Erin Rafferty was a multifaceted person two years ago. She was an employee of a bank. She worked as a finance manager at a car dealership. She was single and a Finance Manager at a car dealership. She didn’t know that she was about embark on a lifetime of entrepreneurship that would change her life. She was able to quit her job, travel around the country and purchase her dream home thanks to her dropshipping success.
Amazingly, Erin Rafferty’s dropshipping company managed to sell $2.3 million worth of products in just one year. After quitting her job, Erin Rafferty entered eCommerce without a safety net and has never looked back.
We reached out to Erin in December 2020 to arrange an interview, as Erin is one of the most successful users on DropCommerce. To share some of her strategies, habits, and perspectives with other dropshippers, we wanted to get to know them. We hope that sharing her story, her experience, and her lessons will help other dropshippers in our network achieve the same success that she did.
Erin was gracious enough to share her business structure, unique sales/marketing strategy, profit margins, and other details during our conversation. We heard her opinions on the top product niches in 2021, how she put together her team, and what her advice was for starting a dropshipping company for beginners.
We made it as easy as possible for you to have a conversation about dropshipping.
Below is a summary of our conversation. We hope that you find it as enjoyable as we did.
I would like to start by asking you a few questions about yourself and your life.
For sure. I was a teen mother so money was always a problem. It was hard for me to work two jobs, and I was away from my child all the time. Either he was at home with my parents or I was babysitting. Whatever, I did what was necessary. I started working in the corporate world. I worked in a bank my early twenties. It was a very respectable job.
Although I was promoted many times and everyone congratulated, inside I was still miserable. I was a terrible trader of my time for money and hated the corporate games. I was constantly pretending to be somebody I wasn’t every day, which led to office drama. It was exhausting and draining. My son was very young when I had to work, so I wasn’t able to travel. I felt that my life experiences were limited. Because I was so busy working, I felt that I wouldn’t be able to live the life that I dreamed.
It all came to an end in 2019, and I realized I couldn’t continue. So I quit. I had no backup plan and quit both my jobs. I was so stressed. My bank account had only $2000. I still had enough money to cover all my expenses so I knew I needed another job. Even though $2000 was not going to cut it for me, I tried really hard to be very picky about the job I would take. I had been so miserable at my last job. I was not interested in being involved with something I would be unhappy with for the long-term. I wanted something that would be a better fit.
Aliexpress was my first stop. I ordered a lot of ring lights. They cost me about $800, which is a lot considering the amount of money I had. However, I was able to list them on Facebook Marketplace. The response I received from these ring lights was amazing. I knew people were shifting towards the internet space and that everyone wanted to be an influencer. Because I was one of them, I knew. I sold out. I got my money back and more. It made me realize that I could order things from Asia and then sell them locally. I was familiar with the process from the first time I did it using the ring lights. My vision improved and I became more clear.
It was a thought that I had and I asked myself, “If I can sell ring light bulbs, why can’t you sell other things?” I began researching dropshipping and opened my first Dropshipping Business on Shopify. Because I was able to relate to the customer, my first store was in women’s clothing. Because the customer was me, I knew that I understood the customer.
I was lucky to never get another job. Since then, I have been doing this job. I opened the first store and then I started another. I have since closed two and opened six more. Our first year’s total revenue was $2.3 million (in 2019).
What role did your previous work experience play in your dropshipping success?
My corporate jobs included a position as a finance manager at a dealership and a bank. My background is in finance. I was able to understand the basics of money. You don’t really work in finance if you work at a bank. Instead, you work in sales. I attended many corporate summits, conferences and seminars about how to manage sales, overcome rebuttals, and push for upsells. I gained a lot of knowledge about the mental side of marketing. How to control a conversation mentally to achieve the results you desire. This is something Corporate America/Canada can teach you. That was what I believe contributed to my success with marketing and sales.
How did you approach stuff you weren’t familiar with?
Everything was done by me when I started. I followed the steps and Googled which platforms were available. I started with Ecwid. Although they were free, I soon realized there were limitations to building my store. I switched to Shopify quickly and went through it slowly.
I started slowly and kept asking myself “What’s next?” So I created an account and chose a domain. Then, I kept asking myself “what next?”. Youtube became my mentor. Every time I was unsure about something, I would use Youtube to help me understand it. That became my daily task. That was what I did every day. The first thing I did was to implement it. Next, I did some research. I then implemented the item, followed by more research.
