Selling niche products are a strategic approach for entrepreneurs starting a dropshipping business. It offers a defined target market and higher customer loyalty which are two great ways to be successful.
One niche to consider dropshipping is skincare products. It was one of the most profitable ecommerce niches in 2018. Skincare products make a great candidate for dropshipping because they are often repurchased and have a short shelf life.
To maximize profits, use these 8 lessons for successfully dropshipping skincare.
Choose a Target Market
Skincare offers a broad range of products such as organic or anti-aging products. Before choosing a product range, look your ideal customer to thoroughly understand their wants and needs. Create buyer personas, research trends, and study the purchasing patterns of that ideal customer. Once you’ve fully developed your niche audience, choose a range of skincare products and craft a targeted marketing strategy. Need a starting point? Check out these top 9 skincare products.
Product Bundling and Cross-selling
Bundling products and cross-selling are great ways to increase sales by encouraging customers to purchase more items per transaction. Most people use multiple products as part of their skin care regimen. This gives you the opportunity to bundle products that can be used together, like an anti-aging bundle that includes a special serum, cleanser, and an anti-wrinkle cream. Cross-sell by recommending complementary products such as a moisturizer when a consumer purchases a cleanser.
Build Brand Awareness
With 82% of consumers seeking referrals from their peers before purchasing a product, word-of-mouth marketing is a very important tactic to include in your marketing strategy. Utilize this reliance on a peer’s recommendation by starting an organic conversation around your brand and products. Consider offering samples of certain products to various skincare influencers so they promote your product on social media. You can also offer a discount for anyone who leaves a review. Sparking positive conversation about your brand among customers will help you reach a new potential audience.
Sell in Sub-niches
Skincare is a broad niche with high competition from other dropshippers and big-name brands. Consider differentiating yourself by choosing a smaller sub-niche to operate in. A sub-niche has less competition and a potentially higher profit margin. Consider selling men’s organic skincare, all-natural skincare, or luxury skincare.
Build Meaningful Supplier Relationships
Most skincare products you source will be branded products from the manufacturer, distributor, or wholesaler. Due to the existing reputation and brand surrounding these products, you will need to build meaningful relationships with your suppliers. The supplier needs to trust that you will uphold the brand’s image before allowing you to sell their product. This requires you to develop relationships with suppliers and gain their trust. Prove that you can maintain brand standards and be a good ambassador.
Try Private Labeling
One option for retail dropshippers is to private label. Private labeling is when you purchase a product from a manufacturer and brand it as your own. The product’s formula will belong to the wholesaler or supplier, but the packaging will reflect your company’s information.
Branding and personalization is pivotal in the skincare industry. Private labeling is a great option for retailers because it offers more control over packaging and branding while eliminating the need to formulate your own product. It saves you time and money, while still allowing you to have a defined and customized brand. Check out one of these private labeling skincare companies: Nardo’s Natural, Cosmetic Solutions, or Pravada Private Label.
Know All Regulations and Restrictions
Certain countries and regions have differing or conflicting rules regarding the selling and marketing of skincare products. Depending on where you sell, you will need to stay up-to-date on all the various regulations of that region. Here are a few examples:
- European Union: The European Union, which is made up of 28 countries, has much more stringent requirements for the ingredients going into skincare products. While the United States only bans 11 chemicals, the EU bans 1,328 chemicals.
- Canada: Much like the EU, Canada has more stringent rules than the United States regarding ingredients. Canada also has stricter labeling requirements for increased disclosure on products.
- China: China requires imported skincare to be tested on animals in government labs before it can be approved for sale.
Focus on Customer Retention
Skincare products are frequently repurchased which means your customer has a high lifetime value. Customer retention should be a big focus in your marketing strategy. There are plenty of opportunities to strengthen a customer’s loyalty to your brand. Create an email newsletter to remind them to get more product, develop a customer loyalty program, and run social media giveaways. Engage with customers as much as possible to ensure they are loyal to your brand.
Dropshipping is a great business model for selling skincare products. To simplify your ecommerce business, consider automating your dropshipping communication to ensure fast and seamless fulfillment of new sales orders.