- You know what?
Despite the several successful drop shipping case studies
on this channel, I still occasionally get people
leaving comments like,
"Drop shipping is dead,
"if it ever was properly alive to begin with."
"increasing ePacket rate, it literally kills drop shipping."
"It's too late for this business."
"Most businesses fail.
"I will never waste my time and money trying
"to start a business ever again.
"And if you're smart, you'll do the same thing."
Hmm, yeah, well, okay.
Obviously I strongly disagree with those comments.
Because here's the thing,
a lot of people will say things like
drop shipping is dead or it's too late
or businesses don't work,
and the reason why they're saying these things is
because they are making several assumptions
that are all wrong.
And so if you are looking to start a store,
it's crucial, then, that you understand
what these assumptions are before you start drop shipping
so that, unlike these people, your store can be successful.
Because no, it is not too late.
One, people won't buy from you.
They'll just buy from Amazon instead.
"But wait, Sarah," you ask,
"Why would anyone buy products from me
"if they can buy products directly from Amazon themselves?"
Now, it is absolutely true
that if you head on over to Amazon
that you will find lots of products
that can be purchased directly from AliExpress
searching on Amazon's digital shelf as well
and, of course, if customers were to purchase your products
on Amazon they would then get to take advantage
of the Prime two day shipping.
So how on Earth could drop shippers successfully
drop ship these guitar coffee spoons
with two to three weeks shipping
via China's cheapest, fastest shipping option, ePacket,
when the customer could come and buy them on Amazon
with two day shipping?
I mean, come on, Sarah.
Just think about it.
Amazon is only growing in Q3 2019
their product sales were up over 17%
from the same time in 2018.
Won't Amazon steal away all of our sales?
No.
No, they will not.
You see, here's the thing.
There is some truth to these comments.
Amazon is, arguably, the better deal for USA citizens.
It is better for the consumer
to purchase the products on Amazon.
So if they figure out that the product
that you are selling them is, indeed,
on Amazon for purchase, you can bet
that Amazon will take that sale away from you.
But you know what?
We literally don't care.
And you know what, drop shippers never have.
The sorts of people who see a product
and decide that they're gonna research
the absolute best deal for it
were never our customers in the first place.
Nope, it's the 44% of people
that impulsively purchase products online
that we are targeting, and, of course,
as shown by how Millennials are even more prone
to impulsive purchases with 80% of them
impulsively buying products,
the overall percentage of impulse eCommerce purchases
for us to target as drop shippers
is only growing and growing.
You see, successful drop shipping stores
are built around that type of customer,
the type of customer
that enjoys impulsively purchasing products.
It also means that successful drop shipping stores
are usually built around selling products
that spike an emotion in a customer
that makes them think I need to buy this right now.
It's why this AliExpress dog collar
has made hundreds of thousands of dollars.
The advertising drop shippers used spiked fear
in dog owners, pointing out how many dogs die
in car accidents each year from not being seen.
That is why when recently I saw this comment
from this viewer, asking why their online store
wasn't successful, I pretty much instantly knew
that the store would be selling extremely boring products
and lo and behold, I was right.
Now, of course, this is actually a print on demand store,
not a drop shipping store,
but the exact same principle applies.
Why would somebody want to buy this hoodie
when they can go to Amazon and find cheaper hoodies
and shirts with inspirational messages on there?
Because here is the reality.
Typing vision in a plain white circle is not exciting.
So, let's compare this hoodie to this hoodie.
What is the difference between the two?
Well, the difference is that one hoodie is very boring
and the other is extremely interesting, unique,
and unlike anything people are likely to have seen before,
which is why this hoodie's Facebook advertising campaign
made so much money for the successful AliExpress
drop shipping store, Freaky Pet.
And, of course, if you're ever wondering,
this exact same answer applies
to the people that ask the question,
"Why would customers
"not go directly to AliExpress themselves?"
Well, again, it's because good AliExpress drop shippers
sell products that trigger emotions in people
and get them to impulsively buy their products
so that they never even think
to go check if a product is on AliExpress
because they see and go, "That's so amazing!
"I must buy one now!"
And by the way, if you have learned something
from this video and you would like to learn even more
about starting a successful drop shipping store,
then be sure to subscribe and click
that little notification bell next to it
so that you don't miss out on any of our videos.
Two, drop shipping is a scam.
I just wanna quickly address this
because these comments are really dumb.
You know, you might've noticed
that earlier in this video I freely admitted
that it would be a far superior financial choice
for a customer to buy this hoodie on Amazon
with two day shipping for a fraction of the price,
compared to what they would pay for it on Freaky Pet.
And so what do people say to that?
Oh, the customer can get it cheaper elsewhere quicker?
That makes your store a scam.
Nope, it does not.
Number one, if it weren't for your Facebook ad,
the customer would never have known about their product
that they really enjoyed getting in the first place.