What have you been able to achieve with your success?
It has completely changed my life. Because my business is eCommerce and dropshipping, I am not restricted by where I live. I have been able take my mom on a trip through Europe. I won’t give up my time for anything. The house of our dreams was just purchased. One year was spent living in an RV and driving across Canada. My family is more fortunate than I am, and so is my life. My life is completely different.
I no longer have to get up at a specific time. I can wake up whenever I want. My schedule is set for every day. There are daily tasks that I must attend to in my dropshipping business. I only have an hour of work each day. The rest of my day is free for me. My now-fiancee (we are engaged) doesn’t need a job. He used to sell cable door-to-door in the middle (Canadian) winter. Now he supports me and works for me. He is able to stay at home and care for our family and household.
So I have mentioned the travels, the house and financial freedom. However, my dropshipping success has allowed me to expand into other industries. I own real estate properties and have an active investment portfolio. I have been able diversify my wealth in ways that will last me the rest of my lifetime. Overall, I’ve made decisions that I never thought were possible in my life. It’s been amazing.
You stated in the past that personalized sales conversations were your primary method of marketing. What does that look like?
Yes. Our strategy was to create what I call “magnet content”, and it is still our strategy today. If I was selling pet stuff, for example, I might write an article called “Ten steps in obedience training your dog” or something similar. The article would be packaged into an Instagram post. It doesn’t have to do with my products but it helps me build credibility. Sometimes I’d reach out to people and say “hey, have you seen this article?”. Then I would find a random article about obedience training for golden retrievers. This is done to establish rapport with the customer. This is not a sales conversation, but I am just reaching out to them as a regular interaction via social media.
Next, we create a flowchart that records all messages and responses. If that person continues to engage, then we will reach out to say, “You know what, we know you follow us and love your content. We think your dog would look so cute in this outfit. Would you be interested in 20% off your purchase? Would you be open to the idea? We get a very positive result from such conversations.
Sometimes people say “Well, we have a tight budget.” We’ll tell you, “You’re right. How about 30% off?” Or 35 %?”. We basically offer you a discount incentive. Would you mind if we sent you a discount for our products? This is the entire strategy.
Do you think your marketing strategies have changed now that you have at least 3-4 stores? To reach $2.3M in sales, it must take a lot of conversations.
It is so many conversations. Now, I have employees who are working in our inboxes and on other Instagram accounts. They are still marketing and are also working. These personalized, human-to-human sales conversations are done by my employees. They are paid an affiliate commission for closing sales. If I were Erin, I would be like “oh cute golden retriever” and go in. After some banter, I would say “here, my code discount code is “Erin10” to them. This allows me to track who made the sale that day. As an affiliate, I get a percentage of each sale. It was a complicated system to streamline and requires a lot of work.
When did you start to organize everything in your dropshipping company?
It was the Women’s Clothing Store when I started it. I did what I knew, which was to talk and have sales conversations. My Instagram was my only platform. I felt like I was just grinding out content. Then someone would respond and I would say “Oh hello, Erin, this boutique is mine.” Is it something you like? I wanted to have human-tohuman interactions with these people and would record the results in an Excel spreadsheet. Because not everyone was open to sales, I kept track of which conversations led to sales. We had people who were like, “hey screw you, get me out of your inbox!”
I created a long-term flowchart that tracked which conversations were successful and failed. It was easy to tell people when they hired me that this was step 1, step 2, and step 3. These are the rebuttals I can expect and how to handle them. It was a simple flowchart of how to convert through discussion.
How did it become a great time to start a second dropshipping company?
I wanted more results and knew it. Because I was already full-time working, I had the time and money to invest in this marketing system. Once I had a system of marketing that worked, I was able to implement it in any niche or product. In my coaching, I always advise that you start backwards. First, you need to determine your marketing strategy. You must first understand your target customers. Next, you need to test and implement your marketing strategy to market to them. Finally, you can start building your store. Without a solid marketing strategy, you could spend so much time building your store that you lose sales and conversions. It worked for me, and I was confident that I could adapt it to other markets.
How did your company hire its first employees?
