So you want to start dropshipping…but which niche should you choose?
Well that’s the million dollar question isn’t it. (Literally. You could be making millions if you choose the right niche).
If you’re ever thought about starting an online store, you’re likely to have been confronted with this question. It’s a tough one. And it’s not necessarily just about which one you are most ‘passionate’ about anymore.
Choosing the right niche is extremely important. For now, and the long run.
When you find a lucrative dropshipping niche, it’s easier to find winning products and generate sales faster, meaning things will start to snowball.
You can reinvest your profits and start to scale as you’ll have more budget to invest in ads and test out new products. Then, you can use your first store as a blueprint to set up new stores in different dropshipping niches.
That’s when your online business will really start to take off.
But if you choose the wrong niche, your new dropshipping store will be a sinkhole that drains your time and money.
No matter how many hours and cash you throw at it, you’ll struggle to make any sales.
That’s when a lot of people throw in the towel. They go back to their day job and give up on the dream of being financially independent.
So how can you find a profitable niche?
That’s what we’re going to reveal in this guide.
This isn’t your average list of “most profitable dropshipping niches.”
We’ve compiled the expert advice of six-figure dropshippers. You’ll learn how these successful entrepreneurs got started.
Ready to find your niche?
Grab a coffee, make yourself comfortable, and let’s begin.
5 Steps to find profitable niches
Before we get to the expert tips, let’s quickly go over what to expect from this expert guide.
For each step listed below, you’ll find a quick overview of the expert and how they became successful. Next, you’ll hear how each expert chose their niche.
And at the end of each step, you’ll find a key takeaway with actionable insights you can use to find a winning dropshipping niche for your online store.
Now we’re all up to speed; let’s get into it.
Expert 1#: Lauren Mitchell
Lauren Mitchell is a seven-figure eCommerce and dropshipping entrepreneur. After graduating from university and starting a career in law, Lauren wanted a way to escape the confines of the nine-to-five.
After researching different ways to make money online, Lauren chose to launch a dropshipping business. It meant she could get started without needing any inventory or lots of startup capital.
Within a few months of launching her store, Lauren earned more from dropshipping than her full-time job. Fast forward to today, and Lauren has generated over $5 million in revenue through eCommerce and dropshipping.
You can hear more about Lauren’s story and get more expert tips by watching her full interview on the SaleHoo YouTube channel.
Lauren’s Top tip: Find something you’re passionate about
“It’s a lot better to find a niche that you’re really passionate about and pour everything into those products. Really stick with it until other people see that product the way you see it.
For me, that’s what I’ve really found is so helpful in creating a long-term brand. That’s actually bringing something to the public and making it trendy with your marketing and with how you present it – through influencers and all forms of different collaborations. Find something that you’re really passionate about and that you can see as being a huge hit.
It can’t just be something that’s pretty or just sitting on a desk. It has to be something that has a “why” to it. Because ultimately, when you’re selling, it’s all about that “why.” It’s all about, “What problem does it solve?” It has to be really useful.”
This is one of the important pieces of advice that any aspiring entrepreneur needs to hear.
Choose something that interests you.
You don’t have to love everything about the niche, but you should find it interesting.
There aren’t many people who have a true passion for cleaning, but plenty of dropshippers have an interest in the niche - and they make lots of money selling cleaning products!
If you commit to a niche in which you have zero interest, you’ll lose out on one of the biggest benefits of running your own business.
It will feel like going to work when you have to create content, research products, and do all the other tasks around creating a profitable ecommerce business.
You’ll be creating a job - which is the lifestyle that 99% of online entrepreneurs want to escape.
It’s also hard to really empathize with your audiences’ wants and needs if you are not as passionate about the niche as they are. And you need to know your audience inside out to build a loyal customer base.
So how can you put this advice into action?
Well, some people find their passions early in life. But for others, it takes time to discover their passions.
The best way to find what you’re passionate about is to do a brainstorming session.
Grab a pen and some paper and ask yourself the following questions:
- Which magazines, blogs, and websites do you read or visit the most?
- Which topics or accounts do you follow on social media?
- What type of products do you spend the most money on when shopping online?
- If somebody gave you $500 to spend, what would be the first product you would buy?
By thinking about what you spend your time doing and what you spend your money on, you can get closer to finding your passion.
Expert 2#: Ethan Dobbins
Ethan Dobbins first started dropshipping when he was 16 years old. But, like most successful entrepreneurs, his first attempt wasn’t a huge success, so he went back to his job as a cashier.
