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Phil K | Breaking $100k Drop Shipping on FaceBook Interview Summary
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Hello everyone, today I’ve got Phil with me who’s done well with FaceBook and Dropshipping, thanks for being on the show.
Thanks for having me, good to be here.
Before we dive into the specifics, how did you come across this? What did you do at school, etc?
I went to school for business but I didn’t learn anything about internet marketing there. I stumbled upon it by getting into affiliate marketing. I was looking for ways to make money online.
So I first discovered Affiliate marketing when I was in university. At that time I learned about poker affiliates so I started a little poker affiliate site but at that time I wasn’t consistent. I’d just build and quickly abandon stuff.
So you were promoting leads to poker companies?
Yes, so you’d get a payout if you could get someone to sign up and deposit money into the poker company. I didn’t know much about getting traffic so I didn’t really do well with it.
Did you do anything else into internet marketing related?
Yeh, after university I looked more into it and got interested in SEO at first. This was about 7 years ago. That’s because at the time I didn’t have money to go through paid advertising. I quickly discovered I didn’t like that whole process.
That’s about the same time I got into SEO. I was promoting Air Swimmers which were fish balloon type products that you can control the with a remote controller. There was a video that went viral on Youtube for them.
So I made a blog, a few articles and then for the next 5 days I was just sitting down like a robot, spinning articles, pushing backlinks and I got it to about $3-$4 a day but the whole process put me off SEO completely.
Did you ever get into paid marketing?
After I did SEO and didn’t like the process I came across this blog by Mr.Green. I first learned about paid advertising on his blog. I signed up to StackThatMoney because the stuff that he wrote on his blog was good.
How did you get into drop shipping?
I kind of knew about it but never took it seriously. There’s another guy I follow called Charles Ngo. He promoted another guys ecommerce course and if you’re on his list you’d know he rarely promotes courses.
He was promoting Adrian Morrisions course called ecom success academy. That’s where I learned the whole process of drop shipping.
Was the course worth it?
For me, the course was definitely worth it because it teaches you everything step by step from the beginning. Once you get past that point he has a lot of stuff about advanced marketing like proper targeting and how to structure the business properly.
When did you get into drop shipping?
I just started my drop shipping site just 9 months ago.
Is that the same site you’re running today? Did you start with a niche store or general store?
I followed through the course, he recommends either a niche store or it’s better to start a general store so I can test multiple niches.
It’s better to start general stores over niche because you don’t know if the specific niche you’re in will have profitable products. You can always start a niche store after testing specific products in your general drop shipping store anyway.
Exactly. When you’re first starting you don’t know in which direction your store is going to go so if you have a general store it helps with rapid testing which niche you want.
So what was your research process?
I look through FaceBook and see what other people are running because that’s always a good indicator as what’s working. A good way to start out is to spy on what others are running so you can run your own tests related to that. You can gauge based on the engagement and comments.
I think about 60-70% of my campaigns have come from running similar products that I’ve seen on FaceBook.
Is there any products that you’d recommend to avoid?
If you’re drop shipping from Aliexpress or China and you’re doing clothing you have to make sure you display the size charts clearly because a lot of sizes are what you’d consider ‘asian sizes’ which are much different.
I see a lot of people selling trademark stuff like iron man or superman.
I once promoted an item with content from another seller and FB canceled the ad. The product was doing really well too.
Did you have a lot of account ban issues? I’ve always found if you”re not doing anything dodgy you won’t have any issues.
Yeh for me I’ve found the same but with others who complain they say they’re not doing anything dodgy but you never know.
Any other advertising platform to promote your products?
I’ve only tried FaceBook ads for now but I’m thinking of testing out Instagram Influencer Marketing.
I think most of the influencers only post for a few hours though.
It depends how big the page is. If it’s in the millions they’ll charge you a lot just for a few hours.
Have you done any Instagram or FaceBook influencer marketing?
Yeh I’ve done about 5 shoutouts just for tests for the forum but I first did a test on this page called art.ig which is really cool. I remember her page had around 650k followers just a few months ago but now it’s about 1.2M followers. I think she gets about 15k organic followers a day.
So I did a shoutout for $200 and got about $350 revenue. It’s worth it but only if you get quality traffic.
Actually there was a forum thread just the other day where member ‘awesome’ did a FaceBook shoutout on a 3,000 follower page and generated about $400 worth of revenue. Crazy.
It’s one of those things you have to test.
