The ecommerce industry is one of the few sectors unscathed by the ravaging coronavirus pandemic. A significant shift in consumer culture and the growing appeal of online shopping have had a positive global impact so much so that cross-border ecommerce surged by 82% in 2020. What this means is that more consumers are taking to online shopping amid the growing uncertainties that come with health crisis-induced economic woes.
The growing appeal of online retail services is indicative of the pressure put on manufacturers, wholesalers, and retailers to suddenly meet the ever-expanding requirements for running online stores. Those who are yet to invest in their online channels at the peak of the coronavirus crisis had found it a lot harder to weather the economic effects on brick-and-mortar stores. In contrast, those with functioning online shopping outlets fared better. A survey revealed that 38% 0f established 100 ecommerce players across Europe and North America reported an increase in online profit margin during the lockdown.
It is worth noting that this ecommerce trend has had a direct impact on dropshipping. Dropshippers are leveraging the surge in online shopping and attracting significant traffic. The changing consumer behavior is favoring this ecommerce sector because these businesses directly interact with consumers and reduce the mounting pressure on retailers, manufacturers, or wholesalers. Hence, it comes as no surprise that this market segment is expected to reach US$ 591.77 billion by 2027. However, this venture does come with its own set of unique challenges, as exemplified by the resource and experience required to maintain an above par customer-centric retail service.
To become a profitable dropshipper, you have to understand the current market dynamics and integrate the appropriate systems. One of the individuals that have grasped this fundamental truth is Can Tayfun Mandir, a 20-year-old entrepreneur based in Hannover. Can Mandir has built a successful dropshipping venture from the bottom up, and he has rightly positioned himself to capitalize on the ongoing ecommerce boost. Mandir is aware that online retail has evolved from a convenience-inspired shopping experience to a necessity. And so, he has put in place the resources needed to demystify consumer behavior and get the most out of an explosive market segment.
In a recent interview with Can Mandir, he shared that dropshipping is a less risky ecommerce venture since dropshippers do not have to stock products in warehouses. Regardless, it is imperative to set up the appropriate strategy to establish a sustainable business. Most of the factors that determine the profitability of a dropshipping business boil down to customer services, marketing, and shipping. Below are more excerpts from the interview.
How did you discover the ecommerce landscape?
I have discovered it on the Internet. The Internet has opened up the opportunities to me which were not conceivable before. I have been engaged in e-commerce for over 4 years with the purpose of building one of the largest e-commerce brands in the world.
What is your take on the performance of the ecommerce sector in the past year?
The sector has received a huge boost from the current crisis. Sales have increased enormously with more and more people shopping online. The upcoming future is all about online sales. It is especially true about 2020, as it was the most decisive year. The next decades will mark enormously high sales volume for everyone involved in e-commerce.
Do you think that online shopping will still retain its current appeal in a post-pandemic era?
The e-commerce market will continue to generate the growth of revenue. People began shopping online more frequently, as online shopping becomes more and more convenient and economically advantageous. Ordering products from home worldwide has never been easier. The online shop entrepreneurs like us enable customers to get a better service. Soon, online shopping will touch upon all category of products and services.
What are the requirements for setting up a dropshipping venture from scratch?
It is all about discipline, patience and willpower. E-commerce knows no boundaries, which is why it is so hard to measure its true potential. More and more people are willing to shop online, which was previously unthinkable. The innovation with a smartphone clicks to order products worldwide makes it possible for people to order comfortably and stress-free, no matter where the product comes from or where you are located in the world. In order for it to work, devices such as laptops and smartphones as well as an active internet connection are always needed to be able to sell online. You should also be able to devote it 2 to 4 hours a day
What are the major barriers to running a successful dropshipping business?
People's mindset is often the biggest barrier. It has never been easier to shop or sell online. There are still many people with an old mindset, who often leave their homes to go to the city center to buy things. It is no surprise that department stores in the large and small towns die out. Online competition is taking over the market and attracts more and more customers. Those who start a business in dropshipping/e-commerce find it difficult to enter the market with their own online shop/products. Moreover, the subject of Branding remains quite relevant, many entrepreneurs are reaching their limits. We offer them an all-around solution through consultations, so that they can solve all their problems conveniently and at little cost.