Using the knowledge he gained from building his first store and with some capital saved up from his day job, Ethan tried dropshipping again. This time, he generated $50,000 in revenue. Eventually, Ethan scaled his business to $280,000 in revenue with profits of around $90,000.
Learn the full story of how Ethan scaled multiple dropshipping brands past six figures in women’s accessory and home decor niches here on the SaleHoo website.
Ethan’s Top tip: Follow the market demand
“I would recommend looking at what’s selling right now, see what the market wants. For instance, with this new product I’m selling. I’ll be honest; I’m selling waist trainers to women. I know nothing about waist training. I know nothing about women’s health. I know nothing as to why people would buy a waist trainer. But I knew, hey, there’s a huge market for this.
Females love shopping online typically more than men, and it’s a great price point. I was like, alright; this is a product that I know I can market effectively. I think it’s super simple, but I would say 90% of new people into dropshipping just don’t do customer research.”
Choosing a niche with no demand is a surefire way to waste your time and money.
When you’re looking at a potential dropshipping niche, you need to ask yourself:
Will I be able to make money selling products in this niche?
The best way to answer this question is with market research.
There are some great free and paid tools to help you get a better understanding of market demand.
Google Trends is a free tool that shows you the search terms that are used in specific locations and globally. Enter your seed keyword or topic, and you can see the interest in the niche over time:
If the interest is consistently high or increasing over time, it indicates that there is substantial demand for information AND products.
You can also use paid tools like Ahrefs to learn about the search volume and keyword difficulty. These metrics can help you determine how popular and competitive the niche is.
In the example above, you can see that the weight loss niche is super-competitive.
But you can use the related terms and filter options to narrow in on less competitive sub-niches.
Alongside data from market research tools, you can get a better understanding of market demand by engaging with communities and groups on social media.
It can take time to properly research a dropshipping niche, but you’ll be in a much better position to judge demand when you do. You’ll know what people interested in the niche care about, what products they need, and how much they are willing to spend.
These are great insights to help you decide if a dropshipping niche is profitable.
Expert 3#: Chris Wane
Chris Wane started dropshipping as a side hustle back in 2014. He launched five unsuccessful eCommerce stores over three years before finding a winning formula. Within six weeks of launching his sixth store, Chris earned £10,000. Within a year, the store generated $500,000 in revenue.
Fast forward to today, and Chris has built a seven-figure online business with stores in several dropshipping niches.
Watch the full interview with Chris to get the inside story of how he went from five failed stores to $600k in one year.
Chris’s Top tip: Choose a niche with multiple products to sell
“Well, every product has a certain level of demand for it. Ultimately, if there’s only a certain level of demand, you can only meet that demand with the product; you can only scale it so far. So, when we talk about profitability ceilings, it’s very much a case of we can only scale certain
products. So far, not every single product you try and sell will be a golden goose, a seven-figure winner.
So, I think it’s going to be some products that may only make ten, twenty, thirty thousand dollars. And then, at that point, there’s not really much else you can do with it. And that’s fine. You just have to pivot to something else. But really, it’s all about scaling profitably.
You don’t always have to find that big six, seven-figure winner. You can find multiple small products that sell consistently but at a lower level, and that can still work really well.”
Many beginner dropshippers make the common mistake of choosing a product rather than a niche.
They hear about a product that somebody else has made a load of money with, and they try to copy the formula for success.
And most of the time, they fail.
Instead, you want to choose a niche with multiple products that you can sell.
So how do you know which products you can sell in a dropshipping niche?
If you’re signed up to SaleHoo, you can use our product research tools and the SaleHoo Directory to quickly find products and suppliers in a niche.
It takes a bit longer, but you can also use Amazon to discover types of products.
Head over to Amazon and click the “All” button in the top left of the homepage.
Scroll down to “Shop By Department,” and you’ll see a bunch of possible dropshipping niches.
Click on one of the departments listed, and you’ll see lots of product categories listed in the left-hand menu and “Featured categories” in the center of the page:
This can be an excellent way to find potential dropshipping niches. You can also get an idea of the types of products you can sell.
Some niches will be bigger and more competitive than others. But you can start with a smaller sub-niche and expand once you start to generate sales.
