EFP 59: Building Niche Dropshipping Sites With Andrew Youderian

Justin Cooke

August 8, 2013

Can an Amazon affiliate site be turned into a dropshipping or even an eCommerce site? How would one go about doing that?

Introducing Andrew Youderian of eCommerce Fuel

I’ve always been interested in eCommerce from my eBay dropshipping days back in college and this week we were excited to sit down with Andrew Youderian from eCommerce Fuel to discuss how to build out niche dropshipping sites. He’s put out some killer content on dropshipping and eCommerce and we just had to have him on the show to find out how he’s built profitable sites from scratch.

If you’ve been interested in finding out how to expand your niche sites into “authority” sites or you’d rather focus on less sites that require more of your time, this is definitely an episode for you.

Check Out This Week’s Episode Here:

Direct Download – Right Click, Save As

Topics Discussed This Week Include:

  • Listing more “featured sites” at EmpireFlippers
  • Niche Selection – KW or product first? Quantity or quality? Finding dropship suppliers?
  • Traffic Sources – Linkbuilding and content marketing strategies
  • Platforms & Software – Shopify, WordPress, etc.
  • Customer Support – How do you best serve your customers?
  • Scalability – Can we modify our team to build dropshipping sites?

Mentions:

So…are you digging the eCommerce approach? Do you think Amazon sites can easily be converted to dropshipping sites? Let us know on Twitter, drop us a voice recording, or leave us a comment below!


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Discussion
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  1. Tom says:

    Hey. Great podcast. I’m in the process of researching a niche at the moment.

    At about 45 mins you talk about extras that you include in deliveries to endear the customer to your brand. I just wanted to ask how you arrange that with the dropshipper. Is it something you arrange at the start of the relationship? Are they usually happy to include branding and goodies
    on your behalf?

    Cheers

  2. RCNitroToys says:

    Dropshipping works best when you have a reliable supplier. I use the supplier here. http://stumbleuponguru.com/trusted-dropshippers-and-wholesalers

  3. Iain Robson says:

    Great episode.

    After listening to this episode, I went over and checked out EccomerceFuel.

    It’s a pretty amazing site. I’ve doing a fair bit of reading related to dropshipping. Andrew and Shopify wrote a fantastic book about dropshipping. It gives a solid idea as to what you’re getting into.

    Also, I started listening to the EccomerceFuel podcast as well.

    This episode really got the wheels turning. Got me thinking of a whole whack of things.

  4. Hey guys,

    That was a great episode, lots of good info in there. Its actually made me want to go back and revisit one of my earlier sites that was based on drop shipping, and implement some of the tips that Andrew put out there…

    • Justin Cooke says:

      Thanks, Darren!

      I like the drop shipping model, although it is significantly different from what we’re doing now. Joe and I have talked about buying our way in to some drop shipping sites next year…we’ll see!

  5. Anton says:

    Hey Joe & Justin,

    I’m pretty sure that it was me who told you it is best to build a mock site prior to contacting suppliers. I know that it seems backwards but just to clarify it’s not the first step of the process… I don’t build stores until having done all of my market research and feeling more than confident that I will find success in that niche. Only after the research is done will I have a store set up and then begin contacting suppliers. Like Andrew says in the podcast it is VERY easy to do with Shopify (that’s the platform that I use as well).

    Of course, not every supplier will require that you have a website prior to approving you but based on my expierence the 80/20 rule applies here. 80% of your sales will come from 20% of the suppliers you get approved with and based on my experience those 20% of suppliers will not approve you unless you already have a website in place. They’re the most difficult ones to get approved with but they’re also the ones that you really want.

    Another thing you guys touched on in this podcast is managing the logistics when selling for multiple suppliers on the same store… I agree, this can be a nightmare and it was back when I first got started with drop shipping but things have become MUCH easier.

    For anyone wondering how to manage this I HIGHLY recommend eCommHub. It integrates with almost every major eCommerce hosting platform and it’s saved myself and my VAs countless hours of work.

    Thanks for another quality podcast guys,
    Anton

    btw, I’m still working out of Chiang Mai. Hope to see the both of you guys this October in BKK,

    • Justin Cooke says:

      Hey, Anton!

