Since I’m a part of the content team at Shopify, it was now my turn to build an ecommerce business from scratch and post my findings and results on the Shopify blog. This time, I wanted to start a business that manufactured and imported products using Alibaba.
Coming up with the Business and Product Idea
When I started thinking about the business and product I wanted to sell, I first thought of who I wanted to serve. The more specific my target customer was, the easier it would be to find them and sell to them.
As a starting point, I looked at products I use everyday, and looked at products that would serve my needs. Some of the most successful businesses came out of serving a self-interested need first.
I’m a gamer, so I started looking at Amazon and Ebay for product ideas by browsing the gaming accessories categories. Eventually, I came across a product I use: blue light blocking glasses.
Blue light blocking glasses work by filtering out blue light from computer screens and televisions. This technology is commonly seen in shooting glasses, snowboard goggles and night driving glasses.
At home and at work, I wear this kind of glasses due to my eye strain issues. If I look at a computer screen for too long, my eyes begin to give out. I wanted to take these glasses and position them to gamers like myself, who might spend hours in front of a screen at a time.
Research and Validating the Idea
After I had a rough idea of what I would sell, I began to look at the market and at competitors. I looked on Amazon and eBay to look at how well these glasses sold, how much they sold for, the feedback/criticisms from buyers, and who the major players were.
The first thing I noticed was that people were willing to pay anywhere from $25-$90 for a pair. This got me excited since I knew I could likely source these from China for much cheaper per unit.
I also looked at Google Trends to see whether or not this was an increasing search trend.
The next thing I did was a very rough, very unscientific, break-even analysis. I wanted to see how many glasses I would need to sell to break-even based on my guesses of cost and price.
I guessed I would order 100 glasses, pay $7 for each and sell them for $39.99 (similar to what competitors sold their glasses for). This gave me a calculation of around 21 glasses needed to be sold to break-even. Again, since this was very rough and didn’t factor in things like marketing costs, shipping and anything else, I doubled that number. Selling 42 glasses seemed reasonable to me.
Next, I looked at if I could even confidently sell 42 glasses. I reverse-engineered how I thought I would sell at least 50 glasses by brainstorming the channels I would sell them through and how many I thought I could sell in in channel.
Coming up with the Name and Logo
I began writing down and brainstorming names that I thought would best describe the benefit of the glasses.
I eventually went with “Syght”, a unique spelling of the word “Sight”.
Finding a Supplier on Alibaba and Importing Products
To find a manufacturer who could create the type of glasses I wanted, I looked to Alibaba, the world’s largest wholesale and manufacturing marketplace. I began searching for “Computer glasses” and made a short list of potential suppliers I wanted to contact.
I began to compare suppliers on their minimum order quantities, price, and available designs. I created a mockup of what I wanted my glasses to look like and where I wanted the logo to be placed on the glasses.
I contacted around 20 suppliers in total after a few days of searching and exchanging messages. I eventually narrowed it down to 2 suppliers after ensuring the suppliers were reputable by looking at how long the supplier has been active on Alibaba, their reviews, and if they offered Trade Assurance.
Due to the nature of this case study, I was limited with the amount of time I had. This meant that I didn’t order a sample before placing a larger order. Always order a sample and don’t do what I did. Since this was an educational case study, there wasn’t much to lose on my end by simply trusting the supplier.
I negotiated one supplier down to 100 units for my first order, at $3 per piece. In total, the order came out to $370 including shipping
Since I wanted to sell these glasses for a hefty margin, I decided it was a good idea to try and increase the perceived value of the glasses. To do this, I wanted to bundle in a few items with each purchase.
I went to AliExpress to look for glasses cases and microfiber cloths. AliExpress is similar to Alibaba (and owned by the same company) but allows for smaller and single quantities to be ordered. This is good if you want to buy one offs of an item, or you don’t require any custom manufacturing.
I simply searched for plain black glasses cases and yellow microfiber cloths and selected the least expensive ones based on reviews.
