Dropshipping Success Stories: How Two Entrepreneurs Built Successful Businesses
We recently spoke to two successful dropshipping entrepreneurs. One who started up in the last couple of years, and one who’s been at it for more than a decade.
Their businesses are very different. One sells crickets to lizard owners, the other sells custom promotional gifts to consumers and businesses — but they share three common traits.
- Dedication to building content for SEO
- Monitoring and upgrading suppliers
- Willingness to multitask and wear many hats
Jeff Neal: The Critter Depot
The Critter Depot sells live crickets to reptile owners, who feed them to their pets. Jeff Neal, the owner of the business, says he pulls in about $15,000 a month in sales.
Neal told us he’d been wanting to start an eCommerce business for years. He was looking for an underexploited niche but hadn’t found the right opportunity. He considered selling thermal scopes, meat thermometers, and women’s shoes. Then, he heard the call of crickets.
“The effort required to get first page organic rankings was pretty easy,” Neal says.
Easy, but not quick. Neal says it took about two years for his site to rise up the rankings.
During that time, The Critter Depot was just a side project. He found a supplier and fulfilled some orders, but he didn’t do much more. “I might go months without touching the site,” Neal remembers.
He wrote some articles for his site, but they weren’t that extensive and didn’t help his rankings much. What did help was when Neal started focusing on publicity and getting backlinks.
He began contacting reporters looking to write about unique personal finance stories. “I’m a millennial who sells crickets,” Neal says. “It’s pretty unique.”
Neal subscribes to a service called Help A Reporter Out. It’s a service for journalists who are looking to interview people for articles and blog posts. When Neal sees a request that relates to his experience, he responds and makes himself available for email or phone interviews.
Neal’s story has appeared on the websites of US News & World Report, USA Today, Reader’s Digest, and others. And critically, so do links to The Critter Depot. The link authority of those venerable sites is a quality signal to Google. Each story helps Neal’s site inch further up the rankings, and higher rankings lead to higher sales.
Now Neal puts in 20 to 30 hours of work per week on The Critter Depot. He wakes up at 4 a.m. to answer customer emails and make sure orders are on track. He has held onto his full-time job, so once that’s over, he comes home and spends another hour on the site in the evening.
“I’m really trying to branch it out and make it more informative,” Neal says. “The benefit of the internet is all information — that needs to be the focus of the website.”
Towards that end, Neal hired a zoologist to write in-depth care guides like this one: How to Care for Your Beloved Bearded Dragon.
Neal also says that his increased sales have helped him find better suppliers and better margins. Once he was delivering a consistent number of orders, the bigger commercial growers were willing to fulfill for him. He’s not only getting more orders; he’s profiting more on every one.
He’s bullish about the long-term prospects of the site because the pet industry itself is growing so much. Neal notes that big food brands are expanding into pet food and supplies.
“Maybe someday I can flip it for seven figures,” says Neal.
Michael Lerner: Promos On-Time
Rather than searching for a business idea the way Jeff Neal did, Michael Lerner started his business in an industry he already knew well — selling custom promotional items and personalized gifts.
“I had no idea about the web,” he says.
Lerner launched Promos On-Time in 2006. Back then, with eCommerce in its infancy, Michael didn’t have access to off-the-shelf software or software services like today’s eCommerce entrepreneurs do.
His startup costs included a few thousand dollars for customer relationship management software, and another $3,000 to $4,000 on a web developer. “Within a week we were getting orders,” Lerner says.
Lerner’s experience in the industry helped him establish relationships with suppliers. “I was able to get favorable pricing, rebates, and other incentives.”
Lerner says the company did $500,000 in revenue in the first year, with their only promotional expense being a small amount of search advertising.
As the eCommerce industry has grown, startup businesses have many more resources than Lerner did. Sales CRMs, web development, and dropshipping can be acquired at the click of a button. But with ease, comes more competition.
“The space is 50 times more crowded than when I got into it,” he says.
Lerner keeps up with the competition by keeping on top of his suppliers.
“Constant monitoring,” he calls it. Lerner says to keep a close eye on suppliers as they grow. “The ones who have grown are the ones you have to watch the most. Inevitably they don’t keep up with inventory or quality.”
He has also identified niches like National Volunteer Week, and Teacher Appreciation Week. “We try to cater to those because there’s not as much competition,” he says. That includes original content to help rank for these terms on Google.
On a typical day, Lerner says he’ll work on many different tasks — from adding products to the site, to editing copy for fresh content, posting to Facebook and Instagram, publishing product copy, analyzing metrics … “You’ve got to wear a lot of hats,” he says.
Lerner also devotes 30 minutes a day looking at other websites to get ideas for what he should be doing on his own.
Starting and Succeeding With Your Own eCommerce Business
As you plan and grow your eCommerce business, consider the key elements of Neal and Lerner’s success.
Neal offered some simple advice for anyone thinking about starting an eCommerce business: “Learn SEO.”
Why These Entrepreneurs Invest in Search Engine Optimization
Both Neal and Lerner devote considerable attention to identifying and selling products that consumers are searching for online. In Neal’s case, he didn’t even start his business until he found a term that he knew would rank in results. And even then, it took two years of effort to start ranking.
The simple benefit of ranking high in search engines is a consistent, motivated customer base that you don’t have to pay to reach. While offline businesses invest in expensive marketing efforts like trade shows and television advertising, you won’t need to, and you can keep prices lower than your competitors.
Search is one of the main reasons Neal is paying a zoologist to write original guides for the pet owners he markets to. It’s why Lerner targets unique gift-giving events like Volunteer Week rather than try to compete with massive competitors on search terms like “graduation gifts.”
Link building, keyword research, and technical SEO are three key elements of SEO that every prospective eCommerce entrepreneur should understand. (You should also know how your hosting service affects your Google rankings.)
Attracting and Monitoring Supplier Relationships
No dropshipping business can succeed without reliable suppliers who offer competitive wholesale prices. The dropshipping entrepreneur may face a “chicken and egg” problem like Jeff Neal’s. Until he achieved a high volume of orders, the best suppliers wouldn’t do business with him. You may have to accept low or even negative margins as you build your customer base.
Once you have that base, and you get the supplier you want, don’t think that your work is done. As Lerner points out, suppliers who are in demand may see their popularity as a chance to skimp on customer service and product quality. Slip-ups by a supplier can decimate the customer base you built so patiently.
Be Ready to Work!
Dropshipping entrepreneurs don’t have to create or package products, but the time they save ends up being devoted to administrative and marketing tasks.
Both Neal and Lerner have the work ethic and flexibility to dive into many different facets of owning a business. Lerner told us that some of his bigger competitors have more than 100 people responsible for the tasks he handles himself. Some of Lerner’s roles include:
- Site Merchandiser
- Web Content Editor
- Social Media Manager
- Data Analyst
- Industry Competition Consultant
Likewise, Neal is up before sunrise every morning to keep Critter Depot on track. He has a full-time job and piles 20 to 30 hours of eCommerce entrepreneurship on top of that.
The trade-off? Unlike the people filling these roles at eCommerce behemoths, entrepreneurs like Lerner and Neal can decide when and how to do these tasks. They have the freedom to experiment and innovate, and if they’re successful, enjoy a full ownership stake that would be far more valuable than their corporate perks.
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