What’s your Facebook ad objective strategy?
When I first started I boosted the page post with PPE. I then switched it over to website conversions with View Contents and Add to Carts. Then once I build the data with purchases I switch to optimising by purchases.
Did you find tampering with ads that are currently working, did that effect the ad performance?
For me I would duplicate the ad and change that. I did try changing things with the working ad sets but it did drop the ROI.
What do you find makes the biggest difference in the process? What do you find people should be applying the 80-20 rule to?
Rather than focusing on the general layout, most of the focus should be on finding the product, product images and also audience targeting.
Did that take you a while to get right?
Yeh, it was a lot of trial and error.
Let’s talk about interest targeting for now. I’ve always just used magazines, forums, websites, and other targets directly related to the niche. But I’ve seen others add flex targeting. Is that something you do?
I’ve tried that a little bit but didn’t find much success. I had success when I did precise keyword targeting. So you had to look for more fanpage related targeting. Like Magazines and Websites, etc.
For me Interest targeting is pretty simple because in FaceBook ads manager you can just put one interest and FB will autosuggest more interests related to it.
Yeh, it works pretty well, you just need to find one and FB will help you add more and more.
The other part of the process is finding the right product. Is that just a trial and error kind of thing?
You can’t really tell what’s going to sell well. Sometimes you think an item will really sell well but it doesn’t and other times you think this item won’t sell but it does. It’s more of just a testing thing so you have to test it and get the data rather than making your own opinion.
I think there comes a time when you just submit FaceBook data. You don’t think too much, you just throw it on FaceBook and see if it works.
Do you find the product your selling has always been catchy or have you been able to sell products that are simple?
The products that have worked for me have always had something catchy to it. One strategy that worked well for a lot of people are those infomercial type products like kitchen knives and sushi bazooka.
On Aliexpress there’s a lot of products like that so it helps to find a youtube video for them.
One thing I have issues with is targeting due to the item being really broad.
For targeting, you’d have to start as specific as you can. One product I had success with was hot shaper pants. It’s something you wear and sweat to lose weight.
So how did you target that?
I target two different groups. One was fitness groups and the other was weight loss. Once the campaign builds you can go broader since you have more data.
Photo ads or Video ads, which have worked the best for you?
If you’re doing FaceBook video ads the CPM can be a lot lower so you’ll get more traffic.
The video ads help showcase the product better which helps the product sell.
What do you think is the most important piece of data?
The CTR, how many people are clicking on the links. Not just on the ad but the actual links to go to your ad.
The Cost per Click and make sure the cost is between a certain range.
What’s that range been for you. For me it’s been around 5-25 cents.
For me, I haven’t had a specific range. Sometimes I’ve had success with 50 cents, all the way up to a dollar. Some campaigns I’ve still been profitable.
I’ve always found products over 50 cents per click may convert but they’re stuck either being slightly profitable or mostly break even. More of a headache campaign.
Mostly that’s true but you shouldn’t discount it too often.
Let’s talk about the spend. What’s your process. Do you run it for $5 a day for a few days?
I start off at $5 per day per ad set. When I do a product launch, I may have one ad with 2-3 different ad sets that might have different targets. Then I run it for 2-3 days and then I run it and start cutting stuff out based on if it’s losing.
Auto bidding or manual bidding?
I’ve heard a lot about manual bidding but I’ve only tried auto bidding for now.
I was talking to Harrison the other day and he was mentioning you can set your parameters so that you’re only paying $5 per add to cart so FB will try and find you traffic that will get you this metric.
What do you think one of the biggest thing people are doing wrong? Is it a mental thing?
I think you can train yourself to be more business minded. I’ve learnt over the years with anything business related not just drop shipping that it’s more of a mental game than anything else.
I used to not have such a great mentality which is why I didn’t have much success. Mainly you have to get yourself to think differently.
A lot of things people are doing wrong are not having enough patience. They want immediate results instead of learning everything from the ground up.
A lot of people just start out trying to get to a certain number in a specific time instead of just being focussed on learning the whole process and seeing what you can do step by step rather than trying to make a whole bunch of money really quick.
I’ve found setting your goals the other way around can work. Eg, for podcasting I try aim for action so launching 50 podcasts and then seeing what happens.
That’s a good way to look at it. Before I had a different mentality of hitting the numbers but I realised over time I lose that drive and hunger so like you said it’s better to focus on the specific action and do that consistently for the next 6 months or so.
