Getting into dropshipping and picking a niche can be incredibly overwhelming at first, especially if it’s your first online business. When you’re just getting started, you might catch yourself looking at niche lists online and copying them for your own stores.
We’re going to save you a lot of trouble with this advice: don’t do it. Resist all temptation and don’t copy that niche list.
In this post, our goal is to discuss why you should ignore high-ticket dropshipping niche lists. Of course, we’re also going to tell you what you should be doing instead.
Let’s get started.
Why You Should Ignore High Ticket Dropshipping Niche Lists
Why should you ignore high-ticket dropshipping niche lists? They make things easier, don’t they?
Sadly, that just isn’t the case. Sticking strictly to the ideas on these lists could end up making things way harder for you in the long run.
We’ve called these high-ticket dropshipping niche lists “crumbs from the table” in the past. That imagery beautifully sums up why you should ignore these lists: because they’re just scraps.
The niches on these lists have been circulated and exposed already, giving competitors plenty of time to fill them.
That doesn’t mean it’s impossible for you to have success in any of these niches. You could potentially even use them for inspiration.
But imagine that they’re well-known mines that have been worked already. You’d have to dig deeper and farther than anyone has before in order to find your gold.
That means you’ll have to have a greater level of expertise than your average “miner” in order to zero in on what your competitors missed.
You’ll need to have a great ad campaign. You’ll also need to have a good system for when someone is searching for something generic so that they can still find you.
You may even need to be prepared to take a loss simply to get that customer in your door. This is especially true with low-ticket items.
Take pencils, for example. Yes, if you search for pencils online, you’ll see that people are actually paying to advertise them to you.
They’re not hoping to make money off each pencil, though – they’re hoping to just get you in the digital front door of their store.
What do we recommend doing instead of using a niche list?
We suggest looking at it from a different angle: instead of just seeing a niche, look at it as a vertical and then find product types within that vertical.
One thing some people do instead of starting completely from scratch every time is buy established Shopify stores. We actually did a case study on if buying a Shopify store is worth it.
What is a Vertical?
Let’s explain to you what a vertical is before we go on.
The best way to explain it to you is to compare it to a niche. You can think of a niche as a specific twig on the branch of a tree, connected by that branch to a broader topic.
The vertical, then, is that broader topic that twig is connected to, or the “trunk” of that tree.
Let’s look at restaurants as a vertical, for instance. That’s our broad topic, and we can go from there by defining what a restaurant needs to operate, or what “branches” come off of its trunk.
It’s important to mention, though, that this is less about what it absolutely needs (its essentials), and more about what the restaurant may have. In other words, you’re looking for the specialty items that a high-end restaurant would have, as opposed to basics like plain utensils.
For a more beginner-friendly introduction to the concept of verticals, we recommend looking at sites like Hayneedle and browsing around. You’ll see that they have a clear focus (home décor) that branches into different items related to that topic.
Want some more detailed guidelines on picking a niche? Check out our favorite high ticket dropshipping niches.
Beating the Competition
We’ve established that you should be looking for your own vertical, instead of picking from a used-up niche list. But we’re going to need to dig a little deeper here to show you exactly why this is so important.
We examined this concept once with a student, who was looking at products you could find at Home Depot. They were worried the product they picked was too generic.
We told them that yes, by itself, it was too generic.
So how do you pull away from that? How do you make your vertical stand apart?
You start looking at things enthusiasts for that item might want.
Look at gaming PCs, for example. A dedicated PC gamer isn’t going to get a generic PC from Wal-Mart.
They’re going to look for more high-end and specific things. It’s possible they’ll even look for the components to build it themselves.
As your products get more expensive, your competition decreases, too, because you’re eliminating the commodity buyers who just want the cheapest things they can get. At that point, you’re marketing to people who are willing to spend outside the market value simply because they enjoy collecting your chosen product.
The problem with basic commodities is that you’ll be competing with dozens of other big-name competitors, like Wal-Mart, Home Depot, or Wayfair. If you can be the specialty store that has a great website and customer service, then you will draw in customers.
This is because the customer base for these specialty items is smaller. Big names won’t have an interest in competing for them.
Our rule of thumb is to avoid selling things that are stocked in stores at big chains like Home Depot. If they’re listed just on their sites, it’s not such a big deal, because suppliers themselves can list things on those sites.
A basic niche list won’t give you the insight to choose something wisely. However, you can take that niche list and look for things that are specialties within any given niche on it.
You could even look into niches that are similar or related instead.
Okay, let’s sum it up: don’t use niche lists to find products for your dropshipping business. You should be looking for specific product types people are searching for, and these product types should not be commodities. Use the concepts we laid out in this post to help you branch out.
When you find these specific non-commodity items, you’ll be able to advertise with less competition and a higher profit margin. You also will have cheaper ad spend, because your ads won’t be drowned out by all your competitors.
Curious about which kinds of advertising work best? Click here for our findings on why influencer marketing for Shopify dropshipping doesn’t work, and what you can do instead.
We can also help you with deciding whether you should choose Shopify dropshipping or FBA in our guide: Dropshipping vs FBA.
If you need some extra guidance on choosing your niche, we’ve written an extensive Instant Ecommerce Asset course. However, if you’re not ready to buy the course yet, you can take a look at our free online asset playbook.