Expert 4#: Davie Fogarty
After graduating high school, Davie Fogarty discovered his interest in marketing and social media. He started growth-hacking Instagram accounts before studying marketing and mining engineering.
After dropping out after the first semester at university, Davie started multiple failed businesses selling everything from mobile phone cases to Vietnamese rolls. Davie’s breakout success was The Oodie. The oversized wearable blanket brand has generated over 3.9 million sales and is valued at $280 million.
Davie’s Top tip: Test your niche idea and fail fast
“All my brands started in such a different way back then. I think what I would suggest now is just be really vigilant when you’re coming up with an idea, like looking for problems that need to be solved.
“Don’t get addicted to an idea, as it just might not work. Get addicted to the process of learning, finding out what actually works, or just get addicted to the industry itself. Test the ideas as lean as possible, determine exactly what success looks like, then stick to it.
Failure is fine. I’ve failed a lot. But it’s extremely important to find small bits of success which can then help build your understanding of what actually works. You need to be on the lookout for positive feedback loops that you can then scale.”
Here’s the secret that you won’t hear from many dropshipping gurus:
Your first store will likely fail.
And that’s okay.
It’s part of the learning process. The faster you can learn, the faster you will find the winning formula and niche that works.
Be comfortable with failure - but try to fail fast.
Most people need to test a lot of ideas before they find a winning niche. This is especially true if you’re new to eCommerce and digital marketing.
That’s why testing is so important.
You can learn if a niche will be profitable by quickly testing product ideas.
If you have a budget to work with, social media ads are a great way to quickly determine if there is a market for a product.
This phase is about gathering feedback on the niche and the products. You might make a few sales, but the goal isn’t to make money yet.
It’s about seeing how your audience reacts and finding out if the dropshipping niche is viable.
When you know that there’s a potential customer base and interest in the products, you can scale and start to generate profit.
Expert 5#: Jordan Welch
Jordan Welch is a popular YouTuber and seven-figure eCommerce entrepreneur. Like most successful dropshippers, Jordan spent several years failing before finding success.
In May 2020, Jordan moved back in with his parents after most of his business ideas had failed to take off. It was at this point Jordan launched his first successful eCommerce store. Within eight months, the store generated almost $1 million in revenue.
Jordan’s Top tip: Find Viral Products
“My hybrid storage strategy concept is very simple. All I did was scan my Facebook and Instagram feed every single day, looking for products that were going viral. The two main things I’m looking for are tons of engagement and room for improvement.
Basically, is there an opportunity for me to create a better advertisement, a better website, or a better offer for this product? I found a few products that fit these criteria, and I started testing them with Facebook ads on my hybrid store.
A hybrid store is a clean, branded website that has a variety of products in the same niche or industry. This store is an exact clone of the one that I use to test products and find my winner.
When I was starting this brand, I tested products. I found a winner. I created a branded website, made a custom video ad, and improved the product quality and shipping time.”
Social media can be a great place to find trending products and dropshipping niche ideas.
While Jordan mentions Instagram and Facebook in his advice, TikTok is the best place to source unusual and overlooked niche ideas.
When TikTok users upload videos, they use hashtags to try and get and get more exposure.
You can use these hashtags to find product and niche ideas.
Now, you don’t want to search for hashtags like #dropshippingproduct or #ecommerceproduct. These videos are made for an audience of sellers and marketers like you.
The goal is to find videos made for an audience of shoppers - the people actually buying the products.
That’s why you want to focus on hashtags like:
A quick search can reveal a bunch of viral product ideas. However, because it’s easier to get engagement on a platform like TikTok, it’s best to focus on the videos that receive 500k likes.
If you already have a niche in mind, you can also search for topic and product-related hashtags.
For example, the #campinggear hashtag features a bunch of product ideas:
You can try different variations of phrases like gear, hacks, finds, and other related terms to find more viral products on TikTok.
Start dropshipping today with SaleHoo
We’ve covered the five steps you can take to find a winning dropshipping niche.
Now, there’s one more lesson that you can learn from the successful entrepreneurs featured in this guide.
They all started as a beginner - just like you.
Most didn’t get success overnight. It took time to find the right niche. But they stuck at it and have been rewarded for their hard work.
If you take ownership of your journey, work on refining your skills, and find the right products, you can become a seven-figure dropshipper too.
And if you need some help along the way, our Salehoo resources, tools, and expert team are here to support you.
Reach out to our customer support team today for advice on what to do next on your journey to becoming financially independent.