5 Unusual Business Ideas From Multimillion-Dollar Entrepreneurs
Jessica: You’re going to meet Yuliya and Mike, who will be sharing their unusual business ideas. They are a husband and wife team whose dropshipping store made $2 million in the past year and a half, Now, I read the comments from all of Oberlo’s YouTube videos, so I know […]
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Jessica: You’re going to meet Yuliya and Mike, who will be sharing their unusual business ideas. They are a husband and wife team whose dropshipping store made $2 million in the past year and a half, Now, I read the comments from all of Oberlo’s YouTube videos, so I know what you’re thinking. “This couple might have made two million in revenue, but what was their actual profit?”
That’s a good question, so I asked Yuliya and Mike and they answered. Yuliya and Mike not only shared their profit margins, but they also shared tons of valuable advice and unusual business ideas for new dropshippers. They talked about how to create winning products instead of spending hours trying to find them. They mentioned the free marketing strategy, that they wish they started using earlier, and they talk about what apps help them run their business in real-time and keep track of dollars going in and out.
Do me one favor. After this interview, leave a comment to let me know what else you want to know about successful dropshippers. We want to publish content that you love, so tell us what you want to see. Okay, without further ado, let’s get to the interview.
Jessica: What’s interesting to me about you guys is that you’re complete smarties. Yuliya you’re a serial entrepreneur, you have a Ph.D. Why would people with a Ph.D., and people who’ve already started other businesses, start dropshipping?
Yuliya: So not all businesses are created equally, and we really wanted something that would give us total time freedom, location freedom, and financial freedom of course, and I had totally burnt myself out. I had a coaching business, where I was trading dollars for hours, hours for dollars. And I wanted something that didn’t need me in order to run, and that I could also sell in the end. Because having an hour-based business, a consulting business, if I couldn’t work, I couldn’t make money.
Jessica: So you’re working yourself to the bone with this consulting business, I get that. But if I were you, I would have wanted to jump out of entrepreneurship and just get a nice, stable job to pay the rent. So why not that?
Yuliya: Because I don’t like when people tell me what to do. I love the idea of being my own boss, and I love the idea of something that can grow exponentially. So to me, ecommerce seemed really interesting and exciting, because it’s something that I could scale like crazy, build a team, and can have it really automated and run without me, so I could just do whatever I want, and chill out and make money.
Jessica: Now, so far, you’ve been the one talking. Where was Mike in all this? Or was Mike not involved at this point yet?
Mike: Yeah, so I wasn’t involved in the beginning. You started dropshipping and I said, “Great, I’ll make breakfast.”
And then after a while, I started… You had a little bit of success, I started looking at some of your Facebook ads with you and realized that there was a lot that we could do to optimize things. So I could use some of my skill sets with numbers and kinda analyzing things analytically. So then I kinda jumped on board, and things started to really take off, it started to go really well.
And why I really liked starting into this is the creativity that I can use in this job versus some engineering type of thing. I felt like I could be a jack-of-all-trades here and kind of focus on many different hats as opposed to just doing one repeatable task over and over again, so I really like the freedom of that.
Jessica: So tell me about then, that first dropshipping store that you launched and then you started to work on?
Yuliya: Yeah. So we randomly started it. I randomly started it, one weekend, and Mike was like, “What are you doing?” I was like, “Just trust me. Okay?” And so it kinda, like, all of a sudden, started making a ton of money after a month, and he was like, “Okay, maybe there’s something to this.” And then he started looking into my ads manager. His super analytical mind was like… Where I was like an ads manager like, “Bloop, bloop, bloop, $10 here, $10 there, kill, kill, kill, scale.” He’s like. “There’s a better way to do this.”
Mike: Yeah.
Yuliya: And then we started making a lot of money, and then he’s like, “You know, maybe I’ll do this with you.”
Mike: Yeah, it just worked out timing-wise, everything worked out really good. I finished school, and by that point, things were rolling all along nice and smoothly with this, and it just… It seemed like the right play at this point, and it was going well and a lot of fun, so we just kept on doing it.
Jessica: But Mike, you didn’t just finish school, you finished a Ph.D. in Mechanical Engineering.
Mike: Correct.
Jessica: So, I mean, how did your family and friends react to the fact that you were not pursuing that and instead were pursuing dropshipping of all things with your unusual business ideas?
