![\"how](\"https://cdn.shopify.com/s/files/1/0070/7032/files/how-dropshipping-works_8fa59e00-ad6b-4dce-8b34-4680ce0483da.png?format=webp&v=1684938502\")
If you’ve thought about starting an ecommerce store, you’ve heard of dropshipping. It’s a streamlined approach to order fulfillment where you don’t own or ship any inventory.
\nGone are the days where retailers have to lease warehouse space, juggle supply chains, and manage inventory. Whether you’re an ambitious newcomer or ecommerce veteran, understanding and using dropshipping could be the key to taking your online store to the next level.
\nAhead, you’ll learn everything there is to know about dropshipping, from how it works to benefits, and how to start your own dropshipping business today.
\nTable of Contents
\nDropshipping is an order fulfillment method where a business doesn’t keep the products it sells in stock. Instead, the seller purchases inventory as needed from a third party—usually a wholesaler or manufacturer—to fulfill orders.
\nThe biggest difference between dropshipping and the standard retail model is that the selling merchant doesn’t stock or own inventory—they act as the middleman.
\n\nA dropshipper is a person or business that uses the dropshipping model of buying inventory and fulfillment logistics from a third party, instead of warehousing and shipping the products themselves.
\nBecause dropshipping relies on a third-party supplier to handle inventory warehousing and order fulfillment, a dropshipping operation may be managed by dozens of employees or a single business owner.
\nThe dropshipping process is essentially a relationship between a customer-facing store and a supplier.
\nThere are two common approaches to adopting a dropshipping business model. The first is to seek out one or more wholesale suppliers located in North America (or anywhere else in the world) on your own using a supplier database. Examples of popular online supplier databases include AliExpress, SaleHoo, and Worldwide Brands.
\nIf you’re not interested in finding suppliers for all of the products you plan to sell, you can use an app that connects you and your store to thousands of suppliers. For this, use DSers, a Shopify app that helps independent business owners find products to sell.
\nWith DSers, you can browse AliExpress and import the products that pique your interest directly to DSers—which is connected to your Shopify store—with the click of a button. Once a customer buys a product, you’ll be able to fulfill their order in the DSers app.
\nFortunately, DSers automates most of the dropshipping process. As the store owner, all you have to do is check that the details are correct and click the order button. The product is then shipped directly from the AliExpress supplier to the customer—wherever in the world they may be.
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Dropshipping is often seen as a no-hassle, get-rich-quick scheme. But it’s not. Just like any other ecommerce website, it takes dedication to get your startup running and successful. Done well, dropshipping companies can become reliable and convenient partners to growing ecommerce businesses to expedite order and fulfillment processing.
\nHere are a few other reasons why dropshipping is such a popular ecommerce business model for both large and small businesses.
\nProbably the biggest advantage to dropshipping is that it’s possible to launch an ecommerce store without having to invest thousands of dollars in inventory. Traditionally, a brick-and-mortar or ecommerce retailer has to tie up huge amounts of capital purchasing inventory.
\nWith the dropshipping model, you don’t have to purchase a product unless you’ve already made the sale and have been paid by the customer. Without significant upfront inventory investments, it’s possible to start dropshipping and become successful with very little money.
\nAdditionally, because you’re not committed to selling through any inventory purchased upfront, like in other business models, there’s less risk involved in starting a dropshipping store.
\nRunning an ecommerce business is much easier when you don’t have to deal with physical products. With dropshipping, you don’t have to worry about:
\nBecause you don’t have to deal with purchasing inventory or managing fulfillment centers, your overhead expenses are quite low. In fact, many successful dropshipping stores are run as home-based businesses, requiring little more than a laptop and a few recurring expenses to operate.
\nAs you grow, these costs will likely increase, but will still be low compared to those of traditional brick-and-mortar businesses.
\nWith dropshipping, a successful business can be run from just about anywhere with an internet connection. As long as you can communicate with suppliers and provide timely service and support that meets customer expectations, you can run and manage your business.