Considering that new shipping policies are being enacted by different regions as coronavirus measures, how can dropshippers track these regulations and ensure that they comply?
There are not that many restrictions on shipping terms or policies. The packages from the Asian region are usually shipped in a few days. It is especially true with China, as the country quite rapidly recovers from the Corona crisis. They are the big winners of the crisis in the economic aspect, especially since their economy was growing rather than declining. We in e-commerce are among the few in this world who have seen great opportunities in sales due to the crisis or who can still see such opportunities. The future will be designed for more and more people to make purchases online. In the coming years, we expect a strong increase in e-commerce sales worldwide.
As a dropshipper, you interact with consumers frequently. How do you think the pandemic has changed consumer behavior?
When it comes to online shopping, the consumers are craving it more than ever. More and more people work from home these days, which means they use their smartphones more often. In this regard, we can ensure that our advertisements are displayed to them more often. The e-commerce potential and buying behavior becomes more and more immeasurable.
What are the technologies that an average dropshipper can use to gauge the alterations in consumer behavior?
Feedback by e-mail as well as email marketing in general is extremely crucial in this regard. By constantly supplying the customers with lucrative e-mails, the customer starts to feel that he is taken care of. You may also make customers trust you more through product reviews. This can be achieved by sending them discount codes or by sending a discount code after a purchase of a product, which can be later redeemed.
What other integrations will you advise dropshippers to implement for optimum operation?
There is not perfect marketing tool, which can help achieve tremendous sales. Those, who adopt a longer-term perspective and are willing to understand it, will also be able to find the key to success. Oberlo is by far one of the most important Apps when a person makes purchases through Shopify. It is quite hard to give a definition to a perfect App.
Speaking of technologies, what is your take on cryptocurrency in the ecommerce sector? Why is it harder than imagined for digital assets to become a prominent component of this market?
The crypto-market turbulence will be continued. As far as the e-commerce market goes, payments using crypto-currencies are becoming increasingly popular. According to the trends, every online shop in the world will soon adopt its usage. It’s hard to tell how it will affect the world we live in today; I can't really say. According to my forecast, the crypto-currency will be fully integrated into our lives and we won't be able to image our every-day life without cryptocurrency.
Tesla revealed recently that it plans to accept Bitcoin in the future. Does this exemplify the growing demand for digital asset payment channels in the ecommerce scene?
Not yet, but in the long term it may be possible. Elon Musk is a visionary, I would even say that he is one of the greatest visionaries of our time. His words and actions matter and have a direct effect on the market, and it has been proven many times through his social media posts.
Do you see more ecommerce and dropshipping players accepting crypto as a payment method soon?
Personally, I don't know anyone who offers it. In the long run, however, there is a lot of potential to it as the demand grows and customers are willing to pay with crypto. I'm quite optimistic about it.
Considering that you are a young businessman with a high tendency of adopting unconventional methods of doing business, do you think that your age had a major impact on your current outlook on cryptocurrency?
This is true, I am young. However, I have the advantage of identifying the market of tomorrow early and conducting an evaluation of opportunities. The young generation knows what is up in the world and what's not. We recognize trends that have not yet been hyped, but which have the potential to be hyped. The time is on the side of e-commerce. If there are those who know what the future looks like, it's the younger generation.
How has the bull market changed the way people approach crypto payment or the technology itself?
The Market trend is causing more and more people to start investing. Crypto currency plays here a major role, as this topic becomes particularly important in 2020 and 2021. People live in dynamically changing environment and are keeping a close eye on everything going on around them, feeling what is good for e-commerce entrepreneurs, as well as what poses a great danger to investors, who are usually inexperienced.
What are your projections for the ecommerce market, particularly the dropshipping subsector?
The market will continue to grow and the buying behavior will change in a way that you will only buy branding products - no 0815 crash products. Likewise, the current situation means that people are always tempted to sell online. Offline shopping becomes the past, while online flourishes. The future will show in what direction it will eventually evolve.