People really love this hoodie
and were really grateful that it was advertised to them
and they bought it.
You had to pay for that advertising to do that,
which you pass on to the customer.
Amazon doesn't advertise products.
Customers have to find them themselves.
And number two, as an entrepreneur,
you are in no way obligated
to offer your product for the lowest price.
Here are two coffee shops
around the corner from my apartment.
They are across the road from each other.
I walked into coffee shop A and bought my favorite coffee,
a long black for $3.
And yes, I know, that overseas the phrase long black
might conjure up some different thoughts,
but here in New Zealand and over in Australia too,
a long black simply refers to pouring an espresso shot
over 100 to 120 mils of boiling water
to create a stronger version of an Americano with creamer.
Next I went into coffee shop B
and again ordered a long black.
But this time it cost $4.
Completely different prices
for an extremely similar product.
And you know what?
Coffee shop A's $3 coffee was the best.
Would you say that coffee shop B is a scam
for charging a higher price
for a worse version of this coffee?
No, you would not.
Pricing is entirely subjective,
and it's actually determined by the customer, not you.
You present the customer with a price,
and it is up to them to decide
if that price is worth it or not.
And at the end of the day, if Freaky Pet are able
to create a marketing campaign
that gets people to purchase their hoodie
for a higher price while being entirely up front
about the shipping times,
then they 100% deserve that sale.
Three, drop shipping is saturated.
Perhaps the most bizarre of all the claims
is that drop shipping is dead and it's over
since, well, it's saturated.
And the truth is, when I see comments like this,
it blows my mind
because this comment literally makes no sense.
Here's what market saturation literally is.
It's when a product has been maximized in a market.
In other words, when all other people
who would want that product have bought it already.
And here is what drop shipping is.
Drop shipping is when a customer buys a product
that you've listed in your store for a markup price.
When they do, you go to the manufacturer
and you purchase that one product for the wholesale price
and then have them ship it out directly to the customer
while you keep the difference as profit.
And large retail stores have been drop shipping for years.
Drop shipping isn't a product.
It's simply a way to fulfill products.
Only products can be saturated.
And so whenever you see someone equate the two
in the YouTube comments section,
you can be sure that they don't understand
what they are talking about.
So Sarah, you say, maybe drop shipping can't be saturated,
but are all of the AliExpress products, instead, saturated?
The answer here is nope.
Although yes, indeed some are saturated,
and surprise, surprise, it's the products
that pretty much everybody is trying to sell.
Do you know what's saturated?
Cheap women's apparel and accessories.
And do you know what the number one
AliExpress drop shipping store
I see people trying to create is?
If you guessed cheap women's apparel and accessories,
you would be correct.
And this viewer posted their comment for me
to review their store, literally on a video
where I talked about how generic women's watches
is a terrible, saturated niche.
And here is the thing, these products
that are saturated on AliExpress,
these saturated product niches,
they are saturated regardless
of how you fulfill your orders,
which is why one of the biggest retailers
for this niche, Forever 21,
recently filed for bankruptcy.
The reason their store chain failed
wasn't because of their method of fulfillment.
It was because their niche was too competitive
and too saturated.
And so, to survive in it,
you needed to be extremely skilled,
and they were not skilled enough
to compete in such a cutthroat market.
Saturation is a product problem, not a fulfillment problem.
The solution?
Sell unsaturated products,
regardless of how you're fulfilling your orders.
That's exactly why Freaky Pet had such huge success.
They found a product that few people were selling,
and they put it in front of the people
that would love to buy it.
Choosing products like this is something I focus on
in my premium, curated drop shipping course,
the Ecomm Clubhouse, and if you're interested,
I have a link to it in the video description below.
Four, Donald Trump's war
with China has killed drop shipping.
So, if you haven't heard the news,
Donald Trump announced the end to ePacket,
the cheapest, fastest shipping option from China to the USA.
Packages could arrive in as little as 10 days
halfway across the world for just $2,
an absolute steal.
And you know, not a lot of people know about this,
but for over 190 countries,
the international postage rates are mostly negotiated
and set by a worldwide organization, Universal Postal Union,
known as UPU.
And historically, the prices have generally been set
by how poor a country is considered to be.
If they were rich, like the United States,
then they had to pay higher prices.
But if they were poor,
then they could have lower shipping prices
to stimulate economies.
And so, because in the past China had a lot of poverty,
they were able to successfully negotiate with the UPU
a very low postage rate.
And, of course, as you can imagine,
having a low cost, fast shipping option from China
made drop shipping from China much, much easier.
But, then in 2018
something completely unprecedented happened.
Noting that China's financial fortunes
have drastically changed over the past little while,
as part of the ongoing trade war,
Donald Trump threatened to pull the USA out
of the UPU unless the rules changed
and they could declare their own shipping prices for China.