Mike: Yeah, it was a little touch-and-go at first, but really, ultimately, I have great people around me in my life, so everyone could see that I was much happier doing this and that this is really what we wanted to do. So ultimately, everyone was okay with it after kind of explaining what it was a little bit more and kind of showing that we’ve had some success with it already, so that was a big help.
Yuliya: We’re not scamming people online. This is legit.
Jessica: At this point, you’ve been working on your business for two years? And how has it changed your lifestyle? You’re working on it full-time now?
Yuliya: Mm-hmm. So we’re spending 24/7 together which is different.
Mike: We spend more time together, but it’s good. It’s a… Lifestyle isn’t really all that different. Wonder how you feel about that?
Yuliya: I think it’s completely different. I think we do whatever we want, when we want, we can just pick up and go, and we’ve traveled together a ton in the last year alone whereas… The entirety of us being together six years, we never traveled before. We have financial freedom now, and it really feels like our life is our own.
Mike: Yeah.
Yuliya: Whereas in the past, I worked 9 to 5, I was in grad school, and I felt like, even with my consulting business, my time wasn’t my own. Whereas now, we can just do whatever, and it feels really good to just know that we are completely replaceable in our business, and things can run smoothly without us constantly being obsessive over it.
Mike: Yeah.
Jessica: You’ve built a truly automated money-making machine.
Yuliya: Yes.
Jessica: Wow. Show us how to build that.
Mike: Let’s get into it.
Jessica: Okay, let’s get to the unusual business ideas, and we’ll learn a lot more about your store as we go, but let’s get to product number one.
Yuliya: Let’s do it.
1. Night Light Projector
Jessica: Are you recording or… Oh, this? Oh, this is the product? It’s the product, oh. What is this? I’ll turn it off so we can hear one another. I thought all this chirping in the background was just white noise. Okay. What the heck is this thing?
Yuliya: So this is unusual business idea number one. This is a night-light projector but as with any product, we like to say it’s whatever you make it. With building a strong brand, we feel something that’s so important is putting a unique twist on a product that’s already selling well or it’s a new and up-and-coming product. So this is a night light projector for kids.
But when I saw it, I thought of an ocean wave and actually, it says it in the product description too. And I know that mermaids are trending right now. And if you go on Google Trends, you can see that mermaids are super hot right now. And so we looked at this and we decided to call it the Mermaid Cove Night-light.
Jessica: Wow. Wait, I was looking this up on Google Trends as you were talking and you’re right. There’s this spike just now in the past 12 months in the US for mermaids. Are you psychic? How did you see this coming? How do you put mermaid trend plus this hunk of plastic with lights in it and come up with that?
Mike: Yeah, so this is like one of the games that we really like to play, where we decide to check all AliExpress hot sellers or on Oberlo hot sellers and try and find alternative dropshipping niches to sell them to. This product right here was trending very much so in the baby niche. And like Yuliya said, you can walk around the mall, you can see that mermaids are popping up everywhere…
Yuliya: Mermaids, unicorns.
Mike: And this is the kind of thing that would be a real perfect accessory for a night ambiance for someone in their room who really loves mermaids.
Selling to Niches
Jessica: I guess my question is why? Why go through the exercise of finding a trending product, but then doing the additional work of finding a different way to angle it, when it’s already getting sales as a baby night light?
Yuliya: I think it’s because we’re really passionate about selling to niches because things in niches can go viral. So people who love mermaids, they really love mermaids. So they’re more likely to share it, to recommend to another friend or gift it to a friend. So you get more bang for your buck with your ads and your social media. More so than, “Here’s a night-light for a baby,” which you still can definitely get sales doing that, but you don’t have that viral potential like within a niche.
Mike: And to add on to that, I think, if these products are winning products and are trending, they must be of good enough quality, people like them, they seem to work. So that is also a big angle that you have, that people like this product and you’re just trying to find a new target audience for it.
Jessica: So instead of finding trending products, you find trending niches and you think about what you could sell to them?
Yuliya: Exactly. That’s where the money is.
Jessica: Is that what you’ve seen in your own store as well?
Yuliya: Absolutely. And with that strategy we’re able to create winners also, rather than just finding winners, because we know our niche, we know the type of products that they like. So we can go through AliExpress and find products that maybe don’t have a ton of sales yet, they’re not saturated at all, and it creates sort of a blue ocean for us to just sell it to our audience without just ripping off another brand or whatever.