\nSince you don’t have to pre-purchase the items you sell, you can offer an array of trending products to your potential customers. Plus, you can rotate or change your dropshipping products list without having to worry about unsold inventory. If suppliers stock an item, you can list it for sale on your online store at no additional cost.
\nDropshipping is a useful fulfillment model for both launching a new store and for business owners looking to test the appetite customers have for additional product categories, e.g., accessories or wholly new product lines. The main benefit of dropshipping is, again, the ability to list and potentially sell products before committing to buying a large amount of inventory.
\nWith a traditional retail business, if you receive three times the number of orders, you’ll usually need to do three times as much work. By leveraging dropshipping suppliers, most of the work to process additional orders will be done by the suppliers, allowing you to expand with fewer growing pains and less incremental work.
\nSales growth will always bring additional work—especially related to customer support—but businesses that utilize dropshipping scale particularly well relative to traditional ecommerce businesses. You can dropship on many platforms too, like Amazon, eBay, and Etsy.
\nAll the benefits we mentioned make dropshipping a very attractive model for anyone getting started with an online store, or for those looking to expand their existing product offerings.
\nBut like all approaches, dropshipping has its downsides, too. Generally speaking, convenience and flexibility come at a higher price.
\nHere are a few shortcomings to think about when considering a dropshipping business.
\nLow margins are the biggest disadvantage to operating in a highly competitive dropshipping vertical. Because it’s so easy to get started, and because the overhead costs are so minimal, many competing businesses will set up a dropshipping store and sell items at rock-bottom prices in an attempt to grow revenue. Since they’ve invested so little in getting the business started, they can afford to operate on minuscule margins.
\nTypically, these sellers will have low-quality websites and poor (if any) customer service, which can help you differentiate your dropshipping business. But that won’t stop customers from comparing their prices to yours. This increase in competition will quickly hurt the potential profit margin in a niche. If you’re concerned about your margins you can quickly calculate it with Shopify’s profit margin calculator.
\nFortunately, you can do a lot to mitigate this problem by choosing the right products and selecting a niche/vertical that’s well suited for dropshipping.
\nIf you stock all your own products, it’s relatively simple to keep track of which items are in and out of stock. But when you’re sourcing from multiple warehouses, which are also fulfilling orders for other merchants, inventory can change on a daily basis.
\nFortunately, these days, there are a handful of apps that let you sync with suppliers. So dropshippers can “pass along” customer orders to a dropshipping supplier with a click or two and should be able to see in real time how much inventory the supplier has.
\nDSers also lets merchants take automated actions when a supplier’s stock hits zero. For example, when a product is no longer available, you can automatically unpublish the product, or keep it published but automatically set the quantity to zero.
\nIf you work with multiple suppliers—as most dropshippers do—the products on your online store will be sourced through a number of different dropshippers. This means you have no control over the supply chain.
\nLet’s say a customer places an order for three items, all of which are available only from separate suppliers. You’ll incur three separate shipping costs for sending each item to the customer, but it’s probably not wise to pass this charge along to the customer. And even when it does make sense to include these charges, automating these drop shipment calculations can be difficult.
\nHave you ever been blamed for something that wasn’t your fault but had to accept responsibility for anyway?
\nEven the best dropshipping suppliers make mistakes fulfilling orders—mistakes for which you have to take responsibility and apologize. In addition, mediocre and low-quality suppliers will harm the customer experience via missing items, botched drop shipments, and packing or product quality issues, which can damage your business’s reputation<.
\nUnlike custom-made products or print on demand, dropshipping doesn’t give you a lot of control over the product itself. Usually, the product dropshipped is designed and branded by the supplier.
\nSome dropshipping suppliers can accommodate your business’s product changes. Even then, however, the supplier has the most control over the product itself. Any changes or additions to the product usually require a minimum order quantity to make it viable and affordable for the manufacturer.