Now, as you can imagine, if the United States,
arguably the biggest economy in the world,
were to pull out of the UPU,
that would mean 190 countries
would suddenly have to negotiate their own shipping rates
with the United States,
and that would be an absolute disaster.
Donald Trump gave an ultimatum.
The UPU had 12 months to implement this change
or they'd be gone.
Well, it's over a year later,
and ePacket is still here.
And the United States, they're still in the UPU.
So what happened?
How can both of these two things be?
It's because the Universal Postal Union scrambled.
They held an emergency meeting in September 2019,
and they struck a deal with the USA.
The United States can now charge
up to 70% of the postage rate,
i.e. if the price of an ePacket shipment was previously $2,
they can now charge $4.
Not exactly the literal death of drop shipping,
is it for a business that was already working
on 20 to 25% profit margins.
And honestly, when I saw the news, I pretty much shrugged
because I was like, you know what?
Even if ePacket disappears, there is absolutely no way
that China Post is not going to come up
with their own alternative,
which is exactly what they did.
There is now a new shipping option being rolled out.
AliExpress standard shipping, which surprise, surprise,
is a near clone of ePacket.
And as a further back up, more and more AliExpress suppliers
are opening up their own fulfillment centers
in the United States,
which means that you can now drop ship products
with four to seven day shipping times for four to $5.
Five, most people who drop ship will fail.
So, a few weeks ago I made a video tutorial,
which show people how to drop ship products
from AliExpress with four to seven day shipping times.
Well, someone came in and made this comment.
"Why don't you mention the roadblock everyone hits,
"which is marketing, causing 99% to fail?"
And I was, admittedly, a little bit snarky.
And I was like maybe the reason why I didn't mention this
in the video was because that video was, you know,
about something else.
But, I do understand why that comment was posted.
Because do you know what 99% of gurus won't tell you?
They won't tell you that 99% of people will fail.
But you know what?
On this channel, I don't shy away from it.
It's absolutely true.
Oh my goodness, Sarah!
A 99% fail rate?
That's insanely high!
Why would I start one?
Well, what I would tell you
is that the main reason why 99% of people fail
is extremely avoidable and really easy to not do yourself.
Because I'll tell you this now.
The main reason why 99% of people fail
is not because they don't have enough knowledge
about Facebook ads.
Oh no, in the internet video age,
we are swimming in knowledge.
We are practically drowning in it at this point.
You can purchase a curated video course
like The Ecomm Clubhouse or you can watch a series
of disorganized YouTube videos.
Either way, the knowledge is out there.
What those 99% of people are missing
is the knowledge that you gain
through going through the learning curve
of actually marketing your products to consumers.
Real talk, you can not bypass this.
There is absolutely no guru that you can follow
that will allow you to somehow bypass this.
Now, let me ask you a question.
If you read these five books on being a barista
after never having made a coffee in your life,
do you think that you'd make the perfect latte
on your first day on the job?
Nope.
And if you read these five books on cooking
after never having cooked a meal in your life
that your first dinner would be a fine dining masterpiece?
Nope!
I am sure that everybody watching this video agrees.
If you want to cook well,
it doesn't matter how many books you read.
You need to practice and make many meals
before you get good.
So why on Earth, then, do people think
that there is some formula that some guru can teach them
that will mean that they can get really good
at marketing fast without having
to put in experience actually doing it?
And every day, I see so many people
that seem to be searching for that.
But that's not how it works.
Sure, reading these books will definitely help you
make tastier meals faster.
But none of them are a replacement
for the real world experience gained from actually cooking.
Run ads, see how people interact with our ads in your niche.
Make changes based upon how people interact with them.
And you know what?
Every single person's learning curve
is going to be unique to them.
But most people want fast, easy money,
not to actually learn how to make real money.
And so when they don't get it fast,
they usually do the one thing
that guarantees a 100% failure rate,
and that is giving up.
So if you don't wanna be part
of that 99% failure rate, that's fine.
Don't come and ask me questions
like is $200 enough to invest?
Is that enough money for me to start making money?
Or asking me how long is it going to take me to make money?
Is it gonna take me two weeks?
Is it gonna take me three weeks?
I can even wait four weeks.
Four weeks is fine if it's gonna take four weeks.
No, don't ask me those questions.
Instead, ask yourself the question
that that 1% who have success ask themselves.
Am I willing to invest the time and money that I need
to overcome the learning curve of marketing and sales,
learn from my mistakes, and ultimately be successful?
Am I willing to do what it takes for me to succeed?
Thanks for watching my video.
I have you appreciated the honest advice.
And if you would like to learn even more
about drop shipping, you should download our free ebook,
"The 6 Steps That 6 Figure Online Stores Follow
To Make Over $10,000 A Month",
and you will find a link to download that ebook
in the video description below.