5 Hints That Your E-Commerce Competition Is Weak (And The Niche Is Viable)
Let’s talk about e-commerce and dropshipping.
I have – in the past – been tempted to be mean about the wantrepreneur dropshipper crowd.
That’s because most of them are dumb and looking to make money without doing anything of real value.
Recently, one tweet of mine caught the eye of my friend James. He messaged me and we had a quick chat about dropshipping and e-commerce.
Let me clarify a little here.
E-commerce is an awesome business thing to build. Compared with the headache of building authority sites or affiliate marketing, e-commerce is easy. You build a site; you sell products and you love life.
Added to that, keywords are easier to rank for, you don’t have to constantly produce new content and as always, there are millions of good examples which you can borrow ideas from and “be inspired” by their business models.
Dropshipping is fine as part of a bigger strategy. If you can avoid holding tons of stock, then that’s great because it lowers your overheads and, whilst it makes stuff trickier logistically, in many cases that’s worth it.
So, you might ask, what is my problem with the dropshipper crowd?
There are a lot of people who are terrible at it. Like affiliate marketing, it’s got the street-cred of “business model you can use if you just want to make a ton of money without doing any work or knowing anything.”
I don’t recommend starting any business without knowing what you’re doing or having a good plan of attack.
But let’s assume you do know what you’re doing and you do have a good plan of attack.
What signs can you look out for that are good indicators of future success in a niche as far as competition/demand goes?
Let’s find out.
1. People Actually Buy It Online
This isn’t really a massive secret… but it’s something you see quite often that people do wrong.
There’s absolutely no point in trying to set up an ecommerce store in an area where people don’t buy online. Sure, you might be the first to corner the niche… but it’s unlikely.
There are items which people buy in a store. Yet still millions of people flock to these niches. They probably won’t be profitable.
Thousands of people try dropshipping things like bicycles for instance. Not many people buy bicycles online unless they’ve already tried them out at a store. Why? Because it’s no use buying a bicycle that won’t fit your leg measurement.
Generally, that extends to almost anything where people want to try before they buy. You can get away with certain things, (like certain niches of clothing) but unless there are already stores that make money in the niche, there’s probably a reason why you’re not going to be the successful first person.
Let’s talk about that.
2. There Are Other Long Running Dropshippers
“You want to find a niche with low competition!”
That thought leads a lot of people to pick stupid niches where there’s a good reason people don’t buy online.
(“Hey man… I’m thinking of selling drugs paraphernalia online. There’s hardly any competition!”)
There are lots of different ways to test niche feasibility.
Here’s an initial one: Check to see if there are businesses like yours. Businesses which have existed for a few years. Businesses that don’t require venture funding.
This will cross out a lot of bad niches for e-commerce.
Every time there’s a new fad there are a billion wantrepreneurs who’ll start an e-commerce store. See watches from AliBaba and Cubic Zirconia jewellery. Usually $249.99 but yours for the price of $5.
You want to ignore these because most will disappear in a few months.
But if there are companies which are a few years old, then they’re probably profitable. Nobody operates ecommerce stores at a loss for years at a time.
The second part of this check: Are the successful companies massive?
For instance, you could try and dropship unbranded Chinese Android phones. Good luck competing in that market though. PPC is through the roof, regulation will bite you and most companies that sell phones are big companies or subsidiaries of big companies. Margins are based on companies buying hardware in the thousands of units.
Now, if your major passion in life is to start a phone company, then go ahead. If not though, it’s a headache and a battle you probably can’t win. There are winnable battles out there. Let the idiots fight the big dogs.
3. Google Image Search Returns Alibaba Images / All Images Are The Same / The Images Are Terrible Chinese Stock Photos
Most dropshippers would be better off if they did even the minimum amount of work possible.
Most dropshippers just upload a CSV file into Shopify and leave it at that. They copy wholesale the images, descriptions and spelling errors from the source company that supplies the items.
James said – quite rightly – that most consumers don’t do reverse image searches or anything. That’s true.
But you should still change the images, because you’ll get duplicate content penalties and none of these things are set up for user experience. (Why would they be? Wholesalers are B2B and not B2C.)
Also… a lot of these images are not very good. The (usually Chinese) manufacturers don’t spend money getting award winning photographers to do their stock photos. So they look cheap and nasty.
Test: Go to Alibaba and put in a search for a clothing item. Then go to a high street store in your country and put in a search for the same item. Look at the difference in images.
4. Plenty Of Cheap Shopify Stores With Thousands Of Products And Generic Site Templates
If you’re looking at whether a niche is competitive, search for some products on Google.
If you see a bunch of generic sites with thousands of products, “Powered by Shopify!” signs and the most generic of generic templates, then you’re good to go.
Again, this isn’t a moral judgement – it’s a competitive effectiveness judgement.
If people can rank with duplicate content, boring websites and generic everything, then it won’t take much to outrank them. (See the BONUS point below.)
There’s nothing wrong with Shopify, but the high affiliate fees mean it gets bounced around on every entrepreneur forum from here to Mars. As such, most newbies use Shopify and thus if the results are dominated by Shopify, the niche is probably run by newbies.
5. Generic Product Descriptions Straight From The Manufacturer Specs
This is most grievous issue of all.
Guys, if you’re starting a dropship store, at least change the product descriptions.
Nobody reads:
“iPhone case. 5 inches. Diamond pattern with pug. Fits iPones 1-6 easily. Comes in black plastic bag.”
And thinks… “Gee, I’m going to buy that right away!”
By the way, I meant to include the spelling error above, because some guys don’t even check for spelling mistakes.
Look, you don’t have to write a long form sales letter for every product you sell, but if you copy the same manufacturer specs into your description, you’ll have:
- Text that’ll put people off
- No unique content for SEO purposes
- No copy to convince anyone to buy anything
Most product descriptions can be 400 words or less. Don’t be lazy. You’ll be outcompeted.
6. Bonus: No Blog, Social Media Profiles Or Anything Remotely Useful
There’s a reason that people in business talk about “trust signals.”
When you have a generic website with crappy photos and no signals that say, “Hey… this is an actual store!” then you’re in trouble.
Why?
Above all, people will look at it and say, “that site looks fake!”
If you don’t have info about your shipping, it’s game over. Same for returns: Game over.
If you don’t have an address, then it’s game over.
More and more though, people look for more. Do you have a Twitter account? What about Instagram? Or a blog with a few entries ab out your business.
This isn’t about SEO or content marketing. It’s about looking and acting like an actual store that people will buy from.
If you can’t achieve that very basic goal, then you won’t make sales.
Final Thoughts
This concludes an article about “How to not make your e-commerce site totally and utterly terrible.”
Obviously there’s more, much more, that goes into having a successful e-commerce store. But seeing as there are thousands of people who can’t do the above it’s worth starting at the beginning.
No doubt I’ll write more about what to do in the future as opposed to what not to do. But in the meantime, add to the list by leaving your comments below.