\nWhether you’re interested in finding a side hustle, starting a new full-time enterprise, or changing the business model behind your existing online store, dropshipping may be the answer you’re looking for.
\nGetting started with an ecommerce platform like Shopify is easy:
\nYes, dropshipping comes with a number of built-in complexities you’ll need to address as an entrepreneur. But with careful planning and consideration, you can anticipate and resolve those issues to create a thriving, profitable dropshipping business
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Bringing to your attention a beautiful, fully customizable, and modern premium Shopify Theme. Our company has been developing Theme, Storefront, and Shopify apps for over 10 years. We put all of our knowledge, research, and innovation from the eCommerce world into this beautiful, fast, mobile-first Theme and named it Gain. It’s not just a name, it’s what our Theme Gain was created for. We’ve incorporated all the research into it from the psychology of user behavior, focused specifically on increasing average check value, increasing conversion rates, cross-selling, and up-selling, and conducted hundreds of A and B tests to achieve the best results.
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\n\nBlogs
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\nProduct badges
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\nPromo popups
\nPromo tiles
\nQuick view
\nRecommended products
\nYou might also like
\nStock counter
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\nMega menu media
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\nA user journey is a path taken by someone (a customer) moving toward a goal, such as purchasing your product or getting product support. Along the way, the customer discovers your brand, enters your website, decides to buy (or not), completes the transaction, and comes back for support.
\nUser journey maps help you see that path, so that you can gain a better understanding of your customers’ experience and behaviors. A user journey map cultivates empathy, too, so you can discern which pieces—the website, product support, or customer service—are (and aren’t) working as well as expected.
\nHere’s what else you’ll need to know about mapping user journeys.
\nTable of Contents
\nUser journey mapping visualizes a user’s story as a diagram that charts how the user discovers your brand, clicks through to the initial point of contact, engages with the site, then makes a purchase. You might also map the post-purchase journey of engagement with product support or customer service. It can be a basic text document or spreadsheet, but you’ll want to develop it into a visual timeline that shows journey phases, actions, and touchpoints.
\nTouchpoints on the map can include ads, online stores, newsletters, product pages, apps, shopping carts, FAQs, and more. When customers search your site for product information, post customer reviews, chat with sales associates, or add items to their shopping carts and navigate the checkout process, they are engaging via touchpoints. The map should also describe the user’s thought process and emotional reactions at each high-level stage in the journey.
\nIdeally, the journey flows seamlessly toward the intended goal of a sale. However, when friction or frustration sets in, touchpoints become pain points, which can lead to customer drop off or abandonment of the journey.
\nThe user journey is like a story with a plot, setting, and forward momentum toward a final resolution or goal. The customer is the hero of the story. Key elements common in user journeys are:
\n![\"example](\"https://cdn.shopify.com/s/files/1/0070/7032/files/image2_1a672213-8547-49ab-b2b4-45d632ce4bd0.png?format=webp&v=1683244048\")
Journey mapping can be used to help you better understand your customers’ behaviors—now or in the future. You could also create unique maps for a specialized buyer persona, or see the journey from the business-side perspective (how effectively services are engaging with the customer at each touchpoint). Here are five examples of user journey maps:
\nThe most popular type, a current state journey map is a real-time visualization of a user’s engagement, showing the customer experience as it’s happening on your current website. Current state maps typically identify critical points where the customer experience needs improvement.
\nA future journey map serves as a predictive tool and shows the ideal experience you aspire for your customers to have. You can use this type of journey map to test site changes before they are implemented. If you want to know: Will the customer react positively to these significant changes? Future state maps help you make an educated guess.
\nIf you’ve segmented your customers, you can create individual buyer personas for the different segments and customer journey maps for each. For example, a particular group might struggle at the checkout stage while others sail through easily. Knowing which customer segments need additional guidance can lead to more closed sales.
\nA service blueprint takes a current state map and adds the sales and customer service teams, technologies, policies, and procedures needed to serve the customer at each stage (and touchpoint). The service blueprint gets everyone in the business on the same page, and seeing where their responsibilities impact the customer experience.
