Table of Contents
- 1 Ecommerce: First steps into the future
- 2 A Plump Novelty Product Offers Fat Returns
- 3 Profits back to losses
- 4 Right Time, Right Page, Right Niche
- 5 Build a Plush Toy Empire
- 6 Making the most of each visitor
- 7 Slow Business for Rivals and Copycats
- 8 Next steps
- 9 Tze’s Takeaway Tips
After just a few emails with Tze Hing Chan it became evident that the young Malaysian entrepreneur was the epitome of a go-getter.
Tze was determined to succeed and even left his Melbourne college exchange to go to Singapore. He didn’t like the laid-back atmosphere at Australian universities.
Tze began his internship at a startup immediately after completing his marketing and finance studies. During his two-month internship, Tze met entrepreneurs in ecommerce and learned more about dropshipping.
Tze made $19,000 profit in just two months from dropshipping bubble tea plush toys.
And did I mention that this was all happening in the middle of an epidemic?
Tze did not go straight from dropshipping to bank learning. There were many learnings and failures along the way.
We spoke with Tze to learn how he developed the skills that enabled him to make more money than many students who just graduated. We learned about Tze’s winning product and the URL of his store, as well as some other tips and tricks that he used to increase his sales.
Dropshippers are rarely open to sharing information about their products and stores. So, trust me when I tell you that this stuff is absolutely gold. Let’s get to it.
Ecommerce: First steps into the future
Tze learned dropshipping from entrepreneurs he met during his internship. He quickly found himself dedicating his weekends to researching how to start an online business.
After some time, Tze decided to give dropshipping a try and began with phone cases. He realized that the best dropshipping products took advantage of a trend. That is why he chose bubble tea, also known as boba, to be his niche.
“I knew the bubble tea trend was on the rise, especially in Asian communities so I searched AliExpress for bubble tea products. Phone cases were my first product.
Tze put together a bubble tea-themed store with the phone cases as the main items. After his store was complete, Tze began running ads and even made some sales. Despite the sales, the store lost about $200 after the ad spend. Tze was not disappointed.
“I didn’t make a lot of money, but I did know it worked at the time so dropshipping was a viable option for me.”
Tze opened a variety of stores after starting with a few bubble tea phone cases. He sold kitchen equipment like vegetable cutters and handheld knife sharpeners at one point. To open another store for phone cases, he partnered up with an ex-colleague from his internship.
Tze was slowly learning the ropes of ecommerce from these failed stores, even though none of them made any profits. Tze would take everything he learned from his failed stores and apply the lessons to his next venture. He knew that he would eventually build a successful business.
Tze was able to taste success in the latter part of 2019.
A Plump Novelty Product Offers Fat Returns
After finding a cute seal plush toy, Tze built a store around the item and began running Facebook ads. Dropshippers around the world loved the toy and soon there was a flood of orders.
In just two weeks, Tze made over $7500 in revenue, leaving him with around $1500 profit. He knew that the hype would fade quickly and he didn’t want to be tempted by fate. After the initial rush, he decided to stop all advertising.
“I was quite excited, but eventually the trend died down. It was just before Christmas and I knew the [products] wouldn’t make it for Christmas so I stopped running ads to ensure I didn’t get angry customers.”
Profits back to losses
Tze opened the seal plush toys store online, his first online business that made a profit. His success brought him back to life.
He was eager to make more money and decided to go after a niche that he was passionate about. He built a mixed martial arts apparel store. He learned from his previous stores and realized the value of a well-organized, professional business. He imported more than 50 products, removed all background images and organized everything logically.
However, the store was still a total failure. Tze now sees the error and has a plan of action.
Dropshipping has one thing that I learned about is that most of your customers are impulse buyers. For mixed martial arts apparel, people will choose to buy from reputable brands rather than just clicking on a Facebook advertisement and buying products they have never heard of. That was the one thing that I learned and that’s why I closed that store.
Tze was now in April 2020 and he knew it would be hard to find a job as a recent graduate, especially during a pandemic. Tze decided to continue dropshipping and to use the lessons he had learned from his eight first stores to help him in his next endeavor.
Tze decided to return to the one store that had made a profit, the plush toys store. Tze began to import as many soft toys possible. He was then blessed with a good fortune.
Right Time, Right Page, Right Niche
Tze spent a lot of time looking for products related to bubble tea back when he opened his first store. He knew that bubble tea was popular, but there wasn’t much choice. He knew that he had found the perfect bubble tea plush toys when he came across one.
“One day, I found that bubble tea plush. It was so easy to see that it would work. I had been looking for bubble tea products before I found it. It was a few days ago that I hadn’t seen it. Then, one day later, I saw it and imported it immediately. I then started running ads and it just kept going.”
Tze posted his ads online within a matter of hours and customers began to come in. Tze targeted Asian-Americans because boba/bubble Tea was very popular in the Asian community, and America was a huge market.
Looking back, he knows he was incredibly fortunate to find a new product that no one else was selling.
“Yeah, it was just luck. “I was exactly like I was at the right moment, on the right pages.”
Build a Plush Toy Empire
Tze knew that his bubble tea plush toys were the best, but he added more items to his shop. To make it easier for customers to find the right toys, he divided them into different categories such as “land animals”, “aquatic animals,” or “non-animals”. He removed the images’ backgrounds to look uniform and spent time writing unique descriptions for each product. He was proud of his efforts, even though it wasn’t easy.
“I spent two weeks a day in front of my computer, searching for products, importing them and writing descriptions. I also removed backgrounds. It was a nightmare writing product descriptions. It was exhausting to write descriptions for every product. But, it was worth it because each product is unique.
