Dropshipping & Print on Demand
I have included the dropshipping strategy in the eCommerce learning chapter and this article is to summarise the key points of discussion. "Dropshipping is an order fulfilment method where a store does not keep the products it sells in stock" (Shopify, 2022) It is different from Affiliate Marketing where you need to look into pricing strategy in dropshipping whereas being an affiliate, you will sell the products based on the given price and earn from the commission set.
Image: The overview of Dropshipping, Affiliate and Print on Demand
As the business/brand owner (Seller), we apply dropshipping strategy to find new products to sell at a relatively lower capital of investment and we use the Affiliate Marketing strategy to recruit more sales agents with the goal of higher sales conversion.
You may refer to the published article from Oberlo (2019) for a better understanding between 'Dropshipping' and 'Affiliate Marketing'.
If you don't have your own eCommerce site (brand.com), you can either manually obtain all the product details (Product images, videos, features and specifications) and upload them to your sales distribution channels such as the digital marketplace and social media platform. Once you receive an order from the customer, you will have to manually place the order from the supplier so that they can fulfil the order directly to the customer.
Print on Demand (POD) is a type of dropshipping but you need to involve in the product design stage. You can also choose to create your eCommerce store with the POD platform and connect to your custom domain. However, you may not be able to access the full site data such as customer contact and online behaviour with this approach. You don't need to look into a payment gateway application if you set up a store on the POD platform but you may need to pay for a listing fee or plan subscription in order to enjoy a lower product cost depending on the chosen POD platform. Take a look at the published article from Shopify (2022) on the '10 Best Print on Demand Companies'.
Image: Comparison between Dropshipping & Print on Demand
In the scenario where you have your own eCommerce site, you can look into dropshipping/ POD app/ plugin that allows you to syncronise the product listing and sales ordering for easy store management. With the synchronisation feature, you don't need to manually manage the product details on your site and customer order from your site will be reflected automatically in the chosen app/ plugin for supplier's fulfilment.
Although you don't have to commit to the initial stock purchase, which makes it easier for you to start selling online. But you also have less control over the product quality and fulfilment service, which may reduce your brand credibility to the customers in the long run. Brand identity can be enhanced if you have your own product packaging and shipping labels, as well as full control of customer data for better relationship building using Email Marketing.
Article written & published on 11 May 2022 by Ciayi Lim
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