Earn More Money, InvestingMay 18, 2019June 23, 2019

How Profitable Is Drop Shipping In 2019?

Yes, another drop shipping blog. However, we won’t be going over the pros and cons of drops shipping. Rather, we will be taking a look at the industry and if it is still a great opportunity in 2019! I will be outlining three niches that I believe to be highly profitable for a number of reasons. Lastly, insight on how you can make your drop shipping business successful will be discussed! So, without further ado, let’s get started!

1. Is Drop Shipping Dead?

Since drop shipping has become so prevalent, you’ll often hear people say that it’s become a dead opportunity. The market has become oversaturated and that you should move onto the next best thing, whatever it may be. However, you must look at things from an unbiased standpoint. Like any industry, there are many people competing within it for your business. Some have cheaper products with lower quality and vice versa. However, what makes you successful in any business is consistency and willingness to evolve. Although, can the same be said for drop shipping?

In order to know if it’s dying, we have to look at some facts. Drop shipping is easily accessible which means many people are doing it. This means that there are more people actively creating drop shipping stores every single day. However, you can beat the oversaturation with time and effort, just like any other business. You get what you put in so to speak.

With all the competition you can imagine that profits are a lot lower than what they used to be. However, there are many avenues you can take to counteract this. We are not going to go into the pros and cons because we’ve already done that. However, what we’ll go over are some lucrative niches, what your odds of success are and some ways you can improve your website traffic.

2. Lucrative Niches

Here we will look at some profitable niches within the drop shipping sphere! Similar to how Youtubers pick categories to create content on, drop shippers pick categories as well! As you can imagine, some are more profitable than others and there are many contributing factors that make this true. The factors can depend on the average price of the product to demand. In non-chronological order, here are some lucrative niches.

Gaming

One very popular niche that has increased over-time is home gaming stations. If you’re wondering how this can be profitable a quick google search will tell you that a lot of time, money and effort is put into making one of these stations. People will spend hundreds to thousands of dollars just to have a powerful computer. With gaming becoming more popular through platforms like Twitch.tv and Youtube, computers are being built every single day.

Since these platforms have emerged, it has become apparent that gaming can be lucrative as well. Considering some of the most famous YouTubers are gamers, it’s not such a bad investment. Here is a graph showing the current and projected growth of PC gaming hardware, along with a very detailed PDF by Clarfield.com:

Now, you may be wondering what kind of items you may be able to sell on your drop shipping store when it comes to gaming. You’re in luck because there is quite a wide array of items. Every computer needs a monitor, which can come in various sizes and resolutions. Furthermore, you can sell fans, graphics cards, processors, mouses, mouse pads, keyboards, repair parts, cases and so much more.

Honestly, if I were to list all the items that you can sell, this article will be 4000 words in length. So, to spare you some time I’ve listed a few with graphics card probably being one of the most in-demand and lucrative items. Therefore, if you’re looking for a particular niche, this one isn’t such a bad idea.

Fitness

Every day there are people googling what the best diet is. After they get an answer that satisfies them, the search for supplements and home workout equipment starts, this is where you come in. Everywhere you turn there is someone who wants to become healthy or someone who genuinely needs help to turn their life around. However, many people can’t afford a gym membership or simply do not have the time to go to the gym every day. Therefore, on top of selling supplements that can assist the user who is actively going to the gym, home workout equipment can be sold to those who can’t go to the gym!

There are many supplements that can be sold such as BCAA, protein powders, etc. Furthermore, home workout equipment ranges from dumbells to elastic workout bands. Just like gaming, there is an ocean of variety at your disposal when drop shipping workout equipment/supplements. The great thing is that the fitness & supplement industry is booming. Here, take a look for yourself!

The graph above portrays the growth of the dietary supplement market so far and what it’s projected to be within the next 5 years. As you can see, there is a very clear up trend which means that now is a good time as ever. The graph below depicts the growing market for fitness clubs. Even though you’re not running a club, the increased volume of customers means that there will be more of a demand for workout supplements. Jumping in on an opportunity is something that many people miss out on for various reasons. However, there is clearly a positive trend in this industry so with some more due diligence, this might be your niche.