Jessica: That’s brilliant. A lot of times I’ll ask dropshippers about pricing strategy, because we’re looking at something here, this is between $17 and $18, and whenever we talk to dropshippers, we say, “Sell something people can’t get the price of.” If you’re selling a baby night-light to people who maybe don’t even have babies in their life, does that give you more flexibility to price things aggressively?
Yuliya: Absolutely. They’re not gonna price-check, especially with unusual business ideas. When you’re selling to a niche, it’s more of a passion buy, it’s not something that they need to have. It’s something that they maybe didn’t know they wanted. So when they see it and they see, like, “Oh, a mermaid night-light,” they probably just buy it. They’re not gonna shop around and look for a better deal for it. They see it, they buy it and that’s it.
Mike: A baby light has a known price range. You can shop around, they sell them. No one’s really heard of a mermaid light or a mermaid room light. So it’s a completely new market that doesn’t have a price range already. So it’s really however you define it.
Jessica: I also noted that if I saw this product, I wouldn’t go to myself, “I like this mermaid light, but I’ll go price-check it against baby night-lights.” I wouldn’t be thinking about what the product actually is, because you’ve redefined it for your customer.
Yuliya: Exactly.
Be Transparent With Shipping Times
Jessica: We’re on the AliExpress site for this Mermaid Cove Light, as you put it, and I see that… Actually, we can choose whether to ship this product from China or the US. Is this one of the reasons you’re recommending it? Because we can ship it from the US?
Yuliya: So actually what we found is that our audience doesn’t really care if it’s coming from China or from the US, as long as we’re honest about our shipping times. We actually tried for the holiday season to ship from the US, and we noticed that, honestly, it didn’t make a difference and it just killed our margins, and nobody really seemed to care. So we went back to shipping from China because it’s cheaper and if you’re honest, it’s not gonna affect your returns.
Mike: Yeah, that’s a big thing I’ve seen. If you’re honest about the shipping times and they have tracking, then people are willing to wait. They’re used to it at this point, and it’s really not as big of an issue as people like to make it.
Jessica: Where are you honest about shipping times? Do you put it on your product pages? Do you just put it in an FAQ in case they read it? Where do you put that information?
Mike: We put our shipping times everywhere. We have them in the FAQ, we have it on the product page and we also have it on our shipping option at checkout. And that was really interesting thing that we saw. When we didn’t have the shipping times on the checkout page, we had a lower conversion rate.
Jessica: Really?
Yuliya: Yeah, it’s a little weird.
Jessica: Even with those long shipping times?
Mike: Yes. And I believe the reason for that is if people… You can put the shipping times on the product page, people might miss it. But when they get to checkout, if there’s uncertainty about, “When am I gonna get this?” People will abandon cart. Even if it’s longer shipping times, if you’re honest about it and put it there, I think certainty is more important than anything else.
Jessica: That is really good advice. When I look at this product, it seems to beg for a Facebook video ad. Is that how you would sell this product?
Yuliya: Definitely. So something like that, just by looking at it, you don’t really know what it is. So with products like that, you definitely want like a quick little video just showing exactly what it does. It doesn’t have to be fancy, you could just shoot it from your iPhone just demoing what it is.
Jessica: Okay, I’m intrigued by this product niche mash-up that you do, and I’m going to put it to the test with your next product.
Yuliya: Okay.
2. Silicone Ring
Jessica: Can I see your… That is such a beautiful engagement ring.
Jessica: Oh, that’s your next product? Interesting. What is that?
Yuliya: So this is a silicone wedding band and usually, this is sold to the fitness community, and I found it trending on Instagram like crazy. I’m like…
Mike: What do they use it for?
Yuliya: All these people are working out wearing these silicone rings ’cause they don’t wanna damage their nicer rings. But then, randomly, one day I was in a travel group on Facebook, and there was a huge thread of girls saying, “I’m gonna go traveling, should I bring my engagement ring or not?” And there were so many differing opinions about it like, “Yeah, it’s no problem.” But most people were saying, “No, don’t bring it.” And then I thought, “Well, wouldn’t this be a great audience to sell it too”, because it’s a new way to use a product that’s already trending, but now we’re exposing it to a new audience who loves to travel but maybe doesn’t necessarily wanna bring their nicer jewelry.
Jessica: Yeah.
Mike: So what’s really great about these ones too is they’re cheap, and they come in all different colors so especially for traveling like Yuliya said, if you are worried about safety, if you’re in an unknown area. But also, you can accessorize them. They can match all of your different outfits.