\nThe onboarding user journey map emphasizes the steps a customer takes after they make the purchase and start using the product or service. It also describes the customer experience when revisiting the website to learn how to use the product, get product support, and discover new products.
\nWhich type of customer persona will be studied? Define your buyer persona by determining which customer segment you want to target and gathering data from customer feedback, reviews, surveys, and anecdotal evidence of customer experiences. If you’re interested in more than one segment, consider making a map for each.
\nThink through the problem this persona wants to solve. What is the need that is going to lead them to your brand and products, and what are their expectations of your products? Tap into available user research such as customer interviews or product reviews, and envision the motivation that will drive the plotline. What kind of buying experience does this persona expect? How do they define satisfaction? The answers provide a measure of success or failure at each touchpoint.
\nJourneys flow along a timeline as a series of actions taken while the persona moves through each stage. List each action for the high-level stages, then identify touchpoints for each channel that is associated with the action.
\n![\"customer](\"https://cdn.shopify.com/s/files/1/0070/7032/files/image1_cde5185b-7aa7-415d-935f-2669f68c4fc8.png?format=webp&v=1683244037\")
A pain point is a source of negative emotions and, consequently, lost business. Any touchpoint where the user encounters friction or lack of direction, or where an interaction proves confusing, can be a pain point. Examples include frustrating product search results, inadequate product descriptions, long loading times during the checkout process, and difficulty accessing customer service. You can highlight customer pain points on your journey map using bold colors, standout typography, or emojis.
\nAt each high-level stage of the journey, you describe how the user is reacting emotionally based on the persona’s profile and their needs and/or expectations. You can map this using thought bubbles, emojis, and graphs of the emotional trendline. Positive feelings would be “up,” negative vibes “down.”
\nThere are numerous benefits of journey maps, including:
\nUser journeys take a hypothetical yet realistic customer scenario and follow the ups and downs as a customer interacts with your website. By seeing points where friction occurs, you gain a better sense of where site navigation and functionality can be improved.
\nYou could imagine the persona moving through the user journey, then test each touchpoint. Or, you can use customer interviews as a source to identify pain points. Then, highlight them in an updated user journey map and analyze why they are causing problems.
\nIn a sense, the terms user and customer are interchangeable. A customer is a user, and the most common user of your website is a customer. Alternatively, customer journey mapping encompasses every conceivable interaction a customer could have with your business, while the user journey can be viewed more narrowly as the customer’s digital experience—how they engage with your website or app, for example.
\nCustomers are diverse and are likely to change as your business grows. There is no one-size-fits-all user journey. To maintain an effective user journey map, you can periodically review assumptions—maybe monthly or on a quarterly basis—about the user personas you have mapped.
\nDrop-off points occur where a user stops interacting with your website due to mounting friction and pain points, such as difficulty searching for products and obstacles during checkout. A map that charts the emotional trajectory of the user journey can help you identify where drop-offs are likely to occur.
\nhttps://www.shopify.com/blog/mapping-user-journeys
\nMany ecommerce businesses start out with little to spend on marketing. That’s why they’re increasingly turning to an influencer marketing strategy. Brand partnerships for influencers is an affordable, effective, and precise way for ecommerce businesses to grow their brand.
\nMany business owners assume these types of brand partnerships require companies to shell out big bucks for a celebrity endorsement. Although that is one possibility, it isn’t the whole story in the modern influencer marketplace. Influencer marketing includes a range of tactics that can help companies of all sizes raise brand awareness, build credibility, and increase sales.
\nTable of Contents
\nInfluencer marketing is the process of collaborating with an individual who has the potential to influence audience opinions—typically due to a large personal following, an established brand, or perceived authority. Partnering with influencers can help businesses boost sales and elevate their brand profiles. Here’s an overview of some of the main benefits for ecommerce brands.
