eCommerce Lifestyle
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How to Compete with Amazon When Dropshipping in 2020

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Yes, Amazon is the world's largest retailer. But what does it take to have a successful dropshipping business without being an Amazon seller?

We often get ahead of ourselves by thinking that we will never be able to sell as much as Amazon can. ​Well, I’m telling you that you SHOULD compete with Amazon. And you CAN with the right elements that I cover in today’s podcast.

What's Covered in This Episode:


​Nine ways to consider when having a dropshipping store:

  • ​Fast Shipping
  • ​Trust
  • ​Return Policy
  • ​Price
  • ​Product Knowledge
  • ​Customer Service
  • ​Special Offers
  • ​Content/Marketing
  • ​Relationships
If you liked today’s show, please subscribe on iTunes to The eCommerce Lifestyle Podcast! The podcast is also available on all major podcast players including, Stitcher and Spotify.

Links From This Episode:

This ​podcast is also available in video form. Click ‘Play’ below to start watching. Make sure to subscribe to our YouTube Channel for weekly updates and insights!

Transcript

What's up everybody. Anton Kraly here from eCommercelifestyle.com and welcome back to the podcast. In today's episode, we're going to be talking about how to compete with Amazon when you're dropshipping. Specifically, we're going to go over nine different things to consider if you decide to actually build a dropshipping store or even if you're already building one and running it.

I should also mention that when I'm talking about competing with Amazon here and dropshipping, I am not talking about building a multi hundred billion dollar business a year and I'm also not talking about doing some kind of small arbitrage play where you're trying to find products for cheap on eBay and sell them on Amazon or vice versa. I'm talking about if you actually want to build a real legitimate online store selling for brands that make quality products, and if you're in that situation and you're thinking, you know what, I think I want to do this, but how am I going to compete with Amazon? Because they are the, not just gorilla but the pack or tribe of gorillas in the room, right?

So again, we'll go through a few different points. I'll share my thoughts on them and let you know how you actually can compete with Amazon. By the way, if you're brand new here and you have no idea what I'm talking about when it comes to building an online store that sells for legitimate suppliers, definitely check out my free training. It's over at Dropshipwebinar.com. Go there. You can get a full training. Learn exactly how we build these businesses.

But let's start at the top of my list here and let's go through the reasons that consumers choose amazon by the masses, right? Including myself. I order a ton of stuff from Amazon all the time, but why do I do that? Why do you do it? Why does almost everybody now in the world do it? The biggest reason is fast shipping, right? You know, if you're a Prime member, that if you order something that's eligible for Prime, you're going to get it usually in two days. I think that's what it still is. Some locations one day now, but you're going to get it fast and people know that so they order from there. Also, people assume that they're always going to get the best price on Amazon. A big reason people assume that is because it is a marketplace, meaning that I could sell a product on Amazon, and Amazon can sell their own product on Amazon, and you could sell a similar product on Amazon. So it creates this competitive marketplace where prices can get driven down. So that's a big reason people go to Amazon as well.

Another one is trust, which based on my personal experience, I don't really tr... I'll talk about that in a second. But they think if I order from Amazon at least I'm not going to get ripped off. I'll get the thing in the mail. No one's going to steal my money. And that's true, but I'll tell you, typically what I order on Amazon is electronics and right now I'm recording this podcast. It's funny with a Lavalier mic it's called from a company called Rode. Great company, but I ordered, I forgot which microphone it was, but a microphone from Amazon from Rode. Had a bunch of amazing reviews a few years ago and I actually got a counterfeit one. Then as I dove into the reviews deeper, all the negative ones weren't about the product they were about getting counterfeit products. So that's just a little side tangent there. But yeah, you can't always trust the sellers because again, it's a marketplace so people can lie.

So another one though is return policy. I would say that between return policy, knowing if you get something you don't like from Amazon, you can send it back, between the trust factor knowing they're not going to steal your money, between people assuming they're going to get the best price and fast shipping, those are really the main reasons that people keep going back. Maybe you can also add in ease of use because they've bought there before and they're comfortable with it.