Yuliya: So this is a great audience to target on Facebook because you can target people who love to travel or women who love to travel, and also women who love fashion and accessories. That would be a really great audience to expose this to because it’s building off of that fitness trend, but now you’re bringing it to more people.
Jessica: Yeah. So we’re on the… We’re on the AliExpress store for this ring and Mike, you weren’t kidding when you said this was cheap, and it’s not even a dollar per ring, and you can choose a ring size even and all these different colors, do you price this cheaply? Is this a free plus shipping thing for you? Or how do you price this?
Mike: Well, as you said, this is cheap, so we would price this probably around $15. But even more than that, since they are so cheap, and you can just pay for one shipping, we would love to bundle these together, so that way you can increase the perceived value, you’re getting more items, but you can still make a healthy profit off them. You can sell two or three of that. Say you could sell three of them for $20 or $25, which still leaves you quite a hefty margin there.
Product Flexibility
Jessica: This brings up a question though. I love the creativity behind finding a unusual business idea and then thinking of an alternate market or in the case of these, seeing a market demand and then thinking of a creative product for it, but what kind of store does a dropshipper build, so that they can have some flexibility with their product-market fit but still do bundled offers?
Yuliya: So we are all about the niche. So for a product like this, since we’re targeting women who love travel, you could build a Wanderlust theme store, and you can sell rings like this and backpacks or fanny packs are hot right now or passport covers. So these are all kind of in the wanderlust niche but different types of products, so you do have that freedom to rotate winning products and not kind of boring your audience but still having one unified umbrella.
Jessica: Okay. The advice is really if someone is new to this strategy, choose a niche and then once you’ve got that niche chosen, then think outside the box as to what products you could fit into that niche.
Mike: Absolutely.
Jessica: That is the way to go.
Mike: 100 percent.
Jessica: Okay, then that begs the question of how do you find a winning niche? Some dropshippers are all about the data, and others say you should sell something you love, what is your take on that?
Mike: I think it’s somewhere in between. You can certainly sell something you’re passionate about, but you really need to make sure you can speak to the audience. You have to know their lingo, you have to know the types of things that resonate with them, you have to just kinda know their dialect, what they say, what they laugh about, what other secondary things they really like so that you sound like you are a member of that audience, that’s the biggest thing.
Jessica: So if I were to open a store selling women’s travel and accessories, that probably would make sense for me, ’cause I love to travel, I know that I love watching videos about how people pack their suitcases which is maybe a secondary interest that I could include somewhere in the store. But if I were to open a store about automotive accessories, I’d probably get it all wrong, ’cause I would just always be like, “I don’t know, this is supposed to keep your windshield clean, buy it.”
Yuliya: Yeah.
Jessica: Is that kind of what you’re getting at?
Mike: Exactly. So if you’re passionate about it, it makes it easier, but if it’s something that you don’t know much about, and if you’re not passionate about it, then it’s something you really need to study and learn and make sure you learn everything you can about it. So it could be something you know nothing about, but you need to put the time and effort and to truly do all your market research and really understand. More so than understanding products is understanding how these people think, and what they like, secondary things that they like as well.
Jessica: This all sounds good. I want you to walk me through how I can figure out to talk more like my target audience then with the next product.
Yuliya: Let’s do it.
3. Dog Water Bottle
Jessica: This is next on the unusual business ideas list. Is this a baby bottle of some sort or…
Mike: It’s a giant ice cream scoop.
Jessica: It’s a giant ice cream scoop, finally one my size. Is that what it is?
Mike: No, this is…
Yuliya: This is a portable dog bottle. So you fill-up the water in here and then you press the button and it releases as much water as you want for your dog to drink, so you can go for a long walk in the park and have water on hand for your pup. So let’s say you wanted to start a store that’s all about crazy dog lovers…
Jessica: I’d like to.
Research Target Interests
Yuliya: And you really wanna learn what they love, how they speak, where they hang out online. The easiest way to do this is to just ask them. So what I like to do is I would go on my personal Facebook page, and I would say, “Hey, are there any dog lovers on here? I’d love to pick your brain for five minutes in exchange for a cup of coffee on me,” for example. And I would send them a five-dollar Starbucks gift card. So then you ask them, “Where do you hang out online when you wanna learn more about dogs? What social media sites are you using? Who are you following?” Because you can also, by the way, target these people later in your ads…
Jessica: I was gonna say. Why are you asking those questions? Their answers would be targetable interests.
