Choosing A Drop Shipping Niche: Stay Focussed
Choosing the right niche for your drop shipping business is critical to its success. If you get this wrong, you business won’t fulfil its potential. The type of people you attract to your store is dependant on the types of products you sell. For example, if you decide to sell products for pets you are going to attract people with pets, not people that want to buy a surf board. So here is my guide to choosing a drop shipping niche.
Characteristics Of A Good Drop Shipping Niche
A niche is a group of people with a similar interest. There a billions of people with access to the internet, so you will be able to find a profitable niche with some research. The things you need to look for in a niche are:
- An audience that requires little interaction – This will help with your workload
- An audience that rarely returns products – Clothing is a good example of a niche where people send back stuff all the time
- High ticket prices – Ideally your audience should have no problem with paying for high priced products online
- Your niche should ideally be something you are interested in – This is because you are likely to have some knowledge about it already and you are not going to get bored working on your store
- Quality suppliers – Suppliers will have a star rating on most drop shipping plugins
- Focussed – A focussed niche is way better than a broad one, as your targeted customers have a bigger intent to buy and there will be less competition
- Popularity – Although a focussed niche is best, it still needs to be popular enough to have a big enough audience to sell lots of products to
- Be relevant – By this, I mean that it should not go out of fashion
- Work all year round – Seasonal niches will only earn you money at certain times of the year. A Christmas jumper store is the perfect example of what to avoid
Everything starts with choosing your products. You choose your niche, which determines the audience you are targeting.
Techniques For Finding A Good Niche
So how do you find out all this information? Don’t worry, there are a few techniques that you can use, to determine if your niche ideas are any good.
When you have found a product that you would like to put in to your drop shipping store, put it through Google Trends. This will help you see if its popularity is increasing or decreasing. It will also tell you how seasonal it is.
How It Works
- Type a category you are interested in in to the search bar, for example “drones”.
- Look at the results and analyse them by using the additional settings.
- The image above shows the results for drones over the past 12 months. You can see that the number of searches aren’t particularly high and they are fairly consistent all year. Searches do increase during the build up to Christmas though. To learn more about the dynamics of this search term we can change the region of interest, time frame, categories, type of content.
You will be able to see the seasonality of a niche. Like I mentioned before, these niches will only earn you money at certain times of year, so you may want an additional store or other forms of income if you decide to specialise in seasonal products.
Google Trends also lets you see the most popular related search terms and estimate how fast their popularity is likely to grow. This information is really important when planning your marketing and SEO strategies for promoting your drop shipping store.
Keyword Research For Drop Shipping
Keyword research is really important for a drop shipping store. This is because you won’t be able to optimise your product pages for search engines. By using quality keywords, (along with other SEO techniques) you will be able to get your product pages to the top of your audience’s web searches. This will generate more sales, potentially earning you money every day. There are a few ways you can build up a great list of keywords:
Google Keyword Planner
Google Keyword Planner is a free keyword research tool. It was created to help Google Adwords users find keywords with high search volumes and low competition. This was so they could plan their pay-per-click (PPC) ad campaigns. But this is also good for drop shippers, bloggers and affiliate marketers too.
You need some ideas of keywords that relate to your products. The keyword planner will be able to let you know how popular they are and similar keywords you can use. As you can see from the image above, “dog beds has 100,000 to 1,000,000 searches per month. Google keyword planner will show you keywords related to “dog beds” and tell you how often they are searched for too. These related keywords can be used in a LSI (latent semantic index) strategy. This isn’t as com[plicated as it sounds. By adding these other keywords in to product descriptions, you are helping google more about the product with will then push it up the rankings.
Jaaxy Keyword Research Tool
It is a really good idea to put your potential keywords through a keyword research tool. There are a few to choose from, but the one I use is Jaaxy. This is a really powerful tool that allows you to see the quality of a keyword. You can learn al about it in my guide to the Jaaxy research tool, but in summary it tells you how often a keyword is searched for, the predicted amount of traffic you would get if you managed to get on the first page of Google, how much competition it has and how good it is in terms of SEO.
jay also has the following functions and features:
- Alphabet soup – This helps you find lots of potential keywords
- Domain names – Jaaxy lets you know if the keyword is available as a domain name
- Search analysis – This allows you to analyse a similar post from a competitor, you can use the data as a benchmark for your post.