Tze was motivated to add so many products, which he ended up with over 100. He wanted his store’s plush toys to be recognized as an authority. Tze argued that you wouldn’t visit Nike or Adidas with only one pair of shoes. He was able to attract more customers who liked plush toys by having so many options, even though it took extra effort.
He made each description unique and also took the time adapting to his audience’s voice and tone, something that required a lot research.
“I had to speak as my target market would talk, which required a lot brain-bending and stuff since I don’t speak this way. It was a lot of market research, and scrolling through Facebook groups.
Tze also found inspiration in Facebook groups, such as his store name. Subtle Asian Traits’ Facebook page was so popular that Tze named his store Subtle Asian Treats.
Making the most of each visitor
Tze’s customers had plenty of options when it came to what products to purchase. The majority of the visitors were opting to purchase a single bubble tea plushy, rather than using ads.
It was wonderful to have customers. However, Tze’s average Order Value (AOV), was $15-20. He wanted to increase it.
Given he had three slightly different looking bubble tea plush toys, he created a bundle where customers got three slightly different toys. Customers only had to pay for two toys, and they got the third free.
It was instantaneous.
Customers loved it because they believed they got a third toy free of charge. Tze was especially proud that he doubled his AOV.
Tze was happy to bundle products in this way, even though it meant extra work when it came time to fulfill orders.
Tze was delighted with the success of his ads and the increase in his profits from the new bundle. However, problems soon developed.
Slow Business for Rivals and Copycats
Tze knew that he had success finding his winning product as soon as AliExpress added it to its catalog. He also knew that his market monopoly would eventually come to an end. Because dropshipping has such a low barrier to entry, there’s very little to stop other entrepreneurs from coming in and selling the same products, and soon enough, copycat bubble tea plush toy stores emerged.
Tze was able to compete after two months of being monopolized. Tze’s product descriptions and ads were stolen by others, who knew it was a successful strategy.
Tze’s market share dropped dramatically, and orders slowed down to a trickle. He had done incredible for himself, even though the boom was over.
Tze had sold 2579 products in total, spread over 2245 orders. Tze’s success was based on his knowledge of the bubble tea market and its popularity. 2041 of the 2579 products he sold were bubble tea toys.
Tze made over $100,000 in revenue during those two months. Tze spent $48,000 on shipping and goods, and $31,000 on ad spend. He ended up with around $19,000 in straight profits. On average, he made $24.57 profit per transaction.
Tze is now competing in the market and has reduced his ads. He still gets orders but it’s not enough to make ends meet at this stage.
Tze is still thrilled with his achievement, despite this. Tze launched his business with a starting budget of $3,000 and generated $19,000 in revenue. Not only that, but he did it all on his own, with no help from a business partner or virtual assistant. He has a solid record of success in ecommerce and learned everything he could on the job.
Tze didn’t consider his plush toys store a long-term venture, so he was not devastated when competitors opened. He was eager to get on with his next project, which was the launch of a new brand.
Tze and his friends have teamed up to create a premium, affordable activewear brand in Malaysia using the profits from his dropshipping business. It’s an exciting venture that is just beginning.
It’s still in the R&D stage. We are now focusing our efforts on the Malaysian marketplace because there isn’t really an activewear brand that is premium in Malaysia. There are budget brands for activewear, but there isn’t a lot of premium quality. Premium activewear is something we consider premium, like Nike and Adidas. But they are expensive so we tried to find a middle ground, offering premium, affordable activewear to the Malaysian marketplace.”
Tze hopes the brand’s activewear will offer a new challenge. Tze is confident that the brand will be a success, given his knowledge of Malaysian markets. Tze isn’t worried if it doesn’t.
“I hope it goes well. “If it doesn’t work out I’ll just find a job.”
Tze’s Takeaway Tips
Tze spent two months working in his store full-time and has some ideas on why his plush toys store was so successful. He shares his knowledge after months of failing stores and finally a huge success.
Understanding your Audience, and then Finding a Product
When talking about his winning product, Tze firmly believes that his store succeeded because he had the perfect match of a great product and knew the ideal target audience.
Boba was able to appeal to different cultures. This is one of the main reasons it worked. There were many other cute products I tried to import into my store. I also tried marketing them, but they didn’t work. Boba was a popular product that appealed to an Asian population.
According to his experience, winning products must be adorable and appeal to customers in some manner, such as through culture. He says that while it is easy to find an item that ticks all the boxes, you must also be able to appeal to many other aspects if you want to make a product that sells.
Subtle Asian Treats was a dropshipping shop when I first saw it. It looks professional and logical. This was Tze’s primary goal for the store, he said.
Using Photoshop and a background removing tool, Tze was able to edit all his product pictures, so they faced the same direction and had the same appearance. It was a worthwhile time investment as Tze could use the images in Facebook ads.
Every customer is a potential customer.
Tze wanted to ensure that every customer who clicked on Tze’s ads and landed at his site cost him money.
The “three for the cost of two” bundle was a great way to double Tze’s AOV, with little fulfillment time and no extra cost. Tze claims it’s a trick his competitors have not copied, and given the value it provided him, he feels they’ve missed an opportunity.
Cross-selling and upselling are also options. These are all tactics that can keep refunds and chargebacks to a minimum.
He was certain to have a solid refund and return policy because COVID-19 could affect delivery times. He had strategies for dealing with major delays. Customers could receive a discount on future orders or a refund after they have received their product. This was in exchange for an honest product review.
Tze also took the time to interact with customers. Tze was very active on the store’s Instagram and Facebook pages, liking and responding to all comments. He was able to build relationships with influential people and increase brand recognition. Customers never felt they were dealing directly with scammers or bots. He responded to emails and messages within half an hour.