Trevor: Hey guys, welcome to the eCommerce Paradise podcast. I have a buddy of mine on. Kevin is his name and he's a eCommerce entrepreneur just like I am and I wanted to have him on there, 'cause I hang out with him for the last couple of years and we've helped each other to grow our eCommerce stores kind of like a mastermind style and he's done some amazing things with his store and I wanted to kind of just chat entrepreneurship and get his best tips for eCommerce entrepreneurs doing high-ticket drops, so welcome to the podcast, Kevin.
Kevin: How's it going, man? Thanks for having me.
Trevor: Cool. Thanks for being on.
Trevor: Everybody kind of has to start somewhere with this whole thing. My journey started around 2010. When did your entrepreneurship journey begin and how did it begin?
Kevin: Sometime in 2016. I had just gotten off class and I was driving to work that day and I heard the word drop tripping in a podcast. It was like a KCRW podcast talking about some guys that were doing dropshipping on Amazon and it sounded interesting to me so I just kind of Googled it, looked it up and then I came into a high tech of drop tripping, came into understand what that was and it immediately sparked my interest, so I just kept looking into it more and more, took a few courses, learned how to build websites and do AdWords and stuff and I think within the first after the day from hearing what dropshipping was and on the car ride to work from launching my first store was only like a six month period, so I was like pretty aggressive from the beginning to get it started. Yeah, so that was early 2017 when that happened, so it's been a crazy year and a half.
Trevor: It's a lot to have happen in a year and a half, man. That's wild. That's awesome.
Trevor: What attracted you to dropshipping as opposed to like some different online business model or any other business? Some people that want to start like a café or restaurant or some people like maybe they get into affiliate marketing, what was it about dropshipping specifically you liked so much?
Kevin: I've always kind of had the idea in my head that I wanted to start a business at some point and work for myself, have my own hours, have the freedom, but of course, when you're going to school, you're a student and you don't have that much money, there's a large barrier of entry to most traditional business models, so starting a restaurant or any other business model, I mean not any other business model, but most requires a lot of capital which I didn't have. So when I heard about dropshipping, it immediately sparked my interest, because there wasn't a lot of capital involved that's necessary to start a store. I think I started my first one with under 200 dollars or something. So that was cool. That was immediately what sparked my interest. I thought I could just do this in my free time on the weekends and I can just use my savings that I have, which wasn't much at the time, to get this thing started, so that's kind of what it was for me.
Trevor: Cool, man.
Trevor: It was a similar thing for me, too. I work in a full-time job. I realized I wanted to do something like a side hustle and so I got it going. Very low cost to start up and using some sort of eCommerce store platform, like Shopify, at the time I don't think Shopify existed or if it did, I didn't know about it yet, so I used a thing called eCreator, but similar thing, it had the website builder for you and you put the products up and it drives Google shopping ads. I was able to get some sales pretty quickly, so it's kind of cool how low the start up cost is and I think a lot of other people out there enjoy that.
Trevor: But it's a little different with high-ticket dropshipping as opposed to Aliexpress dropshipping. You were drawn to dropshipping, but how did you learn about the online retail method as opposed to importing from China or doing some kind of Aliexpress dropshipping from China, that kind of thing, 'cause that's really popular these days? Or did you not even hear about that method at all?
Kevin: Yeah, I didn't even really know about the importing from China method until maybe six months after I was kind of in the whole high-ticket thing. That wasn't really anything I was able to distract me, 'cause otherwise I don't know, I may have gone for that method, that business model, but one of the cooler things about the high-ticket model is that when you're comparing it to the Aliexpress model, you just want to sell high-ticket items and you don't have to sell as many of them to get the same result or the same net margin as you would with the Aliexpress model 'cause you're selling like 20 dollar items, so that right there attracted me over any model right off the bat. The fact that you don't have to do an incredible amount of customer service, at least not at first, is really attractive to me. Just selling really expensive things.
Kevin: When you first start, you have like one sale a week or two a week, so you're not really dealing with that much customer service and that's something that was definitely something that attracted me from the beginning.
Trevor: I've been doing a lot of coaching lately and I get a lot of questions from people that are thinking about starting out and one of the biggest concerns that they have is are they gonna be able to afford these higher ticket products. I guess a lot of people, they don't have good credit or something like that.
Trevor: Is that something you had to deal with at all or were you pretty well set with credit when you first got started, like had a good credit, had credit cards, stuff like that?
Kevin: Are you referring to like when I make a sale and I put the suppliers invoice on my credit card?
Trevor: Yeah. Exactly.
Kevin: Yeah, I didn't have very good credit at first, 'cause I was like 23 or 24 when I first started. I'm trying to remember what I did. I didn't let that stop me, that's for sure. I think I just applied for a credit card and I told the credit card company that I made like way more money than I did. I got a pretty high limit. I think I got like a 6,000 dollar limit, now that's not very high for me. I wouldn't worry now for my business, but it worked then and it was good enough to make that happen.