- Site rank – This is where you can enter the URL and the corresponding keyword in to the Site Rank tool. It allows you to find out where it ranks in search engines.
To learn more about finding potential keywords, check out my guide to finding the best keywords for search engines.
How Do I Know If A Keyword Is Any Good For Drop Shipping?
After you have put together a big list of potential keywords, you need to work out which ones are worth using. You need to narrow down you list to ones that fulfil the following criteria:
1. Search Volume
This is the first thing you need to look in to. If nobody is searching for your particular keyword, it doesn’t matter how easy it is to get it to the top of Google.
Keep in mind the seasonality of your potential niche, as you may not make any sales for the majority of the year.
2. Keyword/Product Fit
Just because a keyword has lots of searches, it doesn’t necessarily mean that it is a good one to use.
The keywords you choose need to be relevant and make sense for your product. If someone goes to your website after searching for a specific keyword and it isn’t quite what they are looking for, they will leave your website quickly. This will also impact on your rankings, as it says to Google that the search result isn’t relevant enough for the user. It is better to go for keywords that are more relevant to the product with less searches, rather than for ones that are not relevant with lots of searches.
3. Intent To Buy
Getting your products to the top of Google searches is fantastic, however, if all the people that visit your website have no intent to buy, you won’t make any sales. This is why you need to choose keywords that represent “intent to buy”. What I mean by this, is that your keywords need to target people that are ready to buy your products.
Keywords that have a high intent to buy will increase the likelihood of a customer buying from you. This is because people that search for these keywords are further along the decision process for their purchase.
Keywords with high intent tend to include words such as:
- Low cost
- Where to buy
For example ” buy wine fridge” has more intent to buy than “what kind of wine fridge should I buy?”. This is because the person searching using terms like “buy” are expressing an intent to buy and requires less research on their part.
You should also look in to long tail keywords, as these also suggest a stronger intent to buy. This is because the keyword is more specific and the searcher has more of an idea of what they want to buy. For example, “blue sofa” has less intent than ” 90 inch long three seat light blue sofa”. Long tail keywords have less searches, but they are more likely to convert in to sales, as there is less competition.
4. Competition and Difficulty To Rank
Your potential keyword may have great search volume, be very relevant to the product and have intent to buy, but if you can’t get it to the first page of Google, you are going to struggle making money from it. Most people don’t go past the first page of Google. This is where a keyword research tool such as Jaaxy comes in handy.
Jaaxy automatically show you how many other websites are using that keyword and how difficult it would be for it to rank. You can also use the search analysis function to drill down in to a few details to let you know what you need to do to beat the top ranking website. For example, it will tell you the word count, how many backlinks it has and if it is paying for Google Adsense. You can then make sure your product description and meta description is optimised and has a better URL that is more customer friendly.
According to AliExpress anything between 10,000 and 100,000 searches is perfect for a drop shipping niche. Any more than this, there will be far too much competition to make a success out of it. Less than 5,000 searches isn’t likely to have enough of a following to be worth working within the niche. Here is a guide to give you an idea:
- 5K-50K searches – perfect in terms of competition
- 50K-100K – the competition is great, but there still might be a place for you
- ≤ 5K searches – the niche has low competition, but there’s no profit in it
- ≥ 100K – the competition is too high, no chances to win.
I really recommend that you sign up to MOZ. This is a free tool that can give you all sorts of data about your website. But it also has a brilliant keyword explorer tool that will allow you to estimate the competition with real figures. You can get a great information regarding competition for a potential niche.
The image above show the results for “drones”. This gives you a difficulty rating for that keyword.
- 0-40 – Very easy
- 41-60 – Easy
- 61-80 – Moderate
- 81-100 – Difficult
More On Competitor Research
If people are making money in a certain niche, it doesn’t mean that everyone can. This is because it is much easier for established drop shippers to compete in extremely competitive niches than for a newbie.
