6 Tips for How To Be a Successful Dropshipper (2023) - Shopify UK (2024)

Dropshipping isn’t dead. In fact, the opposite is true. Dropshipping accounts for $85 billion in annual sales, responsible for 23% of all ecommerce sales. These stats indicate we’re in a golden age for ecommerce entrepreneurs.

But using the dropshipping model isn’t easy. Most people think you just add products to your online store and customers come to buy.

Dropshipping without a business plan can make you feel invisible. You feel like you’re shouting into an empty room where nobody is listening. Every dropshipper, big or small, knows this feeling. It’s a part of the process that most entrepreneurs want to escape as fast as possible.

Luckily, there are ways to become a successful dropshipper, which is why we created this guide. Read on to learn from expert dropshippers what success looks like and how to achieve it.

What’s the average dropshipping success rate?

Top dropshippers from around the web estimate that between 10% and 20% of dropshipping businesses succeed. Yet success is only defined by the owner, which is you.

If success to you means making $1 million per year with your dropshipping store, then it may take a long time to be “successful.” If your idea of success means breaking six figures, there are many dropshippers making $100,000 per year, you just need to find good dropshipping suppliers and build a brand.

This online business model is often seen as a get-rich-quick scheme. But it’s not. To see dropshipping success, you’ll need to put in hard work and time to make your business profitable.

Dropshipping success stories

• Tze Hing Chan: $19,000 in profit over two months
• Cole Turner: $2 million in just over one year
• Andreas Koenig and Alexander Pecka: the $10 million per year mark
• Sarah and Audrey: $1 million in sales through influencer marketing

Starting a dropshipping business can be competitive. The dropshippers are always coming up with new and innovative ways to stay ahead. So what are they doing that others are not?

Let’s learn by example from the following top Shopify store owners using dropshipping in their businesses.

Tze Hing Chan: $19,000 in profit over two months

Our first case study comes from Malaysian entrepreneur Tze Hing Chan, who ran the Shopify dropshipping store Subtle Asian Treats. It’s the go-to store for bubble tea plush toys and other hand-picked cute merchandise. Started during the COVID-19 pandemic, Tze made $19,000 in profit in just two months of dropshipping bubble tea plush toys.

But he didn’t go straight from dropshipping to making bank. There were many failures and lessons along the way. Tze started selling phone cases, then moved on to kitchenware and martial arts products before finding his most profitable product idea: plush toys.

Lessons learned:

Choose a trending dropshipping niche

Tze knew that bubble tea was up and coming within Asian communities, so he looked for bubble-tea-related products on AliExpress. He started selling bubble-tea-themed phone cases—they were good things to make and sell—but he didn’t see good profit margins.

Create a professional store

Tze made sure to take care of his store. He edited each product photo and wrote compelling product descriptions. He wanted to replicate the look and feel you get from stores like Nike and Adidas.

Interact with customers

Tze also was transparent in the buying process with customers. His product pages included shipping times and origins of the products, so customers had the right expectations. He also took time to engage with followers on Facebook and Instagram, building relationships with people and influencers. He also kept support response times low so customers never felt they were dealing with a scam site.

There’s a lot to take from Tze’s experience as a dropshipper. Learn more by reading Luck and Learning From Failures Led This Entrepreneur to Make $100K From Bubble Tea Plush Toys.

Cole Turner: $2 million in just over one year

After hearing about dropshipping when he was 18, Cole Turner became obsessed with learning how to sell online. In just four years, the young entrepreneur built an ecommerce store that made over $2 million in sales between March 2019 and May 2020.

Cole first built a general store to test a variety of products. He eventually found a piece of jewelry that grabbed shoppers’ attention. He quickly scaled up Facebook ads and worked to redesign his general store and turn it into a one-product shop. That one store netted him over $75,000 in sales before he sold it to another ecommerce entrepreneur.

It wasn’t until his third dropshipping store that he brought in over $2.1 million in sales in just over a year.

Lessons learned:

Scale Facebook ads

Cole generally uses Facebook advertising as his primary sales channel. He starts by identifying two different groups interested in a product and targets ads at them. Then he collects enough data to see which group the ads worked best on, and increases his budget.

Build a long-term brand

The only way a store can compete today is through brand identity and unique selling propositions. Even if you are shipping from AliExpress, you need to look and feel like a legitimate business. People need to trust you.

Provide good customer service

One way to build trust with customers is through excellent customer support. Cole adds a phone number for customers to call or text with concerns or questions, along with available support times. During business hours, all queries are answered within 30 minutes of receiving them, which makes customers feel heard and valued.

Learn more by reading Meet The College Student Trying to Graduate While Building a Million Dollar Empire.

