So, the other morning I woke up to a $432.25 sale through a single order. Was this an anomaly? Nope, I see weekly orders at this amount on the regular with this particular Shopify dropshipping store.
For those of whom don’t know, I run multiple dropshipping store and this particular store is set up in a way so it’s completely automated in the long run – minus order fulfilment of course, which I manage myself as there’s only a few orders per week.
But I don’t mind the fact that this store only sees a few orders, as the average order value is $300-400 and the profit margins are high.
One of the quips that I had and many others have with dropshipping is the low profit margins and the sheer volume of products you need to sell to create a sustainable income. Many are often obsessed with selling knick-knacks for $10-20, scrapping in a profit of $1-2 per order give or take pending the cost of advertising. Now this isn’t viable at all and although I preach the fact that you’re able to sell whatever you want successfully as long as you know how to market and have business acumen, you should also be smart with your product choices.
With this specific store, the focus was initially to create a huge successful store, but I quickly pivoted. I wasn’t seeing the success I first envisioned and I didn’t have the time to manage two dropshipping stores amongst other things anyway, so the focus changed to “how can I set up a store so it’s profitable but I don’t need to spend any time or money.”
High Ticket Dropshipping & Bundle Marketing
So we enter into the high ticket arena, it’s a no brainer and affords you more flexibility – from a larger bufferzone to allocate to ad spend to a smaller pool of customers to manage in terms of customer service.
Here’s the two aspects I’ve set up that you should consider if you’re starting out or looking to transition to high ticket dropshipping.
High Ticket Dropshipping is Vital
First and foremost, yes there are more risks involved with high ticket items, but with more risks come more reward. The larger or more expensive the item, there’s more of a repercussion when it comes to losing the item in transit, damage to the item, higher shipping costs etc. BUT, the right profit margins offset a lot of these problems.
On top of this, the cost per acquisition budget increases dramatically, so there’s more room to play with budget. For example:
- AliExpress bracelet that sells for $5
- Selling price: $15
- Advertising buffer: $10
- Profit margin estimate: $2-5
- Cost per acquisition = $5 max
- AliExpress/Amazon Electric Skateboard that sells for $300
- Selling price: $1,000
- Advertising buffer: $700
- Profit margin estimate: $300-500
- Cost per acquisition = $500 max
You should get an idea from the above the flexibility of high ticket dropshipping if you’re doing it right. As with the video above, I’m making a solid $200-300 profit per order on average per order and although it’s not huge amounts of money, that’s all my groceries and gas/petrol paid for the week. Now, that’s HUGE!
To achieve the above, I also deploy…
Bundle Marketing – The Art of The Cross & Upsells
But how do I consistently manage a steady stream of high-value orders (beyond branding and SEO)?
The art of the cross and upsell.
I’ve simply installed a powerful Shopify app called Boost Sales. It’s a one-click solution to setting up a seamless experience for customers urging them to increase their order value with you. Specifically, I’ve set up buy one get the next product at X% discount with this app and it has worked wonders. Even with the price point at hundreds of dollars.
By setting up automated cross sell and upsell flows, it ultimately gives the store the ability to boost overall sales value and the opportunity to further “automate” the store in the sense that you’ll require less orders to establish a strong passive income stream.
Boost Sales – The App
The app does the trick.
You can set up a whole-range of one-click options such as targeted upsells. When visitors add an item to cart, a popup will appear to upsell them a list of better options that they might be interested in.
If enabled by you, Boost Sales will use AI to automatically pick up the most appropriate products to recommend based on customer’s shopping behavior, and increase sales for you.
Cross-sell helps you to bundle up products that go well together into an irresistible combo for your customers.
When customers view any product in the bundle, a corner popup will appear with special effect to catch their attention and suggest the whole pack.
You can also offer discount coupons to promote your valued deals even better, and significantly boost sales from any existing customer. You can also flick on the nifty AI feature with cross sells too.
And of course, the all important check out page!
Do you know that upsell at cart page is reported to reach 5-10% conversion on average? When customers click “Check Out” button in cart page, one last upsell offer will show up to suggest them more items they might want to add before checking out.
These products are well-chosen based on their shopping behaviors and your sales history, which makes customers more likely to purchase.
So there we have it, go forth and find your high-ticket items, set up bundling offers and with the help of paid traffic, see the profit margins rocket up!
► Recommended Offer Bundling / Upsell / Cross-Sell App: http://bit.ly/getboostsales
If you’re looking to start dropshipping and establishing a passive income stream today, be sure to check out the free Dropshipping Bible for Beginners eBook here and the complete complementary video tutorial series here, also completely free.
If you’re looking for more free content, be sure to check out the free resources section of my website to help you on your way to dropshipping like a pro and for those looking for a mentor or simply to take their digital marketing, entrepreneur and dropshipping game to the next level, I provide mentorship to select students – you can organise your own call with me here.