\nDrive sales collaborating with creators and influencers
\nWhether you’re finding partners, sending out gifts, or tracking affiliate offers, Collabs is built to help you drive more sales.
\nBrand partnerships can be as limited as one social media mention or as extensive as paying a celebrity to act as the face and voice of your company for years. Here are five typical ways that brands collaborate with influencers.
\nSponsored social media posts are dedicated posts about your products or services. Typically, you pay a social media influencer to create content about your company and post it to their social media channels.
\nBlog posts are another popular type of sponsored content: You pay an influencer to create and publish a blog post featuring your products or services. You might purchase an entire post about your company or pay to be featured in a product or service roundup, such as a professional baker’s list of the 10 best kitchen gadgets or a travel influencer’s guide to red-eye-friendly apparel.
\nGuest blogging is one common type of guest appearance: A business contacts an influencer to ask if their blog or website accepts guest content and pitch a few ideas for posts. If the influencer accepts, the company drafts a blog post and includes a backlink to its own site. This can put you in front of an influencer’s audience and let you retain control of your branded content.
\nYou also can consider offering subject matter expertise as a guest on an influencer’s podcast, webinar, or panel.
\nBrand ambassadorships establish a long-term relationship between an influencer and a brand. Brand ambassadors will promote your company as outlined in your contract—for example, they might attend events hosted by your company or on behalf of your company, include your products in a particular number of social media posts per month, or mention you in a certain number of articles.
\nMany businesses send free products to influencers or offer complimentary services, event tickets, or comped travel in hopes of earning a favorable review or mention on the influencer’s outlets of choice. For example, you might send a free batch of naturally sweetened gluten-free cookies to a wellness blogger or your handmade stick-on body jewels to an Instagram influencer in the beauty and fitness space.
\nThis strategy doesn’t guarantee that an influencer will cover your product (or cover it favorably), so many businesses strategically target influencers who seem likely to respond positively to the gift.
\n\nSuccessful influencer collaborations fit your budget and goals, align brand values and target audiences with an influencer’s personal brand and reach, and result in measurable outcomes. Here are five tips for engaging in effective brand partnerships for influencers and ecommerce companies.
\nStart by identifying your goals for the influencer collaboration. Do you hope to raise brand awareness with a certain audience, increase sales, or improve your reputation? This will affect who you pick as a partner and the terms of the partnership.
\nIdentify key performance indicators (KPIs) and decide how you’ll define success. For example, you might track engagements with influencer marketing content, new traffic to your site, and attributable conversions. You might monitor indirect metrics, such as overall sales, social media mentions, and brand awareness metrics. Set goals and plan to track metrics and calculate ROI on your campaign.
\nInfluencers are everywhere. To choose the right partnership for your business, start by identifying influencers popular with your target audience. You can manually scroll through follower information on social media platforms or use an influencer marketing platform such as Shopify Collabs to automate the process. Influencer platforms can provide information about audience demographics, and, in some cases, recommend similar influencers, rate audience quality, or generate a list of influencers for a specific keyword.
\nOnce you’ve generated a list, spend some time researching the influencer’s personal brand, making sure that their brand values and voice are a good fit for your company.
\nFollower count is a key metric in the influencer marketplace. Frequently, the more followers an influencer has, the more they will charge for their services. In many cases, however, follower count is less important than follower engagement and trust.
\nMicro-influencers may have anywhere from 10,000 to 100,000 followers. These influencers are likely to be less expensive than larger influencers and receive fewer queries, which can make them a value for paid partnerships. In some cases, smaller influencers also have more engaged audiences.
\nOnce you’ve identified a partner, it’s time to hash out deliverables (such as social media posts, reviews, mentions of your company on social channels, event appearances, etc.), compensation, and process. Some influencers will have established brand collaboration service menus or media kits and can provide quotes for specific partnership activities. If your partner doesn’t, you can negotiate a mutually agreeable solution that spells out expectations and compensation.