Photography

Photography is another huge player in the drop shipping community. If you notice, the common denominator among the three mentioned lucrative niches is that they are all in a market that is growing. However, one of the most important aspects of choosing a profitable niche is that there needs to be growth in the future. Photography is one of these growing industries. Aided, once again, by social media platforms, photography equipment tends to be expensive. Some common items that can be sold are cameras, lighting equipment and probably the most sought after items, light bulbs.

Stellar lighting is ESSENTIAL for quality pictures and videos. Furthermore, it’s no wonder why people will dump hundreds to even thousands of dollar into photography equipment. Photography can be looked at as an investment, much like the two previously mentioned niches. However, many people can see these niches as just a hobby, which is why I think that these categories can be very lucrative.

Not only are all of them in a growing market but each one can be seen as either a hobby or an investment. Both of which people are willing to spend money on. Lastly, here is a graph from BusinessWire that details how much the photography equipment business has grown:

3. What Are Your Odds At Being Successful?

Like any business, the success rate depends on your work ethic with a sprinkle of luck. The current success rate of drop shipping stores is below 30%. This can be attributed to the increased competition and multiple disadvantages that come along with the business. However, not all hope is lost! Entrepreneurs, in general, have a low success rate which means you’re going to need to do a few things in order to give yourself an advantage. Information is king and if you how to apply the information you’ve learned, being apart of that 30% is completely possible.

Market Research

Market research is huge, and it coincides with all the other factors that’ll make you successful. In gaming, for example, you are going to need to know the various types of companies, retail prices, and shipping dates (among other things). Furthermore, you will need to study other drop shipping websites to see what kind of items they offer and at what price.

Aside from the items, knowing the type of demographic you’re aiming for is huge. This means that when you’re marketing, you can decide who it’s tailored towards. The demographic for gaming has widened over the years. Therefore, for a niche like gaming, aim for ages starting at 13 years old. Gaming is a male-dominated area. Although, there is a consistent uptrend of female gamers appearing within the community. This is just a very surface level of analysis of the gaming market. If you want to turn your store into a form of passive income, you’re going to need to do much more.

Marketing/Advertisement

It’s true that starting your drop shipping business can be cheap but making it successful is a different story entirely. Once you’ve done the necessary market research, you will need to curate advertisements that are compelling and drive traffic to your website. Your best friend will be social media and Facebook ads.

For a platform like Instagram, the main focus should be creating pictures of the item you’re selling. Follow this with a series of hashtags that correspond towards your item and the market you’re trying to target. Do not underestimate interacting with your audience and fellow drop shippers. Following accounts that are appealing and leaving comments can get you further than expected.

Facebook ads are probably the main marketing tool for many. However, these ads are not so black and white. Not will you have to have a compelling picture, your copy needs to be short, concise and includes a call to action. The Facebook algorithm is constantly changing which means your ads can be doing will one day and underperform the next. This promotes the notion that you’ll need to constantly curate and adjust your ads to meet requirements.

Lastly, targeting a specific audience is vital. If you’ve done your market research, you’ll know the type of people to target. Age and gender play a huge role. However, you need to set your ads to target those who have particular interests. This is called detailed targeting. Here is a little snippet of what it looks like:

4. What Does This All Mean?

What this all means is that, although drop shipping has become saturated to a certain degree, there’s still an opportunity. Like most things in life, nothing is guaranteed. However, you can give yourself an edge over others by doing your research, picking a profitable niche, marketing like a pro and persevering. There are many profitable markets that are booming and if you can offer something that other people can’t, you can be successful.

Shameed Chris Khan

Shameed is just a man on a mission to help those around him gain financial success. Obsessed with writing about all things finance, this GTA native is constantly learning and sharing his experiences with others.