Andreas Koenig and Alexander Pecka: the $10 million per year mark

When Andreas Koenig and Alexander Pecka first started dropshipping, their goal was to hit $1,000 per day in turnover. After a year of trying and making no money, they found their niche in the pet industry and started making $500,000 per month as of 2019.

Today, Andreas and Alexander’s pet business is making over $10 million per year.

Lessons learned:

Choose a niche based on people's emotional connections

If you choose a niche based on people’s emotional connections, like pets or children. They are more likely to buy and see your product as differentiated, even if it might not be.

Learn how to use Facebook ads and organic marketing

Marketing through Facebook ads and organic marketing are likely to garner you success when dropshipping. Andreas and Alexander’s first ventures failed because of lack of advertising and marketing experience.

Invest time and energy into dropshipping

Dropshipping needs a sales and marketing strategy, like any other business. If you don't have the time to invest in the business, consider waiting until the timing is right. Remember, it’s not just setting up a website and waiting for people to find you to buy your products.

Don’t reinvent the wheel

See what works in your niche, make a better version, and become a market leader.

Build good relationships with suppliers

Your suppliers because are crucial to running a successful dropshipping business. Make sure you find suppliers you can trust.

It takes time to succeed

Don’t expect to make money in the beginning. Never give up.

Want to bring in $10 million per year dropshipping? Learn more by reading Making $10 Million In One Year With Dropshipping.

Sarah and Audrey: $1 million in sales through influencer marketing

Sarah and Audrey are two French ecommerce entrepreneurs recently profiled by Oberlo. The two women, 25 and 26 years old, respectively, each started a dropshipping business before joining forces in 2019.

The typical sales channel for successful dropshipping is Facebook ads, but these two women saw the potential in influencer marketing, which proved to be profitable in the long run.

After meeting at an entrepreneur event, Sarah and Audrey worked hard to expand their brand into the US market. They worked with influencers on Instagram and numerous product placements.

The pair were wildly successful during US lockdowns, bringing in over $1 million in sales in just a few weeks through their dropshipping business.

Lessons learned:

Design a website to appeal to your audience

Consider your target audience and their preferences, so that it attracts and appeals to your target audience.

Work with as many influencers as possible

Influencers can make all the difference to your success. Sarah and Audrey sent up to 200 emails per day looking for the perfect influencer match. Try to establish direct relationships with influencers, eschewing agencies.

Use Instagram Stories for product placement and promotion

Once you establish relationships with influencers, use their most effective platform to promote your products.

How to be a successful dropshipper

Inspired and ready to become an ecommerce entrepreneur yourself? Here are six key elements you’ll want to master to become a successful dropshipper.

1. Add value
2. Focus on marketing and SEO
3. Specialize
4. Have a long-term perspective
5. Offer outstanding service
6. Don’t get hung up on the details

1. Add value

Having a solid plan for how you can add value for your customers is the most crucial success factor. This is important for all businesses, but much more so in the world of dropshipping, where you’ll be competing with legions of other “me too” shops carrying similar products.

With dropshipping, it's easy to think you’re selling customers a product. But successful small merchants understand that it’s not only the product they offer—they’re selling insights, information,and solutions. You think you’re an ecommerce merchant, but you’re also in the information business.

So how are you going to add value and help solve problems for your customers? If you’re unsure, spend some time reading about dropshipping niches to understand the best ones in depth. If you’re struggling to answer this question for a given niche, you may want to consider picking a different market.

If you’re not able to add value through quality information and guidance, the only thing you’re left to compete on is pricing. While this has been a successful strategy for Walmart, it’s not going to help you build a successful dropshipping business.

2. Focus on marketing and SEO

Coming in a close second to adding value as a key success factor is being able to drive traffic to your new site. The #1 problem and frustration new ecommerce merchants face is a lack of traffic to their websites. Too many merchants slave away for months on the perfect site only to launch it to a world that has no idea it exists.

Marketing and driving traffic are absolutely essential to the success of your business and are difficult to outsource well, especially if you have a small budget and are bootstrapping your business. You need to take the personal initiative to develop your own SEO, marketing, outreach, and guest-posting skills.

This is particularly crucial during the first six to 12 months, when no one knows who you are. Following your site launch, you need to dedicate at least 75% of your time on marketing, SEO, and traffic generation for at least four to six months—that’s right, four to six months. Once you’ve established a solid marketing foundation, you can scale back and coast a bit on the work you put in. But early on, it’s impossible to place too much emphasis on marketing.

If you’re not a marketing or SEO expert yet, the following resources and blogs are a great way to get started:

SEO resources

• Moz. One of the most popular SEO communities online. beginner’s guide to SEO is a particularly great resource for those starting out.
• Seach Engine Land. An extremely prolific SEO blog, with dozens of new posts each day.
• SEOBook. A popular SEO blog and the home of a paid private community for SEO professionals.
• Brainlabs. This marketing and SEO agency has a top-notch blog and a number of high-quality training courses and tutorials, many of which are free.