\nOnce you’ve reached an agreement, specify deliverables, payment, content creation process, campaign management responsibilities, and timelines in a written contract. Be sure to also ask about your partner’s disclosure policies and make sure that disclosure language doesn’t invalidate the credibility of the content. For example, “I’m paid to review products, but opinions are my own” will establish more trust than “This review is sponsored content.”
\nMany ecommerce brands embrace influencer marketing strategies. Check out these three success stories of Shopify clients.
\nDinnerware brand Fable used influencer gifting to raise brand awareness in its local market.
\n“The first thing we realized in Vancouver is that no one had ever heard of us or our products,” Fable founder Joe Parenteau says. “It was going to be really hard for people to trust our brand online. We ended up trying to find as many different influencers or influential people on Instagram or on Facebook that we could gift our product to.”
\nInitially, this approach was born of limited resources. “We really were in a position where it was like, ‘We can’t pay you for anything,’” Parenteau says. “‘If you like it, we’d appreciate it if you share it. But there’s no obligation.’”
\nParenteau’s team contacted hundreds of content creators and shipped all gifts at once, resulting in as many as 60 content creators in the Vancouver area posting about the products within the span of a few days, generating a lot of interest. “That really kickstarted us,” Parenteau said. “We still use that strategy.”
\nEmily Chong and Nathan Chan, founders of the water bottle company Healthish, aren’t new to influencer marketing—Chong used to be an influencer herself.
\nLike Fable, Healthish started with influencer gifting. “We have such a low-cost item to produce, where we can afford to send to hundreds of influencers per month,” Chong said. As the business matured, Healthish expanded its strategies to include sponsored posts.
\nChong and Chan also discussed the importance of identifying influencer fit. “At the beginning, you can pick people in the different niches and see what actually works for you and then decide to go down that path,” Chong said.
\n“We sent out to fitness influencers,” Chan added. “We sent out to vloggers, we sent out to people that were in all sorts of different niches and markets. And then we could see when somebody posted what that result would be and we refined it. So it’s a little bit of trial and error.”
\nLiza and Lana Mushamel, co-founders of nail product company Twinkled T, use the undervalued strategy of partnering with micro-influencers to boost sales.
\n“People believe that you need to go big or go home and reach out to influencers with a million-plus subscribers or a million-plus followers on Instagram,” Lana says. Twinkled T initially partnered with 10 social media influencers with 30,000 to one million followers, and the Mushamel sisters were surprised to get better results from influencers with smaller followings.
\n“If I’m following an account that only has a thousand followers, it’s because I care about what they have to say or what they’re trying to sell me,” Liza says. “I personally am more likely to purchase from someone with a smaller account, cause I feel like they’re being more genuine in what they’re showing and what they’re selling.”
\nThe cost of influencer collaborations varies depending on project type and scope and on the size of the influencer’s following. Some influencers will post information on their social media channels in return for a free product; major celebrities, meanwhile, can demand millions of dollars for a single ad appearance.
\nIdentify key performance indicators upfront to measure the success of a brand partnership. Consider the following metrics:
\nAsk your influencer partner about their approach to content creation, including whether they’ll grant you an editorial review and if you can provide information or other help to support the process. In some cases, influencers will set parameters about sponsored content or let you provide guidelines.
\nCommon influencer marketing partnership mistakes include:
\nThe Federal Trade Commission (FTC) requires influencers to disclose advertising relationships in sponsored content.
\nhttps://www.shopify.com/blog/brand-partnerships-for-influencers
\nThink of every ad you’ve seen today. Where were they? Depending on your day’s activities, you might have spotted advertising on billboards, broadcast television, social media channels, websites, physical newspapers, search results, or any number of media outlets. Now, consider the fact that each of those ads represents a transaction between a company (the advertiser) and an ad vendor (such as a platform, media outlet, or advertising agency).
\nMedia buying handles the full scope of purchasing and placing these diverse ad types. A skilled media buyer can help you determine where to place ads, secure a cost-effective and goal-oriented media mix, execute campaigns, and use performance data to optimize results.