      Yeah, man…I believe it was you that told us about setting up the site before reaching out to suppliers, hehe. That makes sense to me…you’re coming at the potential supplier with something “real” to let them know you’re serious.

      Thanks for the eCommHub tip!

      I’ll be in Vietnam (HCM) at the end of September and have fairly open plans – arriving in BKK on 10/14. I’ll be there through 10/21 and then was planning on taking a trip down to Phuket to relax for a week or so with the GF and friends… Looking forward to meeting up!

  6. Jimbo says:

    I always enjoy the “do what you love” versus “let’s be real, we’re here
    to make money 1st and foremost” debates that you guys get into from time
    to time.

    Thank you Joe “the voice of reason” Magnotti for keeping everybody honest. Big fan of Andrew Youderian since I heard him on some other podcast.(i’ll link it in the disqus comments (c) Justin lol)

    I believe that he mentioned more of his background in finance and financial analysis in that podcast which, in my opinion, gave him the confidence and courage to pursue the CB radio venture, despite him not being passionate about CB Radios. I’m guessing that the numbers had to tell him something that the outward appearance of the business did not.

    And the ability to look at balance sheets, look at markets in a systematic and mathematical way is usually what gives professionals a long term advantage over hobbyists in business and investing. (it also makes them predictable, and they can be hit by white swans and grey swans…that’s another topic)

    To tie it all together, I think Joe’s concerns were super valid

    – it seems difficult to do a shot gun approach here, but I do like the idea of slapping up an Amazon store/or KW researched Amazon blog and selling that way would be a good way to test the market and get valuable market intelligence. I hope Spencer Haws over @ Niche Pursuits was listening, cause it’d be interesting to see him mix in some drop shipping in his amazon review site.

    – the deep customer knowledge necessary to give more value than the low cost provider – great point. Although I like that Justin had faith in the staff and that they could learn to do that as well.

    Amazing episode, probably the best one you’ve done all year.

    • Thanks Jimbo, glad you liked it. I’m impressed that andrew was able to change direction and think on his feet when pressed about his approach. He knows his stuff, so for anyone interested in getting started with eCommerce, it’s a great place to start.

    • Hey Jimbo! Thanks for the comment, and nice to meet you!

      I’m definitely a numbers geek, so guilty as charged there, so that was an asset that helped in the initial startup of the site. Like I mentioned, doing a top-down approach (ie – what’s most likely to succeed based on the data) was more important to me than selling a product I loved.

      And like I mentioned in the comment below, I think it’s possible to test markets via Amazon stores and get a limited feel for the market, but setting up a business and selling direct is really the only true test of how something performs. For example, people may buy things through Amazon affiliate links all day long, but when it comes time to buy something from you (an unknown store that’s not trusted like Amazon) it’s a completely different ballgame.

      • Justin Cooke says:

        Hey Andrew,

        I just got off a call with Billy Murphy from Forever Jobless. His approach to niche selection is much closer to ours in that it’s data-heavy on the KW research side of things. It’s cool to hear there are several different approaches that are successful in the area of eCommerce/Dropshipping.

        His initial approach was a bit more shotgun with lots of smaller sites, but he’s saying he’d do it over with one much larger, branded site if he had to do it all again today. Interesting stuff…

        • Hey Justin! Yeah, Billy is a great guy to talk to in terms of eCommerce and niche selection. He’s got tons of experience.

          Just to clarify: In terms of picking a niche, I do take a very data driven approach – especially when I’m taking a list of 50 or so potential ideas down to a short list of 5 or so to really investigate. Keyword research is right there at the top of the list, and is what I use to disqualify niches that get too little searches. From there, with a short list, I’ll go through and rate all the niches on a number of different criteria (competition, profit potential, ability to market, ability to add value, suppliers, etc).

          I probably wasn’t very clear about that, but my top-down approach is really analytical. So in terms of having a team help with some of the heavy-lifting, I think that process (from going to 50 to 5 niches) can be systemized.

