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Why is selling digital products better than drop shipping?
Borderless commerce, daily paydays, zero stock, 100% automatic fulfilment and negligible customer contact - the many benefits of selling digital products online.
What is drop shipping?
Drop shipping is a clever retail fulfilment method whereby you can sell physical goods which you don’t yet own. A customer basically pre-orders an item (usually without knowing, thinking you have the stock) and you make the order with a supplier on order in a country like China where the goods are made. They then pack and ship to your customer on your behalf.
It’s a bit like someone paying you $10 to buy an item from the corner shop, you going down there to buy it for $6 and you keep the $4 profit. Only drop shipping is on a much grander scale.
What is the difference between drop shipping and Startup Streams digital product stores?
The difference between a drop shipping store and all Startup Streams stores is that all of our ready-to-grow businesses sell digital products, meaning that they have many advantages over the drop shipping market. The main advantages that you should be made aware of are…
1. No need to fulfil orders selling digital products
When you make any sales on your dropshipping business, you will need to process the order with your third party manufacturer every time you make a sale. But with our stores, you don’t need to fulfil any order when making a sale. The product will be sent 100% automatically to your customer and they just need to download it to their device - that is called instant gratification.
2. No inventory to manage, unlike dropshipping
With digital products, you’ll never run out of stock whereas dropshipping stock does. Can you imagine if your third party has missed updating the inventory? It could be a real problem when it comes to the order that you have already taken payment for! This will never happen with digital products, such as the ebooks to sell, included with our stores as you have invite copies of each to sell.
3. No delivery or fulfilment needed with selling digital products
Digital products don’t need any delivery as the buyer simply downloads through a link that you provide for them. This is done automatically with all Startup Streams stores and it means it is a hassle free form of delivery, without cost and makes the buyer satisfied as they are not having to wait a long time for the products to arrive - it is all automatic and instant.
4. No refunds for damaged products to manage with selling digital products
The worst thing to happen with drop shipping is when a customer's product is damaged during the delivery process. Another common complaint is the lack of quality control from the third party and the customer will complain and merit a refund (doubly so if they have had to wait 30 days to receive it from China in the first place). Digital products don’t get damaged, nor take any time to arrive.
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5. No product tracking or related customer service issues, saving time and money.
With digital products, there are no hassles coming from the customer asking “Why hasn’t my product arrived yet?”. You don’t need to track anything across the world nor deal with international borders or taxes. Digital products are instantly sent to anyone with an internet connection anywhere in the world at the click of a button.
6. No generic Ali-Express copy and paste product photos and product descriptions
Let’s put ourselves in the shoes of a customer: How would you feel if you see a poorly written product description which has been copied and pasted from Ali-Express? You would think that this seller isn’t enthusiastic about what they are selling, probably doesn’t even know what they are selling and you’d probably think it is a scam, right? With our stores, we put effort into constructing websites around stories and flow to encourage the customer to read on. We provide short or long product descriptions to aid the potential buyer with relevant information, whilst building rapport at the same time. Product descriptions sell!
7. Selling digital products online isn’t a saturated market vs popular drop shipping products
The competition for selling products on Startup Streams stores is far less than the competition of those selling popular products from a third party dropshipping supplier such as on Ali-Express. We find that entrepreneurs who buy our Startup Streams stores do so with specific digital marketing skills in mind. This means that there are rarely two Startup Streams stores using the exact digital marketing strategies. You may find that because of the competition of selling popular dropshipping products that there would be many other digital marketers using the same tactics for the same products, increasing the competition to sell the same items.
8. Higher average profit margins: Up to 100% profit per sale
Startup Streams’s digital product stores allow you to put in a one-time investment into a website with a product(s) to sell, and you can sell said product hundreds, if not thousands of times. Each time you do after purchasing the store, you can keep all profits from the sale. This is far better than drop shipping as you’d need to spend the majority of your revenue on paying for stock. With digital products, you have all 100% of the product’s revenue to dive into with your marketing costs in order to make a profitable sale. This makes selling digital products more flexible in marketing and more versatile vs dropshipping products, which can have between 50% - 2% profit margins depending on a product's competitiveness.
All Startup Streams stores come with digital products
As we’ve explored, drop shipping isn’t a perfect stress-free way to build a successful online business. We know that hard work is always required to start any business but we believe that our Startup Streams stores are more efficient to manage than a drop shipping store giving you an advantage to increase your success in online ecommerce…
See all Startup Streams stores here