\n![\"Template](\"https://cdn.shopify.com/s/files/1/0070/7032/files/opt.gif?8282590590928260908\")
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\nMarketing 101
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\nTable of Contents
\nMedia buying refers to the process of purchasing ad space for a company’s marketing campaigns, covering both traditional and digital media placements. The two main types of media buying are:
\nThere are a few differences to note between these two aspects of marketing.
\nMedia planning involves conducting media research and using your business’s marketing goals, marketing budget, target audience information, and key campaign messages to create a media plan for a specific marketing initiative or campaign. Your media plan will determine your campaign’s media mix and identify key channels for paid media, owned media, and earned media tactics.
\nOnce your media plan is ready, your media planner will hand it off to your company’s media buyer, who is responsible for executing key elements of the paid media portion of the plan. Media buying focuses on selecting and vetting media outlets and purchasing ad space. A media buyer’s job also includes negotiating with vendors, managing campaign deadlines, trafficking ad placements to vendors, and monitoring campaign performance.
\nSome companies employ separate media planning teams and media buying teams who work together to plan campaigns. Small businesses might delegate both tasks to the same member of a marketing or media team.
\nWondering how media buying works in practice? The process has seven key steps.
\nReview your media plan, keeping the campaign’s target audiences, marketing goals, ad spend budget, key performance indicators (KPIs), and target media mix in mind. Although you won’t finalize the ad creative until later in the process, start considering what types of ads you’d like to run. For example, if you plan on running video ads, target online publications that allow the format.
\nDevelop a list of media outlets, ad agencies, and ad vendors under consideration. If you’re considering both direct and programmatic placements, you might also list media buying platforms here and note pricing.
\nAn RFP (or request for proposal) can help you simplify the ad-buying process by putting some of the work on media outlets and ad agencies. Your RFP will include advertising campaign details such as your goals, target audiences, approximate budget, KPIs, and a response deadline. Vendors will respond with a tailored campaign proposal based on these specific goals.
\nGather and review the RFP responses, organizing data points such as tactic, audience, cost, and estimated KPI performance into a spreadsheet. Although media buyers don’t typically send RFPs to media buying platforms or other media buying tool providers, including these vendors in your target list can help you compare the cost of these options to direct placements or agency contracts.
\nOnce you’ve organized your data, compare options and select a cost-effective set of ad placements, making sure your selected media mix aligns with the specifications in your media plan.
\nAn insertion order (IO) is the legal agreement between an ad vendor and the organization placing an ad. It will include the cost, run dates, add specifications, and information about KPIs (if applicable). Create and send an IO for each media placement.
\nCoordinate with your account managers and creative team to develop the creative assets and place your ads with vendors according to the deadlines specified in your IO.
\nMonitor campaign performance data—such as click-through rates and conversions—and make adjustments to your creative assets to optimize the results. If your vendor guaranteed certain performance metrics (like impressions), double-check that your campaigns deliver on the promise. If they don’t, reach out to your vendor to negotiate a make-good.
\nMedia buying is a time-intensive process. These tips can help you increase efficiency and optimize returns on your ad spend:
\nComparing and tracking ad performance can be tricky. To make it easier, select ad placements for which you can effectively track the KPIs specified in your media plan and confirm how and when ad vendors will provide performance data. Then set calendar reminders that coincide with the reporting periods for each ad vendor.
\nOne of the tricky things about media buying is that each ad vendor will organize proposal information differently. Some will report cost per click, others total campaign cost, and still others cost per day. The same is true of performance data; vendors might report an estimated number of impressions, clicks, deliveries, or other campaign performance metrics.
\nFor a media buyer, this can feel like comparing apples to oranges to pigeon eggs, making it challenging to analyze campaign options. A thoughtful RFP can simplify that media buying process. Although it isn’t always possible to reduce a diverse set of metrics to apples-to-apples comparisons, setting RFP parameters can speed things up.