Mike: Absolutely.
Yuliya: Exactly, targetable interest plus you can stalk these pages to see what sort of language that they’re using. I love something like this because this is a product that has actually gone viral already, but you can really niche it down. And we thought of two unusual business ideas that you could do that. One way is to target a breed. So you can target for example people who love pugs, say, “This is a portable pug water bowl,” and really target people who are obsessed with pugs for example. And that’s a way even though this is a saturated product that you could still make a lot of money off of it.
Jessica: Let’s just check something real quick before we get on to your other ways. The reason that comment makes me excited is here we are at the AliExpress page for this dog water bottle and you can choose different sizes. So if you were gonna target pugs as you suggest you could choose the smaller one, and then if you decide to target bigger breeds you could say, this is a Great Dane size water bottle. So even the product itself is set up that you could creatively target it to these niches.
Niche Down Through Causes
Mike: Exactly. Another great way we love to really niche down is through causes. So you can say this is for people who love rescue dogs, and 10 percent of the proceeds go to animal shelters. So that’s kind of broader breeds, but a specific cause that people feel passionate about, so you’re giving back which is positive, and people aren’t gonna really price shop or look around because they wanna buy from you to support this cause and really be in this community of people who are all about it.
Jessica: I’ve heard about this tactic, and I’m just skeptical that that works. Do you guys have experience or data that suggests it does?
Mike: Yeah, we’ve seen that works quite a bit. For any store that we’ve ever run, we always attach a charitable cause to, and we donate a portion of each sale or a portion of the profits to it, and we really see that that really resonates with our customers a lot. We tend to talk about it in our post-purchase emails.
Like, “Thank you for helping the cause.” ‘Cause, one, it does do great things, and these people really like to help, and people really like to feel like they’re helping, but also you really see that people like to buy more products from you, and buy again, because they’re really attached to the cause and they’re not gonna shop around for something else because they want to help.
Yuliya: And also, you’re assuring them that they did the right thing by purchasing from you. They probably have never heard of your brand until they’ve seen your ad on Facebook, so they might buy it and be like, “Oh, did I purchase from a legit company?” So by emailing them after they purchase and say, “Hey, thanks for purchasing with us, you’re doing a great thing. We’re supporting X, Y, and Z charity,” that really reassures them that they can trust you and that they’re doing something awesome by buying from you.
Jessica: You’ve mentioned the email a couple of times now. Mike, you just talked about emailing people post-purchase, you had talked about emailing people with tracking numbers and email is something that’s a bit of an afterthought for dropshippers, because… Facebook ads are the money-maker. Right?
Yuliya: That was only the case for us in the beginning, we were making a ton of money off Facebook ads, so we’re like, “If it ain’t broke, don’t fix it.” And we didn’t focus on email at all.
Mike: And then it broke. So we needed to fix it. No, that’s a big thing. There are a lot of periods of instability with Facebook ads, a lot… Things don’t always stay scalable for long periods of time, so there are ups and downs on that, but, email, since we’ve really worked on our email campaigns, they’ve stayed extremely consistent. For our dropshipping stores, we’ve gotten our email sales to be 20 percent of our total revenue.
Jessica: Wow. And that’s free. That’s zero ad cost.
Mike: Yeah, there’s no ad cost on that, there’s no customer acquisition cost. We’ve seen about 7 percent of that comes from campaigns where we just send sales emails out or other emails out to our customers, but most of the money we’ve made in email is automated flows. Talking about welcome series, when someone signs up for our email list, a series of emails that talks about our charitable causes, talks about why we started our store, talks about great deals that we have. We have abandoned cart email flows reminding people to purchase and incentivizing them with coupons.
Yuliya: What’s our abandoned cart percentage?
Mike: Our abandoned cart percentage with these is up to 10 percent now of all carts are recovered through email.
Jessica: Oh my gosh.
Mike: Yeah. That’s made so much money. That’s the biggest thing I think. And we also do really well with repeat purchases with our post-purchase emails where we remind people of the cause and we suggest other products that they may like based on what they’ve already ordered.
Yuliya: And give them a discount or other incentive to buy again.
Mike: Making people feel like they’re part of the VIP club now and just feeling very nurtured and wanted.
Jessica: When do you get started with email advertising? Is that something where you wanna wait until you’ve got 100 customers to put in the work to set up these flows, or what’s the first step there?
