[MUSIC PLAYING] Once we have our idea, whether it's knowing exactly what product we're going to sell or knowing exactly what niche we're going to target, it's time to evaluate our idea. So we want to ensure it's a viable business idea for dropshipping before we run a test. To do this, we're going to first measure demand, then we're going to measure the competition. And lastly, we're going to analyze the product idea.
Now before anything else, we want to confirm that the product or type of products we want to sell can even be dropshipped. If our product is very niched, there may not be any suppliers that offer dropshipping. In most cases though, you'll find a supplier to dropship virtually anything. Still, a quick Google search will confirm that for us. So I might quickly Google "matcha tea dropshipper" just to see what comes up.
I'm not going to dive into these results just yet. I'm just seeing if it's even possible. Now that I know it is possible to find a dropshipping supplier for matcha tea, I'm going to start off with measuring demand for my product idea. There are a lot of ways to measure demand for a product. But for the purposes of this store we're starting, we're going to use basic tools to give us a general idea of demand.
Since dropshipping will allow us to quickly test ideas, we don't want to overanalyze our idea. We just want to quickly validate, and then move on to testing. OK, so here we can see a steady rise in searches around matcha tea according to Google Trends. Next, I want to see how this product or niche is talked about on social media. So I might use Twitter to search matcha tea just to see how people talk about the product.
I will do the same on Facebook and Instagram. I want to see people passionately talk about the product or industry and share their thoughts and photos. That's the kind of audience I love to target with products since they're the best kind of customers. The next thing I would suggest doing is trying to identify the top competitors for your product or target customer. This will give us a better sense of the landscape.
I want to keep in mind that competition should encourage you, not discourage you. You'll see why later. So first, open up a notepad or document and begin to list the top competitors. For myself, I might search "buy matcha tea" into Google and see what comes up and even click on the top ads. From here, I can scope out the competition. I can use alexa.com on the top competitors to see what their traffic is like.
SimilarWeb is another great tool to measure demand based on guesses on data from competitors. It shows me the traffic of my competition, as well the sources of traffic. This is great to not only validate my product but also give me ideas when it comes to marketing my product later. So the last check on my competitors I would do is social proof. So are there a lot of people sharing these stores and engaging with these brands on social media?
If so, it might be another indicator of demand. The more passionate and engaged people are on social media, the more confident I will be that I can create the same kind of result with my store and my products. BuzzSumo will tell me the pages with the most shares of my competitor stores. And looking at their Facebook pages and Twitter profiles lets me see their engagement. I might also look up the domain on a lookup service, such as who.is, to get an idea of how old the store is.
It's not perfect, but the date the domain was registered is a good guess at how old a store is. Typically, if I see a newer competitor with a lot of traffic and social proof, I know they've done a great job at growing fast and tapping into our shared target customer. Now remember, competition is a good thing. I'd much rather go into a competitive market than a dead one.
If there's competition, it means people are making money. Nobody wants to go into business and stays in business if they're not making money. So my assumption is that most of the matcha stores are doing well. Important questions. At this point, we should either be encouraged by what we see or discouraged. This isn't scientific. And if we're encouraged, it doesn't guarantee our product will work for us.
Testing is what inevitably will prove what we're doing works. That's why I love dropshipping. Now before we test, there's one more thing we can do. We can answer a few important questions. They'll help us evaluate our product and idea before committing to a test. Now before we test, there's one more thing we can do. We can answer a few important questions that will help us evaluate our product and idea further before committing it to a test.
So for dropshipping, here are some things we should think about. Is or are the products small and easy to ship? Smaller products will mean smaller shipping costs. Are there a lot of accessories and the potential to cross-sell with other products? Accessories that customers can purchase in addition to our core offer can increase our average order value, which we'll talk about later. Does the product have low turnover?
Or does it change constantly? If it does, it will require more maintenance and communication between you and your supplier. Is the product hard to find locally? If yes, this makes the product a stronger offer. Of course, there's other questions such as, who's your target customer? What does it make a potential? It's good to have a general idea of these answers now, but we'll answer these together later when we begin testing our product and working to get our first sale.