Marketing resources

• HubSpot blog. Advice on everything inbound-marketing related, from driving traffic with email to social media tips.
• Seth Godin’s blog. Solid high-level advice on marketing and building an audience.
• Copyblogger. Content marketing tips with an emphasis on writing effective, compelling copywriting.
• Mixergy. Interviews with successful entrepreneurs in the technology and online fields. Not focused exclusively on marketing, but lots of applicable information for aspiring entrepreneurs, including marketing and early-stage advice.

Ecommerce marketing resources

• Shopify blog. A comprehensive ecommerce blog with frequent posts on how to effectively promote and market your online store.
• EcommerceFuel. Tips from an active ecommerce entrepreneur on how to found, grow, and market online stores. Written specifically for individual store owners and smaller stores.

3. Specialize

Almost every successful dropshipping store we encounter has one thing in common: it specializes in a certain product or niche. The more that stores specialize, the more successful they tend to be.

You don’t want to just sell backpacks. You want to sell backpacks designed for around-the-world travelers obsessed with lightweight gear. You don’t want to just sell security camera equipment. You want to focus on security systems for gas stations.

Many think narrowing their focus limits their potential customer base and will cost them sales. Just the opposite is true. Specializing allows you to communicate more effectively with your customers, stand out more easily from the competition, and compete against a smaller field. Specializing is rarely a bad move to make in a dropshipping venture.

If you’re launching a store in a new niche you probably won’t know what segment of your customers to focus on, and that’s OK. But as you gain experience with your customers you should identify the segment that’s the most profitable and that allows you to add the most value. Then, try positioning your business to focus exclusively on those customers’ needs and problems. You’ll be amazed at how your conversion rates skyrocket, even if you're charging a premium price.

Remember: if everyone is your customer, then no one is. Specialization makes it easier to differentiate yourself, charge a premium price, and concentrate your marketing efforts more effectively.

4. Have a long-term perspective

Building a dropshipping business is like building anything else of value: it takes a significant level of commitment and investment over time. Yet for some reason people assume they can build a passive six-figure income with dropshipping after a few months of part-time effort. That’s just not the way it works.

It will realistically take at least a year to build a business that generates an average full-time income.

It's also important to understand that the first few months are the most difficult. You’ll struggle with doubts, run into issues with your website, and likely have an underwhelming website launch that generates zero sales. Understand that this is normal. Rome wasn’t built in a day, and neither were any successful dropshipping businesses.

If you mentally prepare for a challenging beginning and don’t expect to get rich overnight, you’ll be much more likely to stick with your business until it becomes a success.

5. Offer outstanding service

The Internet has always been a fairly transparent place, but the recent rise of social media has made your business reputation even more important to your success online. If you don’t treat your customers well, they’ll often let the entire world know—including many potential customers.

The biggest customer service risk for dropshipping merchants is having tunnel vision on per-order profits and losses when fulfillment issues go awry. As discussed in our Amazon dropshipping guide, it’s critical to accept that dropshipping can get messy, that you’ll be paying to clean up some messes, and that you shouldn’t always try to pass those messes on to your customer. If you aren’t occasionally losing money on individual orders to make customers happy, you’re probably not providing very good service.

Having happy customers is the best form of marketing. As is true in all businesses, it’s much easier to make a sale to a satisfied customer than to try to convince a new prospect to buy. If you treat your customers exceptionally well, they’re likely to spread the word and refer others your way. With top-notch service, you can build a business where repeat customers generate much of your revenue.

Making customer service a priority sets your dropshipping business up for success, so ensure it’s a priority from the outset.

6. Don’t get hung up on the details

Don’t focus too much on the details. Your company name, logo, theme, or email marketing service aren’t going to determine your success.

What makes a business successful are the things we just talked about: adding value, marketing, outstanding customer service, specializing, and a long-term commitment. Still, new merchants will spend weeks, sometimes months, struggling to make a decision between two shopping carts or providers. That’s valuable time better spent developing the core aspects of the business.

Do your research and make an informed decision, but don’t let small decisions paralyze you.

The most important step to successful dropshipping

The most important step—the one that most people never take—is to actually get started building your ecommerce business. This is the hardest thing for most people, usually due to fear and uncertainty.

It’s a common misconception that successful entrepreneurs have a rock-solid certainty about their business at the outset. When you dig a little deeper, you’ll find that most had fears and reservations about how things would turn out. Yet they moved forward with their plan despite these doubts.

If you’re serious about building your own dropshipping business, you’ll need to do the same. Do your research, evaluate your options, and then move forward with that information in spite of your fears and reservations. It’s what entrepreneurs do. Start now.