The NEW way of Dropshipping 2024

Summary

In this video, Marcus Slam, an e-commerce entrepreneur, introduces a new model of dropshipping that focuses on high-ticket items, contrasting the traditional low-ticket, China-based model. He emphasizes the importance of using U.S.-based suppliers for better profit margins and customer service. Marcus shares his experiences and provides actionable steps, including setting up an LLC, finding niches, sourcing suppliers, and utilizing Google ads for the 'reverse funnel strategy' to target customers with high purchase intent. He also promotes his free e-commerce Mastermind group, Peak Flow Academy, for further guidance.

Takeaways

• 🔄 Drop shipping has evolved, and traditional low-ticket China drop shipping models are becoming outdated.
• 🚀 Marcus Slam advocates for high-ticket drop shipping, which involves selling more expensive, U.S.-based products for higher profit margins.
• 📈 High-ticket drop shipping can significantly boost store revenue, as illustrated by Marcus's store earning $93,000 in a month.
• 🛑 Low-profit margins and reliance on shared Chinese suppliers are major reasons why many drop shippers fail.
• 🔗 The importance of finding reputable U.S.-based suppliers is emphasized for better logistics and customer satisfaction.
• 🚚 Sourcing from U.S. suppliers can lead to faster shipping times and a smoother delivery experience for customers.
• 💼 Establishing an LLC and obtaining necessary legal documents like a resale certificate and EIN is crucial for becoming an authorized dealer.
• 🔍 The 'rabbit hole strategy' is recommended for finding high-ticket niches with significant search demand and high price points.
• 📊 Using tools like Google Keyword Planner can help validate niches by assessing search volume and demand.
• 🎯 High-ticket drop shipping focuses on targeting customers with high purchase intent using Google ads, rather than social media ads.

Q & A

What is the main issue with traditional low ticket China Drop Shipping according to Marcus?

The main issue is that it's an unsustainable business model with low profit margins, leading to failure for most beginners. It also contributes to a bad reputation for the drop shipping industry due to poor customer service and product quality.

What is the difference between low ticket and high ticket Drop Shipping?

Low ticket Drop Shipping involves selling cheap products from China, often with low profit margins and poor customer service. High ticket Drop Shipping, on the other hand, involves selling expensive, high-quality products sourced from reputable suppliers, typically based in the United States, with higher profit margins.

Why does Marcus emphasize the importance of finding suppliers from the United States for high ticket Drop Shipping?

Suppliers from the United States are considered more reliable and offer better customer service. They also provide faster shipping times and a smoother delivery experience, which are crucial for high ticket items where customer satisfaction is key.

What is an 'authorized dealer program' in the context of high ticket Drop Shipping?

An authorized dealer program allows resellers to legally sell or distribute goods and merchandise of a certain brand. It's a business model where you apply to sell products from established brands, similar to Amazon private labeling or FBA.

How does Marcus suggest finding high ticket suppliers for Drop Shipping?

Marcus recommends using platforms like Wayfair to find high ticket items and then searching for the brand names on Google to locate the supplier's website. This method helps identify established brands with a demand for their products.

What is the 'reverse funnel strategy' mentioned by Marcus?

The reverse funnel strategy is a Google ad strategy that targets people who are at the middle and bottom of the buying funnel, meaning they have high purchase intent. This is different from traditional advertising methods that target people at the top of the funnel with lower purchase intent.

Why is it important to have an LLC and EIN when starting a high ticket Drop Shipping business?

Having an LLC (Limited Liability Company) and EIN (Employer Identification Number) is important for legal and tax purposes. It allows the business to be recognized legally and is often required by suppliers when applying to become an authorized dealer.

What are the criteria for selecting a niche when starting a high ticket Drop Shipping business?

The criteria include having a high search demand, a minimum product price point of $3,000, and the products should be non-seasonal to ensure consistent revenue throughout the year.

How does Marcus suggest approaching suppliers to become an authorized dealer?

Marcus suggests researching and listing potential suppliers, then reaching out to them via email or phone. He also mentions the use of a pitch deck, which is a presentation that represents your brand and business proposition to the supplier.

What is the significance of MAP (Minimum Advertised Price) policy in high ticket Drop Shipping?

The MAP policy sets a minimum price at which a product can be advertised, preventing price wars and ensuring that all dealers maintain a certain level of profit. It's important for maintaining the brand's image and the dealer's profitability.