 after product costs and ad spend on every sale! Multiply this by just 20 sales per day, that's $11,394 per month in profits!
From there, I would use Facebook and Google re-targeting ads to get my site's visitors to reconsider purchasing the product later (customers rarely buy on the first visit).
Start with just one product in a niche. Assuming all went well selling just that one product, start adding more related products and build the brand/store out. You can see how Society6.com did just that.
From here it’s all a numbers game.
What percentage of people who see my ad click it? This is your ‘click-through-rate’, or CTR. Aim for 1% or more. The higher the CTR, the less Facebook will charge you per click. Higher CTR’s also tell you your ads are compelling.
What percentage of people who visit your sales page actually buy? This is called your conversion rate. Get 500+ visitors and measure it. Then make changes to your site to try and boost it. If you’re getting 100’s of visitors and no purchases, something’s turning people off on your website.
Percentage of visitors add to cart? Let’s say 15% of visitors add to cart. Your sales page is doing it’s job. But if they don’t actually check out, what’s stopping them? Did you hit them with shipping charges? Taxes? Is your checkout process too long and demanding? Is it sketchy looking?
If I feel like I can't make the numbers work for a particular project, I just re-purpose the website to try the next product. After all, I never bought any inventory so I suffered almost no financial loss. I will often repeat this process several times before I get a big 'catch'. Then I work to get it running on auto-pilot.
Scale city, baby.
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