Mike: I would start it immediately. We waited way too long. We realized after… It was the kind of thing where it was great once it started working. But you also kick yourself ’cause you’re like, “Oh there’s… “
Yuliya: So much money.
Mike: So much money that you just left on the table, and you didn’t know about it for the longest time. But I would get that going immediately. When you start a store people like to run ads and it’s all about, “How do I make Facebook ads work?” But if you just get an email from someone, then your Facebook ad has worked, and then you can continue to sell and resell to the same person without paying for it again.
Yuliya: And the great news is, is that you can get started with email marketing right away because great apps like Klaviyo have pre-built flows already there for you like abandoned cart flows, welcome emails, post-purchase upsells, all of these are conversion driven, like don’t fix it if it’s not broken. You can add your own branding touch to it as you go on, but you definitely don’t need to get started right away, just literally install the app and turn on the flows, and you’re making money.
Mike: Put your logo on it.
Yuliya: You’re good to go.
Jessica: So you don’t need a mechanical engineering degree to engineer emails…
Yuliya: Not for that.
Jessica: Alright. This has been really cool. Let’s move on to unusual business idea number four.
4. Ergonomic Baby Carrier
Jessica: Okay. Here we are on product number four, and it is a baby carrier. But you just told me when we will have the best product to sell to mothers of babies, that we weren’t gonna sell it to mothers of babies, we’re gonna sell it to mermaid lovers. So surely, we’re selling this to mothers, right? We’re not selling this to mermaid lovers too.
Yuliya: Yeah. So this is a great example of combining two trending things to create a unique spin on a product that’s already doing well. So, posture correctors have been blowing up on AliExpress over the last year or so, and you can see that via Facebook ads and the trending products on AliExpress.
Jessica: Yuliya, we’re talking about the baby carrier, not a posture corrector.
Yuliya: But this is the ergonomic baby carrier.
Jessica: Oh, you’re not confused.
Yuliya: Posture for mamas.
Jessica: Oh. Okay. I see. So you saw the trending product out there in the ether. Oh yeah. I’ve heard of the posture corrector being really popular too, and you brought that back and remembered it. Did you like just remember it as you were browsing and you saw this baby carrier?
Yuliya: I just saw it, and I was like, “Yeah. This is perfect,” because it’s just a baby carrier, but it’s created in a way that is good for your posture and who has more back pains than new mamas. And the baby niche is just viral, so combining posture and the baby niche would really put you in a great position to have a strong branded store that’s all about the ergonomic baby.
Jessica: One thing I’m worried about is that when I usually host this show, I try to draw out helpful tips that our audience can use when they build their own stores, but it seems like your brain just works in a magical way, connecting different dots in dropshipping trends and products, and I’m not sure how to teach that to our audience. So are there any tips you can give that will help our audience connect those dots as well?
Yuliya: Yeah. So honestly, I just follow influencers from The Bachelor because tons of companies pay them so much money to promote their products. And I know that if they’re paying them that much money to promote a product, they’re probably making a lot of money doing that. And a ton of influencers from The Bachelors, you have all sorts of demographics, you have single women, moms, new moms, and so I see baby carriers as something that is being advertised.
So when I go on AliExpress, I think, “Okay. How can we fit this in and position it in a new way?” So I really just watch trending products on Instagram and YouTube and try to come up with a creative way to sell them.
Jessica: And for those of you who are not from the US, The Bachelor is a reality TV show in which people audition to be the wives and husbands of a single person they’ve never met before. Am I summing it up right?
Yuliya: Yes.
Mike: I think you nailed it.
Yuliya: Trash TV.
Jessica: And the influencers are former contestants, basically.
Yuliya: That’s right.
Jessica: That is incredible. That might be the only thing they’re good for.
Mike: They work really well.
Grow Profit Margins With Unusual Business Ideas
Jessica: One thing I wanna talk about that we’ve gotten a lot of comments because… I started this show saying that you guys made $2 million in the past few years. And I know someone is gonna comment and say, “That’s just revenue. What are the profit margins?” So what are your profit margins?
Yuliya: So our profit margins, we’re happy to say, have increased exponentially. They were 4 percent for the first year.
Mike: Yeah.
Yuliya: And now, they’ve shot up to anywhere between 15, 20 percent.
Mike: We do 15 to like… We do 13 to about 21 percent in a given month.