Kevin: There was a point where I was using my debit card, my credit card, my other credit card to like put all the suppliers, to pay for all the products as those were coming in, which is a mess when you want to do your taxes so I don't recommend doing that, but I just did whatever I had to do and I didn't let that hold me back. That never held me back, so I don't know.
Kevin: But I do hear that question a lot now when I do coaching calls, as well.
Trevor: The other big thing that people run into when they're first getting started is niche selection, choosing the right product to sell or maybe choosing a bunch of products to sell.
Trevor: Without mentioning your exact niche, maybe you can give a little bit of tips as to like how you were able to find your niche and realize it was a good one to go into and stuff like that? What kind of research did you do?
Kevin: So like certain criteria that I look for when I'm picking a niche, definitely I like to have the average product's price to, personally I like it to be like 800 to like 1500 dollars. A lot of people will go for the like 200 to 500 dollar niches, which I don't really like. Whenever I get a 200 dollar sale, I'm like kind of disappointed. I'm more of like a 1000 to like 1500 type of guy.
Kevin: Another criteria or something to look for would be like hobby niches work pretty well. Two of my stores are in the hobby niche, like a passionate niche, if you will. People are buying them are buying them for leisure. They want them. They're excited to buy then. It's not something that they have to buy. It's not something that's like a business to business.
Kevin: The business to business niches are great, too. I'm sure there's plenty of potential, but that's not something that I've done and I know that the passion niches work great.
Kevin: Another thing I try to look for is if the customer can just go down to Walmart or Target and buy that product today and they don't need to buy it online, that kind of scares me a little bit, because then they don't need to go online. I know a lot of people who do sell things that are sold at Target or Walmart, but that's just something that I personally try to stay away from.
Trevor: Okay, cool.
Trevor: Yeah, lots of good tips there. Choose the right price point. Choose the product that can only be found online. Choose the right market for that product and stuff like that. That's awesome, man.
Trevor: What I usually tell people is like, "Hey, just choose a niche, because you need to just get started somewhere and then kind of learn as you go."
Trevor: So how many stores have you done? I think you have a couple, right?
Kevin: Yeah, three right now. Just launched my last one. I launched that one on Friday, so that's cool.
Kevin: So I have three now and I started one when I first started my journey and that one didn't work, so I guess that's a total of four. So my first one failed and I have three now.
Trevor: Well, even though it failed, you probably learned some good lessons from that, right? And you were able to apply those lessons to your new stores?
Kevin: So starting my second store after the first one that failed was a lot faster. I was able to get that one started a lot faster. I applied a lot of things I had done wrong on the first one to the second one, yeah.
Kevin: If you guys fail the first time, don't worry about it.
Trevor: Yeah, just keep pursuing the next one.
Trevor: It was funny, I was reading a little post on my Instagram feed about Elon Musk and how many businesses he's started. I think he started more than ten of them now, a bunch of which he's actually sold and doesn't run or anything like that anymore. And I just thought like, "Man, I could probably make the similar infographic with like 20 different websites I've started and closed down that are technical failures, but in reality, they're just lessons that I learned on the way to making more profitable stores." It really only takes one store to have a nice full-time income, even if you live in an expensive city or something like that.
Trevor: With that said, how did you finally figure out how to get your stores profitable and what kind of methods did you go through to make that happen?
Kevin: Something I did differently the second, third and fourth time that I did from the first time was just having a really good understanding of AdWords. That was what kind of killed me the first time I failed. I didn't really understand AdWords very well at all, so I was spending a lot of money on getting traffic that wasn't converting and so that's kind of what did it for me.
Kevin: I was running a lot of search ads right off the gate and I was bidding on generic search terms which can be good, but I don't really like getting generic search terms. I think branded ones work the best, but of course it depends on your niche.
Kevin: I just spent a lot of time learning how to use AdWords. I paid for coaching, got help from people, asked a lot of questions, did my own research, took courses, et cetera and then with that knowledge going into the second store, I was able to turn a profit, because AdWords is always gonna be your biggest expense. Well, it is for me at least, so something you need to learn.
Trevor: Yeah, I think depending on the month or whatever, we'll spend two to 3,000 dollars in AdWords to make somewhere between 30 and 60,000 in revenue or more, so it's definitely your biggest expense, but it's also your revenue generator, so it's worth learning good. I think you said you had taken a course on AdWords directly from Google, right? You got certified on it. You mentioned that.
Kevin: Yeah, I got certified. That was a while ago.
Kevin: To get certified, you sign up for, I forget the name of it, it's like Google something. I can't really remember now, but you take a course and you answer like 100 question exam, basically. I felt like I was back in college.
Kevin: It was pretty informative. It's not gonna make the biggest difference. I would probably focus more on getting coaching, like one on one, 'cause it's more targeted to what you're doing, so getting certified will help, but I think getting coaching or taking a good course on AdWords would probably be the best bet, or at least for me it was.