\nAdvertising agencies and media buying agencies employ experienced media buyers. Some also offer media planning services. They can help with media plan strategy, vendor selection, performance tracking, and even offer feedback on ad creative or insights into underperforming campaigns. Because agencies purchase a large volume of ads, they can also exercise more leverage in negotiating media buys than an individual media buyer can.
\nEvaluate your team’s skills and capacity and consider using an advertising or media buying agency to take on all or part of the media buying process.
\nPaid media placements can include traditional media options such as print, TV, and radio ads, billboards, direct mail campaigns, and digital media placements such as banner ads, paid search ads, video advertising, and sponsored content.
\nCommon media buying mistakes include:
\nData has two critical functions for the modern media buying process:
\nSay you’ve met someone you really like. How do you get to know them and build a rapport? You could ask their friends if they’re single, attend a few meetings of their Bruce Springsteen fan club, or double-tap on all of their Instagram posts. Or, you could walk right up and ask if they’d like to go on a date.
\nMarketing professionals may recognize the similarities between these two tactics and upstream and downstream marketing strategies. Conducting market research by talking to friends and brushing up on the E Street Band’s discography are upstream processes aimed at setting yourself up for future success. Taking the direct approach by asking for a date represents a downstream marketing technique meant to get immediate results.
\nRead on to learn about the key differences between upstream marketing and downstream marketing, and how they both can influence your customers to buy from you.
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\nUpstream marketing focuses on understanding and influencing the desires of the consumer over time. Rather than generating immediate sales, upstream marketing strategies aim to build relationships and identify future markets. Upstream marketing techniques aim do the following:
\nDownstream marketing strategies focus on short-term sales. This includes using sales tactics such as advertising, email marketing, and product promotion to sell products to consumers who are ready to buy. Downstream marketing efforts are typically:
\nA conversion-focused Shopify theme like Victory can support these tactics with promotional features, product discovery, and upselling tools.
To understand the difference between upstream and downstream marketing, consider this hypothetical scenario. Imagine you’re the marketing director of an online business selling a kitchen device that peels and cores pineapples. You might use an upstream marketing strategy by creating a viral recipe video that includes fresh pineapple as a key ingredient, thereby increasing the demand for your product.
\nAfter the success of this campaign, the marketing and sales team could decide to employ a downstream marketing tactic with a short-term sales campaign on Instagram that celebrates International Pineapple Day (every June 27).
\nSignificant differences emerge when you dig into the tactics and desired outcomes of each strategy. These are some ways in which upstream and downstream marketing are different:
\nUpstream and downstream marketing have different strengths, which is why businesses often use these strategies simultaneously.
\nUpstream and downstream marketing share a common goal: connecting with customers. Both marketing processes require a firm understanding of your customer base and will be most successful when executed with collaboration across sales, marketing, analytics, and design teams.
\nAn upstream marketing plan that includes analyzing market and competitor data can influence future product development by exposing gaps in the market and revealing unmet consumer desires. This is essential for a smooth product development cycle, because potential user needs can be addressed before they arise. Downstream marketing focuses on promoting current products. Evaluating the success of downstream activities can provide insight into customer satisfaction and contribute to product development. After reviewing the success of a short-term sales campaign, your marketing team can use performance numbers and customer feedback to tweak product development, features, or messaging.
\nSuccessful businesses use upstream and downstream marketing tactics in tandem to create an overall marketing strategy that balances short-term sales goals with long-term growth. Marrying upstream and downstream activities can create a cohesive campaign strategy that allows you to effectively reach customers and position your team for future marketing success. To find the right balance, establish short-term sales goals using focused campaigns and downstream processes, and long-term growth objectives with an upstream marketing plan.
\nA downstream marketing strategy process aims to get the customer to click and buy immediately. Upstream marketing considers future behavior—its goal is to subtly shape the preferences and desires of consumers over time so that one day they will buy your product.
\nhttps://www.shopify.com/blog/upstream-vs-downstream-marketing
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