Jessica: I want to talk about revenue because one of the things that this show has gotten some feedback on from our audience is we talk a lot about how much a store made, your store needs $2 million in the past year and a half. But then, we don’t say anything about actual profit, and we’ve had a lot of people ask, “Okay. Well, what’s the profit?”
And just to address the audience, one of the reasons we always talk about revenue is that we, as Oberlo, can confirm revenue numbers. So if a dropshipper says they made something, we confirm that and we know that’s true, but we can’t confirm profit ’cause we don’t have insights into your dashboard. Would you be willing to share your profit margins?
Mike: Yeah. Certainly. Our profit margins have changed wildly as our store has grown. Towards the beginning, especially before we had email marketing really set up, we were… It fluctuated a lot, but we averaged about 4 percent profit, which is not exactly a great number. Regardless of how high your revenue is, you still wanna be able to attain a lot more than 4 percent. But since we’ve got an email marketing going, and really honed in on our ads, we’ve been consistently doing over 15 percent this year, which is great.
And one of the ways we really track that, is we use an app called OrderMetrics, which is super helpful. OrderMetrics will be able to input all of our Shopify revenue, all of our Facebook and Google ads spend, all in one in real time, as well as any other expenses that we wanna put in there like the expenses on virtual assistance, any Shopify apps or software we put in.
Yuliya: Payroll.
Mike: Yeah. If you’re set up like a business as you should be if you’re doing enough sales, or you should just be a company anyway with this, so payroll, things like that, taxes, all of that, and you can display it all in real-time. This is very helpful because especially, when things were kind of starting out, if we did like $1000 in revenue a day, we would then go over to Facebook ads and say, “Okay. We spent $500, and I think that amount of products costs us… I don’t know, $300? Okay, so we made 200, but how much did we spend on Shopify fees? How much did we spend a month on all of this software?”
And you realize, your guesses have like a 20 percent to 40 percent kind of range. You either lost 20 percent, or you made 60 percent, so it’s really hard to tell. So something like OrderMetrics has been really great for seeing, in real-time, how you’re profitable and had by how much. And it’s also really been great for us seeing where we’re wasting money, or what products make us more money than others, and it helps with pricing products which has been a big thing. So I definitely recommend an app like that.
Jessica: So OrderMetrics, right?
Mike: Yes.
Jessica: That’s super helpful. While we’re on the topic of finances, take me back to the beginning. A lot of dropshippers wanna know when they’re just starting out, how much should they budget for their first store? So how much did you budget for your first store?
Yuliya: So Mike wasn’t part of it the first month and a half, so I did whatever I wanted, and you can pay with time, or you can pay with money, and I would much prefer pay with money, ’cause I like to know yes or no, and I honestly just spent a lot of money recklessly on Facebook ads. But the cool thing is, once Mike got involved, there was a lot of data that we could analyze, so that we could actually optimize the ads and make a ton of money. But in terms of how much I spent, it’s probably like $5,000.
Mike: Yeh, we spent about $5,000 before we became turned out of the black and into the profit zone. But I would say the… It took about $1,000 of spend before we started churning profit, and then to make up for all of that lost profit was about $5,000. But again, it’s exactly like Yuliya said, if you just… You were getting sales which means we were learning… We were training our Facebook Pixel, we were learning about the customers, we were being able to build lookalike audiences, so a lot of that is extremely valuable.
But if we were to go slower and spend less money, it might… We might have still gotten to the same place, but it would have taken a lot longer. So I think it really depends on what you have more of at the moment, time or money, and kinda treat it that way.
Yuliya: Yeah. Or ignorance. I don’t have either.
Jessica: Thank you so much for being honest about what you spent, because I know that’s a huge mystery to people who are just starting out, so it’s comforting to hear you can start out by spending $5,000 recklessly and end up making 2 million dollars in revenue and traveling around the world while you work.
Yuliya: That’s right.
Mike: Somehow it’s been great.
Jessica: So what's next on the list of unusual business ideas?
Jessica: Say it with confidence. Yeah, that’s the product you recommend.
Mike: That’s exactly what we’re recommending.
Jessica: Why are you… This is ridiculous. Why are you recommending this?
Yuliya: Because this is the perfect product to sell during the holidays. So if you look on Google trends, if you look up puppy and me or matching dog…
Mike: Dog and me.