Trevor: Cool, yeah.
Trevor: I just wanted to shoutout to the people listening to this podcast right now that I broke down an entire, I call it the priority funnel method. I just came up with a name for it, it's great. But it's the, other people call it the upside down funnel system, and it's this funnel system in shopping ads where it works really cool where you have three campaigns and you structure them with priorities so that certain keywords mix through them and you bid higher on the keywords that are more closer to the actual product so that you get customers a lot better.
Trevor: So I broke down that whole system and it's all in the masterclass, so if you guys are interested in taking a course that breaks everything down, go check out eCommerce [inaudible 00:13:40] Masterclass. It's for high-ticket dropshipping specifically, so it's all about that business model.
Trevor: Let's move onto the next thing, Kevin. It's really cool you have these profitable stores now. It seems like you're doing really good. I'm excited to hear about your next store and the success you have there.
Trevor: What's kind of like a day in the life of your life now as opposed to what it was back in college and stuff like that?
Kevin: So nowadays, it's Monday through Friday, I work 9-5. It's kind of funny, that once you get your freedom, you pick your own hours, but I actually decide to work 9-5 every day, Monday through Friday. I try to wake up at eight or nine, get to work, just hang out in my room, try to put in eight hours the best I can, hang out with my dog, he just sits next to me all day and bugs me. If I have some errands to do or I feel tired that day, I'll just get off a little early, go skating, take the dog to the dog park, hang out with friends. It's kind of whatever I feel like.
Kevin: I try to be disciplined and put in the work, but sometimes you just wanna hang out. I think that's alright.
Trevor: What kind of things do you do on the weekends? You said you go skateboarding. Do you go hiking? Things like that?
Kevin: Weekends, go skating with friends, go out to the bar or whatever, go camping. I've been doing a lot of camping lately. It's summer right now. I have a few trips coming up. Went to Spain a few months ago. Went to Cancun a few months ago. Going to Mexico on Friday, a few days from now, so I have a lot of trips that I've been doing and that I have coming up, so those are the types of things I like to do on the weekends and go camping or whatever.
Trevor: Yeah, there's something that's different about the work from home lifestyle. Whether you're a digital nomad type, you like to hop around coffee shops or you like to work from home, it doesn't really matter, you still get to control your hours, like take breaks whenever you want to, eat whatever you want whenever you want, spend two hours on lunch if you want, maybe spend a half hour on lunch if you really want to crush some work out. Get off work at three o'clock and go skate, you know, come back and work later in the evening, just do whatever you want. It's cool, man.
Trevor: Ever since I started this lifestyle, I'm loving it, too. It's super chill and I think like you were saying, part of it is just being disciplined and diligent, you just want to make the most of the time that you're working at. In my opinion, it's not about how much you work, it's about how much work you get done in a short period of time so that you can go out there and see some amazing results.
Trevor: By the way, I kind of wanted to ask you really quick, what are some of the results you're getting from your store like saleswise these days? How are your stores doing?
Kevin: Yeah, definitely.
Kevin: My main store, it's seasonal, so it's kind of hard to give you an average number, but I'd say on average, it does like 70 to 80,000 in sales. During the busy months, I think we've seen the highest number be on 100,000. I think my best month was 110,000 in sales and that's just from one store. So that was great.
Kevin: But on average, I'd say it's about 60 to 80. I guess I'd have to look and see the data, but yeah. It's the slow season right now and we're still doing like 50 to 60, so it's not bad, definitely not bad at all. That's about like a seven to 10 percent net margin, so it's not bad.
Trevor: I think that's pretty average when it comes to hobby passion niche kind of stuff, right? Little bit lower profit margin.
Kevin: Yeah, yeah.
Kevin: I think that's pretty average for most.
Trevor: Most niches probably even.
Trevor: Yeah, cause you're gonna deal with shipping. You're gonna deal with some costs here or there.
Kevin: Yeah, I'm pretty aggressive on ...
Trevor: Like AdWords and stuff?
Kevin: On AdWords, yeah. I think last month I spent like 4,000 dollars in ads and like have three ...
Trevor: Yeah, it cuts into your profit margins a bit.
Kevin: [inaudible 00:18:01] it's a little bit expensive, too.
Kevin: It is what it is. Just trying to get it scaled up as fast as I can, so I'm willing to put the money back and see the results quicker.
Trevor: Okay, dude. That's awesome, man. So great to hear you're doing good and thank you so much for providing the listeners and the audience with the tips that you have to offer. I mean a lot of people out there, they're starting their high-ticket dropshipping careers and hearing from somebody like you who's been successful after a year, so it's just really, really inspiring, so thanks so much for being on the podcast, Kevin. Really appreciate it.
Kevin: Thanks for having me.
Trevor: Cool, guys. Alright. Talk next time.