That’s a really good mentality especially for drop shipping. Just aim for launching 100 products instead of wanting to hit a certain money target and ending up being discouraged.
It’s one of those things that comes with a lot of failure but you just need that one success that will change everything.
Do you have a formula you use to add margin to the product?
For me I don’t have a specific formula, I just look for something that has a decent mark up without people saying it’s too expensive. Usually it’s around 3-4x original cost. Sometimes it just works out to be 2x my original product cost.
Is there a range you work in for you products?
For me right now I focus on around $20-$30 products. I haven’t done much higher ticket items. When I first started I tried the free + shipping model which was about $10.
Did you have much success with the Free + shipping model?
I had some but not a lot. Sometimes if you have too many variables people will just add multiple products.
Is there any Shopify Apps that work well for you?
I installed the pop up notification app but many people were saying other drop shippers were figuring out your campaigns so I removed it.
I still see sites that use that and the notification pops quite often.
There’s one that’s called abandonment protector. It helps because it’s normal to have a high rate of abandonments. So what I did was I set up a 3 step email so if they abandon the cart it would automatically send them 3 emails and try and recover the sale.
What was the frequency of those emails?
The first one was within an hour, the second is within the next 5 hours, the third one is the next day. So you have to get them while they’re still in buying mode.
Did you use any upsell apps?
I used incartupsell. That one, instead of it popping up on the product page, it pops up once they add the product to the cart and when they go to checkout, you can have an upsell that pops up there.
That’s really good because people are just about to checkout.
With your upsel app did you pick products that were also selling really well and were really catchy?
If it’s something very related to what you’re selling it can work.
What do you find people doing wrong at the start?
I’d say they don’t test enough products. They don’t work on their targeting as much and just test things that are already really popular and they don’t test as much as they could have.
I know people pick products that are selling really well and try and market the exact same thing to the exact same audience which doesn’t work.
The thing with FaceBook is if you market the same product to the audience someone else has already marketed that product to those same people have already seen the ad and decided whether they want the product or not. They’re seeing the ad for the third or fourth time so they’d engage way less with the ad.
Exactly and since it’s drop shipping, there’s very low barrier for entry so you’ll see a lot of people promoting the same products of what was promoted months ago.
I think it’s just part of the journey. I know many people start promoting the same products I started with. You just need to push through the first 2-50 products so you can find your own specific area.
What’s your current and future plans? Are you going to stick to drop shipping or grow your own brand?
The main issue with aliexpress is the shipping times so I’d say I am looking for more branding the store and trying to look for better suppliers where shipping would be better and less issues with customs, etc.
Do you feel drop shipping is going to be here for a long time or is the Aliexpress model risky?
I feel drop shipping will be here for a while but Aliexpress drop shipping will keep changing. Since there’s so many people doing it there’s so many issues with delivery times, etc.
For newbies, how much money should they get started with? Is there a number you can have in the bank which is comfortable for you to go out testing?
For FaceBook advertising & drop shipping you need to have a budget or it’s very tough to make it work. I think a good range to start with is about $1,000 to $2,000.
You’ve got to be smart with your spending as well. Sometimes people will spend $1,000 and when I ask them how many products they tested, they’d just say around 5. They’d just have one product they spend $400 trying to get it to convert.
Do follow a more of a rapid testing method. Like a $5 a day, max test it for about 3 days and move on if the product isn’t making sales.
So you would say the product is the most important?
And audience targeting. Sometimes you can have one audience that doesn’t work but when you switch it to a completely different audience it can work.
When you say different audiences are you referring to different categories or just different interests?
Specific interests that you use. Eg, one group that you’ve targeted, but another group you haven’t targeted yet that might work.
It’s interesting how we all do things slightly differently. There’s no real one formula that works for everything.
Yeh, there’s many different ways to go about it. It might not work for someone else but it will work for you.
Any last tips, resources that have helped you?
Ecomuniverse has been a great resource, I see a lot of great information on there. I’d say go on youtube, launch product after product, do your research to see what’s selling, go on eBay, Amazon, see what’s selling even on FaceBook.
Just do some searches like ‘free shipping’ ‘50% off’, etc as people usually use those keywords.
Do you use any spy tools?
It used to be called shopified but now it’s called intelligence. It works well if you want to know what products they have on their store that are selling well. You can do product research using that.
Alright Phil, I think we’ll end it there. Thanks for being on the show.
Thanks Mateen for having me.