Scale During the Holidays With Unusual Business Ideas
Jessica: Dog and me, you’ll see that there’s a huge spike during the fourth quarter almost every year. And sometimes, it’s awesome to prepare just for seasonal products, because when the product is seasonal, it can go viral really quickly, so it’s kind of like a nice cash injection, end of the year of Christmas bonus. So you can start in the fall, building your store, building a Facebook page, really building your Pixel, and then go all in and scale for the holidays.
Mike: Yeah. I think it’s a great seasonal one like you said, and I think a big reason is Christmas cards.
Jessica: Oh, that’s brilliant.
Mike: I think a lot of people take Christmas cards… A lot of people don’t have children or their…
Jessica: They have dog children.
Mike: Their dogs are their children like us, and their dogs are the part of the family, and people love matching Christmas cards, so I think if you can get the dog to match the human, there’s a reason why it spikes up in Q4, because people do this, and I think this is a great, great product to sell especially seasonally.
Jessica: Say someone decides to take your advice, because you said, “This is gonna trend in the holidays. We’re publishing this video in the fall,” what else should they sell in their store? Or should they make this like a one-product store?
Yuliya: I would say you should make it a dog niche store and include other products like the water bowl that we talked about, dog toys. Literally, anything in the dog niche, because I would never depend on just one product that you haven’t tested with your audience to make you money two months from now. I think that’s a good supplementary and bonus product, but I wouldn’t depend on a seasonal product to give you consistent income.
So that’s why a niche store is great because it gives you that freedom to have those viral seasonal products, but it also gives you the freedom to have viral every season products as well. So if you would wanna sell this, I would recommend starting some type of niche dog store whether it be a breed-specific or a cause-specific and just start selling products that are good for a year-round now.
Jessica: Say someone follows your advice, starts a dog accessory store, they have this product in there, how do they write product descriptions? Because these can be really hard to talk about other than, “Yeah, it’s a t-shirt for your dog and you, buy one.”
Sell Unusual Business Ideas to Emotions
Mike: Yeah, and I think it’s exactly right. Your product description here should not be focused on functionality or the texture or what it looks like. People can see what it looks like, but what you should really try and be… What you should really try to do with your product description is elicit an emotional response, because this is for people who are… If someone’s gonna buy a product like this that matches their dog, they love their dog, they treat their dog like children, so you’re really trying to tap into that type of emotional response whether you tell a story that they can really relate to about someone and their dog, or you just describe the feeling you get when you put it on.
We’ve done a lot of products where we write poems for them to really empower or make people feel the feeling that you want them to have, and I think that’s been super helpful. So all product descriptions, I would say, don’t focus on length and size and stuff like that. Put those in bullet points afterward, but really just go in on what you want them to feel when they’re using this product.
Jessica: And this goes full circle because it kind of gets back to what you were saying with the dog water bottle about knowing how your audience talks, because if you know how people describe their relationships with their dog, then you can put that language in the product description.
Mike: Yeah, there is so much dog-specific language out there, you would be surprised. And even on that water bottle, there are two sizes, small and large. To use their language, you would call it the pupper and the doggo size.
Jessica: Oh, that’s a good idea.
Mike: Those are all things that they really… They really have an entire lexicon of terms that the outside person might not be familiar with, but a dog lover would recognize these words and these terms and realize that this is my scene, these are my people selling this.
Jessica: They’re speaking my language.
Mike: They’re speaking my language, so that’s definitely the way to go.
Jessica: Yuliya and Mike, your advice has been incredible and the list of unusual business ideas are great! Before I let you go, what is one piece of advice you would give to new dropshippers?
Yuliya: Remember that you are building an ecommerce brand where the fulfillment is done by dropshipping. I think a lot of people think it’s dropshipping first and brand building second, when the complete opposite is true. So study what the big brands are doing like Fashion Nova, Nike. See how they do their email, see how they do their ads and their social media, and how they really create a raving customer base and follow that.
Mike: Yeah, be a customer yourself. All those big brands, sign up for their email list, see how they target you with ads, see how they target you with email, do all of that, study. If it’s good enough for the big brands, it’s certainly good enough for your dropshipping store.
Yuliya: Totally. And just remember, with building a brand, you’re not gonna get rich overnight, but you can get rich forever if you do it right. So put in the time, study, and make this as if you know it’s gonna be, for sure, successful. Don’t cut corners, don’t be messy with it, make it a legit brand from the start.
Jessica: That is so motivating. So how can I get more of Yuliya and Mike? Is there any way people can follow up with you?
