If you’ve decided to give dropshipping a try, you need to choose the type of store you want to establish and what niche to target.
Before starting your dropshipping business, you need to decide on the type of online store you want to open. Although there are many variations of dropshipping stores, most of them tend to fall into the categories of general stores, single-product stores, and branded niche stores.
What is a general dropshipping store?
Think of your average department store that sells a wide range of products. General dropshipping stores operate similarly, hosting a wide variety of products that are not connected to one another. If you choose to source items from different categories, such as clothing, gardening tools, skincare, and electronics, and add all of them to your store simultaneously, you have a general store.
General dropshipping store pros and cons
Pros
- Attract a broader audience with multiple items of interest
- Have a broader testing ground for new products and services
- Reduce dependency on single niche items
Cons
- Multiple products together can seem random, difficult to navigate, and reduce trust
- No niche or specialization can make a store hard to find on search engines
- Lack of specialization can make brand building more difficult
What is a one product dropshipping store?
A one product shop is more or less the opposite of a general dropshipping store in that the entire store is focused on selling a single item. One product stores tend to have a higher success rate than general stores, as dropshippers will look for trending products that are in high demand. Success can be short-lived if the trend doesn’t last, but with a good marketing campaign and quality sourcing, single product dropshipping stores can provide fast revenue and brand recognition.
One product dropshipping store pros and cons
Pros
- Easy to set up and begin selling with low initial investment costs
- Simple catalog allows for more effective and targeted marketing
- Single, popular items sell fast and easily, allowing for short-term spikes in revenue
Cons
- Changes in trends can lead to sudden lack of demand for single items
- More reliant on good marketing and quality control for effective brand-building
- Greater risk of early failure if dropshipper fails to capture target audience
Moreover, this model is often chosen because it allows targeting specific consumers with ease. Also, marketing efforts are significantly more organized due to the narrow focus, and conversion rates tend to be quite satisfactory. Nonetheless, one product stores have a greater risk of failure, so you must be willing to invest time, effort, and money into making this model work for you.
What is a Branded Niche Dropshipping Store?
Many dropshipping stores fit into the category of ‘branded niche.’ This type of store sells products in a specific category, like women’s apparel, organic skincare, hiking gear, gym apparel, or aromatherapy. Unlike one product shops, there is no need to continually search for viral products because you already have a specific niche catalog. You appeal to a broader audience like a general dropshipping store, but avoid clutter and reduced branding opportunities. Branded niche dropshipping gives you the best of both worlds.
Branded niche dropshipping store pros and cons
Pros
- Easy brand recognition building, demographic targeting, and sales sustainability
- Simple catalog allows for more effective and targeted marketing
- Single, popular items sell fast and easily, allowing for short-term spikes in revenue
Cons
- Changes in trends can lead to sudden lack of demand for single items
- More reliant on good marketing and quality control for effective brand-building
- Greater risk of early failure if dropshipper fails to capture target audience
A large percentage of dropshippers prefer this type of store because it allows good branding opportunities, facilitates specific audience targeting, and removes the ‘lightning-in-a-bottle’ limitations that come with single product stores.
Niche stores are why many customers prefer buying from dropshippers instead of wholesalers in the first place. Instead of browsing through thousands of products on sites like AliExpress, they can choose from a narrower product range that directly addresses their specific needs. Opening this type of store allows you to create a branded element and experience.
It’s up to you to assess which model fits your vision and budget best. Consider doing research on all three categories and choosing what works for you.
Choosing Your Dropshipping Niche
When choosing a niche, a good way to start is by considering your own interests. Are you passionate about sports? Photography? Style? Hair and skincare? Being passionate about what you are sourcing and selling can increase your chances of success.
The next step is carrying out market research to understand whether your chosen niche is in demand. You can use Google Trends to help you understand if people are searching for the products you want to sell. Enter keywords related to your niche and see if people are searching for them. You will also be able to determine whether your niche is trending, steady, or in decline.
To avoid looking like a general store, try to segment your niche. If you’re selling clothing, classify it as women’s or men’s. Go a step further, and organize them into undergarments, business attire, or streetwear, for example. A segmented niche will have a positive impact on your future marketing efforts.
Steady vs. Trending Niches
Dropshippers often have to decide if they want to start selling trending products or opt for a more steady business model. Selling trending products can reward you with short-term success and make marketing easier (since the products are already popular), but there is no guarantee that a trending niche will remain at the top of the charts.
Let’s consider the demand for medical masks in 2020. Although medical masks were trending, people eventually stocked up on masks, decided to purchase reusable ones, or stopped taking the pandemic seriously. You could have sold masks with success until April 2022, but the item dropped in popularity after that. Still, the profits earned during that period could have been pretty significant, leading to further business ventures, so it’s not always a bad idea to aim for a trending niche.
For steady niches, let’s look at the market for essential oils as an alternative healing and relaxation method. People will always remain interested in natural medicine, but popularity can fluctuate depending on local and global events. People did purchase more essential oils at the beginning of the year (during the first wave of COVID-19), and the trend grew again during the second wave. No major fluctuations were recorded, meaning this niche could be defined as steady. You may face stronger competition and may not generate huge profits initially, but achieving long-term success and financial stability is easier with steady niches.
Both options are viable, but there also exists a third, more balanced approach. Imagine opening a dropshipping store centered around skincare, which is considered steady. If you want to take advantage of trends, first, add essential products to your storefront. Then check if there are any trending products in your chosen niche. Add a couple trending products to your overall catalog, and see how they perform. This is a great way to have a steady product line while still taking advantage of eCommerce trends.
Now that you know about the different types of dropshipping stores and how to choose your dropshipping niche, it’s time to choose a supplier.