Here I have outlined four steps that will help you get some necessary information about your potential competitors. I recommend that you create a spreadsheet with four columns to record all the information.
Google pour niche’s main keyword (e.g. drones for beginners)
Find all the websites that sell the product you intent to sell yourself that are listed in the first few pages of the search results. Put the URL of each website in the first column of your spreadsheet and the website’s name in the second column.
Check the “about us” page on each website to make sure that they are only an online business and don’t sell from an actual shop. If they only work online, put a “yes” in the next column or a “no” if they have a physical shop (or simply delete the whole row).
Make sure you have at least three competitors in the list. If you don’t, you should probably look in to a different niche.
Search through the remaining websites on your list and look for their “brands”, “manufacturers” or “suppliers”. This will show you the brands of the products your potential competitors stock. You will also be able to see which of these brands have drop shipping accounts.
While you are going through this process, you need to:
- Find the best sellers
- Look at their business models
- Look at how popular they are
- Look at directories to research the businesses that are selling the products you are interested in selling
- Look at how appealing their website is (so you can be more appealing)
- The colour choices
- How easy the website is to use
- Are they offering deals?
- Are they easy to contact?
- Look at what you like and don’t like about their website
Cheap Or Expensive Products?
One of the things that you need to decide on is, do you choose products that are cheap, but sell in high volume, or more expensive that sell in low volume?
Here is an example comparing a drone to an iPhone case.
What you need to understand from this example is that it is the same amount of work for selling either.
It is not easier to sell iPhone cases and there is a huge amount of online stores that are already established. Therefore, it will be really difficult to compete with them. Even if you do manage to sell low priced items such as iPhone cases, you will need to sell 400 of them to make the same amount of money selling 10 drones.
One of the most valuable things you can do while researching a niche, is to see how easy it would be to promote on social media.
For example, you can type in potential hashtags relating to your niche in to the Instagram search.
As you can see, a quick search for #dogs shows that there is a lot of potential, as dogs are very popular. You can also use online tools, such as https://hashtagify.me. This shows you the quality of the hashtag and how it is trending on both Instagram and Twitter with a whole lot of other data too.
This information lets you know what hashtags you would use when promoting your products. You should also look in to the most popular accounts that use the hashtags you are looking at. This is because you will be able to cooperate with them in order to promote your products.
When it comes to social media accounts that could possibly be used to help with promotions, you should be looking at accounts with over 30,000 followers. If you can fond more than 10 accounts with over 30,000 followers within the niche, it means that it has lots of promotional potential.
The accounts with a lot of followers are the best ones to work with. This is because you will get a good audience by using them. The easiest way of cooperating with an “influencer” is to get them to do shoutouts for your products.
Facebook is also a very powerful way of promoting your business. To check how much potential a niche has on Facebook, simply search for groups within your niche. You will see a list of groups that have that keyword and how many members are in them.
Again, you are looking for the amount of groups with over 30,000 members. If you can find 10 groups that meet this criteria, you are on to a good one.
Niches You May Want To Stay Away From
There are some niches that have some characteristics that you will probably want to avoid, or exercise some caution with.
Niches With Products With Lots of Details
Items such as electrical goods or clothing are usually subject to great scrutiny from customers. These are the things that people like to buy in a store, as they want to make sure it suits their needs. These products usually require a lot of customer service, returns and refunds.
Niches With Products That May Have Legal Issues
If your niche requires selling things such as knives, guns, bows and arrows etc, you may have difficulty with deliveries. This is because some postal services and customer may see them as questionable goods. Before choosing these products, you will need to learn bout the regulations in the countries you will be shipping to.
Niches With Delicate Products
Products made from materials that are easily broken or damaged will cause you lots of customer service headaches. Delivery times are usually extended, as they will not be packed in with other goods when shipping. Also, your customers will be pretty disappointed when their items arrive broken.
Niches With Large And Heavy Products
Large and heavy products will be very expensive to ship. This will cause your customers to just go to a regular store to buy. Additionally, these types of products can cause some unwanted shipping issues.