Dropshipping is dying: How can starting a mobile app save your business?

Dropshipping is a unique system that enables you to sell products to people around the world without worrying about factors like inventory and delivery.

Starting an ecommerce store is not a feasible prospect for a lone entrepreneur. The cost of inventory and delivery takes away any real margin you can gain from selling products.

You can only realistically make money if you scale the size of your business. Most entrepreneurs at the beginning of their journey lack the resources to scale their business.

Dropshipping helps you cut through these problems. All you need is a supplier who can package and deliver products on your behalf. All you need to do is to market the products and get orders from customers.

On paper, dropshipping is the perfect solution for entrepreneurs to run ecommerce businesses. There is even an added advantage that you don’t need to worry about maintaining inventory and managing deliveries.

So what is going wrong?

What is happening in the world of dropshipping?

On the surface, dropshipping is still a viable option for you to start an ecommerce business. However, there are various factors working against dropshipping success.

#1 - Losing control over the fundamentals

There are three main factors that guarantee long-term success in ecommerce - low costs, fast delivery, and product variety.

Dropshippers lose out on all these three factors.

They have to mark up their products to create a margin for themselves.

Guaranteeing fast delivery is out of the question as this is the responsibility of the supplier.

It is possible to have decent product variety, but dropshippers will always fall short of large online retailers.

As a business model, dropshipping can work in the short-term. You can accumate a decent amount of capital with dropshipping within a year or two.

However, it is fundamentally flawed to work in the long-term. Customers will eventually choose platforms that provide products at better prices.

#2 - Changes in privacy policy

The new changes to Apple’s privacy policy has been doing the rounds for weeks now. iOS apps now need to ask users for permission to collect and track their data.

All indications suggest that a large percentage of users will decline apps to track their data. Apps like Facebook serve personalized ads to their users by collecting their data and evaluating their preferences.

These changes are expected to hit Facebook ads hard.

Most dropshippers rely on running Facebook ads to make sales. The changes brought on by the iOS 14 update will hurt dropshippers as they try to serve personalized ads through Facebook.

Apple will not be the last company to make changes to its privacy policy. Dropshippers thus face a major marketing challenge.

#3 - Declining knowledge gap

Five years ago, dropshipping was still in its infancy as an idea. Therefore, anyone new getting into the field didn’t have to face too much competition.

The scenario has completely shifted now. Almost everyone in the online marketing space has a working knowledge of dropshipping.

This has led to many entrepreneurs and companies starting their own dropshipping stores. This has created a lot of competition in the space.

The first mover’s advantage is gone now. It may not be the best idea to start a dropshipping business right now.

How does a mobile app help?

So dropshipping is facing some serious challenges. How can starting a mobile app help?

Firstly, it is no longer difficult to build an app. You can easily use a reliable app maker like AppMySite to design and create a mobile app from scratch. The best part is that you don’t need to write a single line of code.

There are many ways starting a mobile app can help your dropshipping business. The following points cover these benefits in detail.

#1 - Getting more orders from existing customers

The main challenge in dropshipping is going to be marketing. Social media marketing could lose its efficacy soon as companies start prioritizing user privacy over ads.

Starting a mobile app effectively gives you a brand new medium to promote your products on. You can also get multiple orders from the same customer and thus reduce the need to acquire new users.

Customer retention is going to be crucial for dropshippers as marketing challenges become steeper. Apps can help in this regard.

A customer who downloads your app will likely order more products than someone visiting your online store. This is because the latter probably found you from a Facebook ad.

Your app customers can browse through your products instantly, thus increasing your chances of making a sale.

#2 - Branding

The long-term goal of any dropshipper should be to create a brand. This is difficult to achieve if all your traffic comes from paid Facebook ads.

An app helps in this regard. It helps you create a permanent space in the attention span of your customers. A website cannot achieve the same result because customers must first search the URL on their browser.

WIth an app, you can immediately draw the attention of your customer. You can thus close a greater number of sales while becoming part of your customer’s ecosystem.

#3 - Standing out amongst competing dropshippers

Most dropshippers do not have a mobile app. You can thus immediately stand apart from the crowd by launching an app.

There are many options you can choose to make your own app. AppMySite is a great app builder software that enables you to make your own apps without coding.

With increase in competition in the dropshipping space, you naturally need to differentiate yourself. Launching an app is a great way to elevate yourself from the competition and provide customers a direct platform to work with.

In conclusion

Dropshipping is still a great way to set up an online business. However, you must also learn how to create an app for your dropshipping website. This will help you overcome the disadvantages of indirect selling.

This piece offers insights into the changing world of dropshipping. You should carefully consider your options before jumping into the ecommerce arena. Dropshipping has changed from what it was five years ago. You must be prepared to deal with the unique challenges dropshippers currently face.