In recent years, "dropshipping" has forged its way into the e-commerce space. Dropshipping, if you're unfamiliar with the concept, is the act of selling online without stocking inventory. An example: If you dropship laptop batteries, you sell laptop batteries that are provided by another supplier. You can get orders without having to handle shipping, because you simply plug the customer's information into another site that handles the shipping.
It can be quite the profitable side hustle when done at scale. But that's just it: It's often challenging to do at scale because this "copy and paste" method of transferring information can be tedious.
Dropified founder Chase Bowers recognized this tedious process when he first learned about the dropshipping concept. During a four-week mastermind, he connected with a fellow entrepreneur who had just entered the profitable e-commerce industry and was making strides--profiting $30,000 in just the first 15 days of his online store. But as Bowers watched the process, he knew there had to be an easier way--a way that didn't include all the manual copy and pasting.
"I was already working with a developer out of Morocco, so I discussed it him while I was at the mastermind and asked if it was possible to create a 'one-click' solution that could send customer information from supplier site to his store in a chrome extension," Bowers says. It worked--and everyone at the mastermind loved it. Dropified was born.
From an Idea to a Million Dollar Software
Now, Dropified serves over 50,000 commerce store owners, makes over $5 million a year in revenue, and was just ranked by Inc. as the 55th fastest growing company in the U.S. But when Bowers first developed the software, it was just a side business. "I was doing consulting at the time, so I decided I would focus on Dropified on the side and see what happened," he notes. He continued to consult until it became clear that Dropified was growing fast enough to require his full-time attention. "There's a point when you just know," he chuckles.
As for how Dropified grew so quickly in a relatively short time period, there were a number of strategic decisions that Bowers and his team made. Here are the key takeaways that apply to anyone hoping to start and grow a side business into their full-time job.
1. Harness affiliate marketing to exposure.
If you've just gotten started with your product, it can be challenging to gain the exposure needed to scale your business. A good way to get started with affiliate marketing is to find some affiliate-related conferences or internet marketing conferences.
"If not, you can look for people in your industry who are already established and reach out to them to see if they would be interested in earning money by referring customers," Bowers adds. To make it easy, there are some affiliate platforms online, such as JVZoo.com, that list the product and how much the affiliates would earn in commission. Affiliates can opt into marketing your product if they're interested, so it's fairly hands-off for the company.
Bowers also engaged newsletters with large subscriber bases to spread the word, and offered deals and discounts to increase his conversion rates.
2. Find creative ways to make money in the beginning.
Bowers stresses that taking the time to learn and grow organically is key. "Find creative ways to earn revenue right out of the gate," he says. Dropified was profitable from the first month whereas some businesses go months--even years--without making any money.
Bower's creative, revenue-making idea? Pre-selling a VIP license. "While we originally gave away the Lite version, which could only connect one store and display a limited number of products, we also sold the lifetime 'VIP license,' which was essentially the [future] unlimited version of our current software," he says. They sold it for $300 to just 50 people, based on the premise that future customers would be paying thousands for the same product down the road. And it worked. It sold out once he introduced it, then the next weekend it sold out again in just one or two days.
"It was 100 users at $300 each, which means we quickly made $30,000," Bowers notes. And what's better, they now had a community base of Dropified users they could talk to and learn from as they continued to iterate on the program.
3. Don't quit your main job too soon.
Bowers notes that when people are building side businesses, that usually implies that they have some existing form of cash flow. He recommends keeping this cash flow going for as long as possible to avoid cutting corners or stretching yourself. "Take the time that's needed to learn your industry and what you don't know," he recommends. "Sometimes it just takes time to build a product."
Staying true to his belief that there's a creative way to do things, he also recommends exploring or negotiating ways to have more time to work on your side business without burning yourself out. For example, you could stick to the tasks of your regular job but become a contractor to other companies, so you limit the number of days per week and get paid a higher hourly rate.
4. Set yourself up for success by putting yourself around other entrepreneurs.
Bowers suspects that Dropified would not be a reality today had he not attended the mastermind group where he learned about dropshipping. So, whether it's a mastermind, a networking group, or a big conference, get out there and talk to people. He recommends researching authority figures or gurus trained in your industry of interest, then investigating the events and happenings they attend.
Side businesses are a great way to start pursuing an idea that excites you, and to see where it goes from there in a "non-pressure" vacuum. There are many ways to grow and scale--not just for your business, but for you as an entrepreneur! Founders like Chase Bowers are learning as they go, too.