          But when you get down to your top 2 or 3 choices, it can be more difficult. Niche A might be might easier to market, but has less profit potential than niche B. Niche C has amazing suppliers but is much more competitive. So at that point, it becomes a judgement call in deciding which factors are most crucial given the nuances of the niche and each category. And I think that judgement call should be made by the entrepreneur (vs a team / process) as eCommerce businesses usually take longer to scale up and so more rides on the decision.

          Hope this makes sense, and sorry for such a long reply! Would love to hear you interview Billy on the podcast in the future…

  7. Quinton Hamp says:

    Blown away with how you guys candidly disagree with each other without ruffling feathers. You each have your opinions, and you use your individual view-points to help counter each other and carve out a cautious business plan.

    It’s a cool dynamic to listen to.

    Great questions. You guys really “hit the nail on the head” with this interview. Having just started my first Ecommerce site, I’ve got to say that the thing which impresses me the most is how well Google ranks these sites. Other than getting listed in a few directories, my site has no backlinks, but consistently gets about 1800 visits a month with about 50 products listed.

    Plus, you can drive traffic from shopping sites and advertising on places like Amazon — avenues you can’t use with adsense-style sites.

    It’s just another income source, and one that I am convinced is going to be more “google proof” as we move forwrd.

    • Thanks Quinton. Justin and I disagree often and our arguments can get heated, but we always come back to the thought that this is healthy for the business. And that’s what matter most.

    • Thanks Quinton! Some of my favorite discussion are passionate – but respectful – conversations about two very different sides of an issue. Tend to learn more that way, too. :-)

      Best of luck as you’re continuing to grow the business!

  8. Hi

    I loved this episode. Andrew is awesome. Really like all the insights and info.

    Joe and Justin – I actually like the way ecommerce sites are going to be more long term and difficult to enter :-) most people are lazy and want quick bucks.. They don’t want to knuckle down.

    Surely you can find niches where a higher level fillipino worker could be cost effective on a site when it’s up and running? Not all niches.

    Given women buy more than men how about female centric ecommerce stores..

    Again thanks to Andrew for sharing so much here and on his blog

    Regards

    • You’re welcome Steve, glad you liked the show. Agreed on the advantages of an eCommerce business, but you could waste a lot of time money and energy on something that doesn’t work out. That’s scary to me.

      • Hey Joe

        Your not wrong. But i think its a mind set shift. Lots of research. longer time scales for ROI due to investment but Bigger returns.

        Time will tell if that’s right or wrong.

        I however are with you in the sense that i dont want to be come an expert in each of my niches, although the simpler ones that’s possible, and want to be able to scale. I see some people on flippa trying to do that by building and flipping sites that are built but no revenue yet which does not appeal to me.I want to sell business’s

        • Justin Cooke says:

          Yeah – I don’t dig the site flipping when it’s pre-revenue. Anyone can slap up some content on a WP site and your barrier to entry to keep competitors out is extremely low…much better to get the sites earning IMO.

    • Thanks Steve – Glad you enjoyed it!

      I actually think there’s some opportunity in the market for very niche stores catered toward women. And I agree with you on the VA side as well. We have a few different team members in the Philippines who help out running our stores and they do an outstanding job.

      Thanks for listening!

      • Thanks for responding Andrew.

        Do you think we could develop a model to “test” niches for eCommerce?

        My current projects are amazon affiliate stores as a way to validate in a low cost manner whether I can penetrate a market. Before getting into affiliating with a large company or drop shipping.

        To do this we need a Formulaic approach much n the same was as Justin and Joe developed for empireflippers ad sense sites.

        This would help mitigate The concern of going to all in before finding the resistance. I wondered if it was in your course.

        Or is this just a flawed approach and you Go all in or don’t bother (having done a ton of initial research)?

        • Good question, Steve. I’ve always gone all-in to test after lots of research, but it’d definitely be possible to do a lighter weight test.

          With an Amazon store with affiliate links, you could use approximate CTRs and commissions to estimate which products are profitable and which ones are most popular. But it’s still different than having people buy something directly from your unique storefront. So could be a useful proxy, but I think it’d be hard to get a solid, reliable model down with this approach.

          Hope this helps!

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