Building The Online Store
Now that I had a product and logo, it was time to create the online store. Of course, I chose Shopify to create the website. Shopify allows me to create a beautiful and professional ecommerce website, complete with payment processing, managing inventory, and a lot more.
I chose the Shopify Basic plan, walked through the basic settings and proceeded to choose a theme for my website.
I chose the Startup theme since it’s a great theme for those selling only one product.
I registered the domain SyghtGlasses.com through Shopify and then began to customize the theme. I purchased a stock photo from iStock and used it as the hero for my homepage. With a little Photoshop, I made the gamer look like he was wearing my glasses.
Taking Product Photos
Once the glasses arrived from China, it was time to take some great product photos. Fortunately, at the Shopify office in Toronto, we have the camera and white backdrop that can produce some high quality photos. But that doesn’t mean I needed this equipment to create great photos. I could have shot awesome photos with my phone’s camera, too.
Submitting to Product Hunt and Reddit
Now that the website was ready, I had some great product photos, and I got some feedback from coworkers at Shopify, I was ready to get traffic to the store.
My submission to Product Hunt did relatively well, achieving 28 votes and 4 comments.
My Reddit post on the other hand, did extremely well. It stayed at the top of the subreddit for two days and ended up with 185 upvotes and 59 comments.
The most important thing though was that both submissions got me sales. A lot of sales.
During those two days, I received 21 total orders. 6 of which I can confidently attribute to Product Hunt. As for Reddit, my guess is that 12 of them came from Reddit. Unfortunately, traffic from Reddit didn’t track well.
All the orders were exciting but now the hard work of packaging all the orders and shipping them around the world at the Post Office begun.
After a few time-consuming experiences at the post office, I started using Shippo to print shipping labels from home. Shipping each package cost me around $8-$11. The bubble mailers I shipped the glasses in cost around $1-$2 each depending on how many I purchased at one time. I chose to make shipping free on the website and eat up the cost. I decided this would help conversions on the website.
Setting Up An Affiliate Program
My primary strategy to sell these gaming glasses was to reach out to influencers in the gaming community (Twitch streamers, YouTubers) and have them promote my glasses for an affiliate commission. My plan was to offer each influencer a unique coupon code of $5 off that they could share with their audience. Every time their unique coupon is redeemed, they’d earn $10.
I setup Affiliately (to setup affiliate coupons and links) on my Shopify store and began searching for gamers on Twitch and YouTube. I tried to look for influencers with small to medium sized audiences. I wanted to ensure they’d be receptive, accessible and looking to monetize their content early. I knew that if I contacted big name YouTubers or Twitch streamers, I was unlikely to get a response.
After contacting 30, I got 4 people on board with promoting my glasses. Some of them even created reviews on YouTube!
[youtube id=”1usOWFNYrz4″ align=”center” mode=”lazyload” maxwidth=”600″]
3 purchases wound up coming from these affiliates.
I eventually had someone who managed an Instagram account for gamers reach out to me asking to be an affiliate.
Once this post was shared, it generated 13 additional sales.
Total Sales and Breakdown
I tried a few other channels and I will have a complete breakdown of each other channel I tried in the full post, but I just wanted to highlight a few of the more successful marketing strategies here.
During the course of over 5 weeks, the store made $2,416.51 in total revenue, selling 61 pairs of glasses. Here’s a breakdown of all the sales:
- Reddit: 4
- Product Hunt: 6
- Facebook ads: 5
- Affiliates: 16
- Google Product Listing Ads: 8
- Twitter: 2
- Instagram: 1
- PSFK.com: 1
- Unknown: 15
- Other: 3
The business incurred $2,071.99 in total expenses. Here’s a breakdown of the expenses:
Here’s an overview of the traffic and sales during the 5 weeks the store was open:
This was just a slice of what I did during the 5 weeks of this business being open and the time I took before opening the business to prepare the launch. Be sure to check out the more detailed writeup on Shopify.
Oh, and, one more thing.
You can win this business.
Yup, we’re giving away this business to one lucky entrepreneur. Head over to Shopify to learn more!