But there's also a whole bunch of other reasons why people make buying decisions online and a lot of those are really where we can thrive. But before we get into how we can stand out, I want to talk about how we can come as close as possible to match those main reasons why people would choose Amazon. So fast shipping, you can have a dropshipping store and you can have fast shipping. Now this is true if you use the Drop Ship Lifestyle model and if you work with suppliers that are domestic to where you are.

Again, if you're in the US and you work with US suppliers, you can have products shipped out easily same day or at least next day and if you're selling big and heavy items, it's not unrealistic to even have them delivered to customers or businesses within five days. So you're not going to be able to match Prime or two hour delivery or anything, but you're definitely dealing with things that are very realistic and things that aren't going to cause customers to throw their hands up and be like, "I'm not waiting three weeks for something to come from China," because again, it's coming from a domestic supplier.

Now best price. With the suppliers that we work with and the ones that you should be working with too, they have what are known as MAP policies, M-A-P. Stands for minimum advertised price and what that means is if I get approved as an authorized retailer to sell for supplier ABC and you get approved to sell for supplier ABC and Amazon sells for supplier ABC, there's a minimum price that we can all sell for and what that means is they are not going to have a better price than we are. So at the very least we'll have our prices matched, which is typically what you see amongst everybody, not just Amazon, but it would be my site, your site, anybody else selling the same products.

Now, not everybody's going to say yes, but some people will, and when they do, you're going to get to actually put your ad on other people's websites for 14 days, and when that happens and you're using Google analytics, you're going to see who is coming to your website from what other websites, you're going to see who is buying, you're going to see what the traffic is worth. Now if 14 days goes by and you get almost no traffic and no sales, then it doesn't matter anyway, and you tell the site owner, "Thank you. Appreciate the opportunity, but this didn't translate to success for us." No problems there. On the other hand, if you got a bunch of traffic and you get a bunch of sales, guess what? Now you're profitable and now you can have a longterm contract to advertise on those blogs or websites that already have the audience you want.

Now trust this one it's not something that's realistic to think we could build up the trust factor that Amazon has at all, but I do want you to be aware that you shouldn't just assume like, "Well, my site's new. No one's going to trust me. That's it." There are still things that you can and should do to get people to trust you even if it's their first time on your site. So some of the more obvious ones are doing things like showing off reviews and not just text reviews that anybody could fake, but also video reviews. If you have any photos of your products in customer's homes, you could show them off. I also do use and highly recommend trust badges and trust seals. They all have pretty much proven to convert the same across the board, but if you have any different trust badges or seals you like, then I highly recommend you put them on your site from day one.

Other ways to really convey trust and have that built right away are to have things like a phone number that you or somebody actually answers, to have live chat on your site that's really responsive. Those are the things that aren't going to get you to match Amazon's level of trust, but they're at least going to give you more of an advantage than you would have should you not do any of them.

Now return policy, what we do here is we match what our suppliers offer. So if supplier A says we have a 30 day money back guarantee or a 30 day refund policy, then for that supplier we'll have the same. So we don't take returns ourselves. We have like a small warehouse area now in the back of our studio, but we don't have products coming back here. When people want to return stuff, it goes back to the supplier and then our return policy is based on the supplier's, which is typically the case with Amazon as well. At least when you're referring to the type of brands that we sell for and the type of brands that you should be selling for also, and again if you're brand new here, go to dropshipwebinar.com to see exactly what those brands look like, how to find them, how to get approved for them. Again, dropshipwebinar.com.

Now let's get into some of the ways we can stand out because that was kind of how we can match what they do. And the first way is through expertise. Now since Amazon is a site that sells every single thing you could think of that's not a prohibited product, they're not an expert in anything and they're not going to give you expert advice on how to buy whatever product it is you're selling and they're not going to be able to answer technical or more advanced questions on different product types because again, they're just a marketplace. So they don't have that expert service and expert level of knowledge that can help people make better buying decisions.

