Is Dropshipping changing in 2019?

Has Dropshipping changed in 2019? Do you think it is worth Dropshipping anymore?  Will it actually work? The answer is yes. What are the Dropshipping strategies to be followed in 2019 to make your business sustainable? Well, I have already mentioned in the Doer Group that my focus will be on long term sustainability and a lot of content will drill down to creating a business that will fetch the drop-shippers a consistent income. In order to succeed long term there are certain things that need to be done right which will have a positive impact on your business, profitability and wealth. Check out this video on Dropshipping is changing to find out what changes are happening and what needs to be done right.

Dropshipping changes and its business impact

Let me assure you first that Dropshipping is not dead. It is a business model existing for decades and will continue to exist for decades. As Dropshipping gets more and more popular, it has become all the more competitive. As the number of players increase in the market place, companies like Shopify, PayPal, Facebook, are more inclined to provide customized services with better pricing to cater to the Drop-shippers’ needs. But there are certain risk factors associated such as shipping speed, scamming, and product quality which force the companies to put your account on review or hold. For example; Shopify puts a 25% hold on Shopify payments.

Facebook and Dropshipping

While Facebook understands that Dropshipping is a legitimate business it emphasizes in protecting the interests of the clients and Drop-shippers.

Customer Feedback Score – new feature

Facebook has started a new feature, “Customer Feedback“. In order to see your customer feedback for your page, what Facebook does is it assigns a customer feedback score to a particular page. Facebook primarily does this for Ecommerce related websites and pages. Since data is tracked using the Pixel, Facebook knows which client has actually made a purchase on your store because your purchasers hit a purchase pixel.

Facebook shows a survey, puts up notification, which comes in your client’s feed wherein they can share their feedback. Lots of them do take up the survey and share their feedback on the kind of service they got from your purchase store.

How does Facebook request the customer feedback rating?

Facebook requests the customer feedback rating based on the following Parameters:

1. Product Quality
2. Shipping Speed
3. Customer Service

How to read your feedback scores?

Total Feedback Score

Interpreting your feedback score range

0 to 1: If the feedback scores fall in this range advertising will be curtailed

1 to 2: If the customer feedback score for a page lies between 1- 2, your CPMs will be higher and you end up paying more to acquire even few customers.

2 to 3: Basically what this means is that you will not face a delivery penalty but if your feedback rating keeps going down, even if your score is not between 1 – 2 but between 2-3  on the lower spectrum of 2.1, 2.2, your CPMs start to grow up. If your score goes up to 2.8, 2.9 or 3 your CPMs start to go down.

Most of the ecommerce entrepreneurs in the beginning to mid stages are likely to fall in this range because of shipping quality, product quality not being known. If your feedback score goes below 2 based on the delivery, or product quality or customer serviceh, you might turn unprofitable

Your goal should be 3 or higher.

4 to 5 means that you are fantastic.

How to ensure that your customer feedback remains high?

Ensure that your product quality is high. You can import the products home, check the product quality yourself, and try it out. If you feel that the product quality is not good or you can stop scaling but for the products that do work, you can go ahead leveraging the ads.

Before scaling a product ship the product to your home, check it out yourself and if it is not that good, don’t scale it. Move on to the next product. Because keeping these things in mind, if the product performs as specified the customer feedback score will remain good and your business will remain longstanding consistently.

How does a customer feedback page look like?

Recommendation: Keep improving each of these metrics to improve the overall score

Product quality

Basically during testing your products, you might not know your product quality. Hence, you can check the seller ratings or vendor ratings on Ali Express platform or other platforms and look out for star ratings in the range of 4.8, 4.9 etc. Any rating below 4.6 or 4.5 is not acceptable because there might be an issue with shipping speed, product quality.

Shipping Speed

This is where a lot of people get stuck.

Dealing with Ali Express: Some vendors ship quickly and some vendors do not. In the testing phase, during the first few weeks of testing the customer feedback score won’t impact you so much because you are trying out products and the number of orders will be low.  You have to find a provider that can ship the products soon to your customers.

There are two ways of doing that:

1. Purchase in bulk from Alibaba suppliers who are manufacturing the products and get them shipped to a US warehouse such as ShipBob or Dollar Fulfillment.

2. Google out for a Dropshipping agent. Alternatively take the service of individual Dropshipping Chinese agents who keep a small amount of inventory with them with a shorter processing time. Hence they will be able to ship soon to you customer through e-packets and other shipping methods.

To find these individual agents, search for Dropshipping agent groups on Facebook. You can search inside the groups using the keywords such as agent, source or fulfilment, contact them and check their review pages. They might not be much interested in smaller supply volumes and look out for a higher volume. However, when you reach a higher volume you might want to move to the US warehouse and not china.

Customer service

The third parameter is Customer service which falls on the following 3 metrics:

1. emails
2. Facebook messages
3. Facebook comments

You need to ensure regular checking and replying to your Facebook comments, and messages. Create a priority to reply your purchasers and ensure a proper tracking mechanism to find out if they are satisfied with the product or need a refund.

Ensure that you are on top of the communication and do not lag behind because they have will have an impact on the customer feedback score.

Your customer feedback score is a combination of all the three parameters mentioned above. Sometimes the shipping speed might not be that good but your customer service might be good. If all the 3 are bad, for instance your shipping speed, customer service and product quality then your customer feedback score might go down between 0 and 1 which is a dangerous position.

Try to have a minimum score of 2.5 – 3, 3 and above is great.

Why are the changes good for genuine ecommerce entrepreneurs?

These are the changes happening in 2019 and it is good for genuine drop-shippers who are focused in finding a winner product, scale it up, set up a team, who do proper customer service, ship the products on time from US. When the business model is set up properly, the customer feedback page is sure to be good and profitable. It is bad for scammers because they will get caught quickly and be out of business.