Now being you're going to build a niche specific store, if you're following my dropship blueprint from Drop Ship Lifestyle, then you can become the expert in your niche and some of the ways you can convey that is by having better product pages than anybody else. Have more relevant information for that customer or potential customer. Make sure you have things like buying guides, make sure you have things like product comparison tables, make sure you have things like questions and answers, frequently asked questions, to things that people want to know because those are the things that Amazon cannot do at scale because again they sell everything. They don't go deep into any product type and for us, the dropshipper, because we build niche specific stores, we can do that. Customers appreciate that and when we educate them they buy from us. So you should be doing this as well.

Now the next place we can excel is with customer service and I don't know if you've ever had to contact Amazon for customer service, it is not fun. I've had to do it twice in my lifetime and once was because I had an employee buy something with my credit card and Amazon thought it was fraud. But then the last one was actually just a couple of days ago and it was, we ordered something and the shipping address got messed up. An old zip code with a new address and we were trying to cancel the order because it was going to arrive nowhere and the online cancel buttons weren't working.

We had to call in, got transferred around, spoke to somebody that sounded like they were in a room with a thousand other people and by the end of the call had no idea if it was successfully canceled or not. About an hour later got a confirmation email saying it was, but it was the least pleasant experience you could have when it comes to customer service. I don't think it's because Amazon doesn't care about their customers by the way. I think it's because their volume is just so high. They are just grabbing for straws at this point. They're trying to be able to support people, but to get that personalized customer service, it's impossible. They have too many customers. So their weakness there could be our strength.

So another one, special offers. This is huge. It's something Amazon doesn't do. But when I'm talking about special offers, I'm not just talking about discounts off price. I'm actually also talking about giving customers extra items. We call these bonus gifts. So I typically go with the same example, but let's say you're selling a standup paddleboard. You can say, "Hey, when you buy your stand up paddleboard from us, we're going to include a paddle for free." Or, "we're going to include this rash guard shirt." Whatever it is. But you can build these special offers into your product pages, which is something unique that Amazon doesn't do.

So if somebody is even on Amazon already and looking at your product page side by side, and they know hey, if I buy this from Amazon, I have to spend an extra 50 bucks on this paddle. But if I buy it from your paddleboard store, that's already included. Okay, I'll take that all day. So you can do this on your store. You can come up with creative offers, you can create different bundles. You can stand out from the competition, from Amazon, get more people to choose you.

So the next one is content/marketing. So this was originally, I had it broken up as two different sections, but they kind of do fall into one because again, with Amazon being a marketplace selling everything, they don't have specific content that speaks to different buyers about different products, about different industries. Because you're going to be the expert you can create content that speaks exactly to who your potential customer is. Not only that, but you can place targeted ads on the influencer's pages, on the blogs, on the YouTube channels that are related to the prototype you're selling. That's going to give you a leg up on Amazon because Amazon can't do that. They can, but again, it's a scale thing. They would need a team of 100,000 people in a room somewhere probably to make that work. But you could do it because you're going to have one niche. You're going to know where your audience is. You're going to create unique content that speaks directly to them and you're going to be able to market that content right in front of them, very targeted, very easy. Get those people to find you and choose you.

And finally, relationships. When I'm talking about relationships, I'm not just talking about emails you get from people. I'm talking about the whole buying experience, the whole site experience, and when you have your own store, when you can speak directly to your avatar and your potential customer, when you have followups in place that show you actually care after people buy, you're building real relationships. Not just a simple transaction of where's the best price? Where's the fastest? Where can I buy right now? But something that when you recommend products in an email a month from now, three months from now, six months from now, you will have people that will stand with you, that will choose you because of the relationship they have with you, because of the customer service they got from you, because of the expertise that you've proven to them through your content and through really everything you've been doing to stand out from Amazon from day one.

So this is it guys. Again, when I say competing with Amazon, I am not talking about putting Amazon out of business because you're going to sell $500 billion of products. I'm simply talking about why our stores and why our student's stores at Drop Ship Lifestyle still do so well. It's because we match as close as possible the things that make people choose Amazon and then we really go hard on the things that allow us to stand out, allow us to be unique and allow us to build really loyal bases of customers. So as always, I hope you found value in this podcast. If you did, be sure to hit subscribe and definitely leave a review over on Apple podcasts. Really helps us out. And that being said, guys, I appreciate you and I'll talk to you in the next episode of the eCommerce Lifestyle podcast. See ya.

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