A remote working group I found on Facebook had approximately 26,000 members. There were also a lot of people who wanted to do alternative work. Many of them were disabled, while others wanted to work remotely. This was not a common practice back then. I posted a message saying “Hi, my name is John, I’m a shop owner and I manage a boutique. These are the jobs I need.” I need your help to write product descriptions or interact with me on Instagram. I would also source people from the group to hire them as freelancers. To protect both sides, we would negotiate a rate and send each freelancer a contract. Each freelancer would be responsible for their taxes. My girls were mostly American, but some were Filipino and others were from around the globe.
Dropshipping is often criticized for not being very profitable. How was your profit margin after all that discounting?
So our profit margin for $2.3M was 35%. That’s $800,000. No matter what business you are in, 35% is an excellent profit margin.
I hear that all the time from people. It all comes down to what marketing strategy you choose. Your prices are your responsibility. Your customer must believe that your product is worth the price. No one else can tell you what price to charge. Dropshipping can bring in good profits if your system is designed in a way that allows it.
How do you create your listings? What about the photos and descriptions of the products that the suppliers offer?
Yes, at the time I started my business, I didn’t have much money. That was why I needed to find a solution. Because I knew customers could back-search the photos, I decided not to use them. My suppliers could be found by simply Google-searching the images. To mitigate this risk, I encouraged people to send me photos of themselves using the products that they purchased from me.
In return for photos and content, I would initially send products to people. If I had a larger budget, however, I would definitely do professional photo shoots of the products. Professional photography is essential if you want a beautiful, fully-developed website. Your product photography should reflect your brand’s aesthetic. This is a great piece that will help your store stand out. It was not something I could afford when I started but I do believe I would have it now if I could.
We rewrite product descriptions ourselves. We take the majority of the information you provide in the DropCommerce product descriptions and adjust them to match the tone we want on our website.
What were your first impressions of DropCommerce when you first used it?
Dropshipping is selling products from Asia or similar products. They also have longer shipping times and lower quality. It has been difficult to find a manufacturer in the United States or Canada. I was shocked to learn that DropCommerce does not send products made in the USA or Canada. I was so happy to visit you guys.
Initial impressions were positive. It’s simple to use and intuitive. Your product descriptions and product photos are amazing. You also cover a wide range of product categories. Overall, I was impressed when my first start.
One thing that I might say is that dropshipping can be expensive. However, I recommend you guys to students a lot. I say “yes, it’s higher quality, but the price is still high” and that you will be targeting a more wealthy customer with your marketing. The platform is great. It’s very easy to use, and smart.
What would you say to a friend who asked you whether DropCommerce should be used to power their dropshipping company?
I would answer “yes” DropCommerceem >!”. You’re guaranteed to receive a better quality product because there are so many unique products. You will have quicker shipping times and be able to sell Canadian and American-made products.
The best thing about the platform is the fact that I don’t feel that there are ethical concerns with the products I send my customers. This is something I believe the market and consumers are striving towards. People want to know the origins of their products, as well as who made them and how they were produced. These are not concerns that I have when I am working with DropCommerce. I don’t need to do much digging. It’s important to me that you choose ethical manufacturers.
Have you read any books, watched any movies or listened to any other media that helped you make the leap towards entrepreneurship?
Tim Ferriss’ 4-Hour Workweek is a must-read.
You can also watch the Nasty Gal documentary series on GirlBoss. It’s available on Netflix. This was also very inspiring to me. It’s basically a true story about a woman who is extremely poor and going through difficult times. There’s also a lot of negativity in her life. She loves thrift shopping. She found a jacket she believed was valuable and, after falling on hard times, put it up for sale on eBay. She got a massive return of about $800 and it was a turning point in her life. It turns into a multimillion-dollar business called Nasty Gal. It was a show that inspired me, and I can still remember watching it in my apartment with my child. Yes, Tim Ferriss and The Nasty Gal miniseries (“GirlBoss”)
As you mentioned, you have trained many people in how to run a dropshipping company. What are the biggest mistakes you see people make?
This is a simple one, but it’s a complicated general store. Dropshippers are marketers. A marketer is not necessarily a product designer or something like that. It becomes a lot more difficult to market to everyone when you have a general shop. You won’t be able market to everyone if you try to appeal to everyone with your general store. This is a huge mistake.
Dropshipping is a popular business model that many people believe will make them rich quick. You can achieve amazing results, just like I did. But you have to put in a lot of work. For the first six months, I worked 16 hours a day before I saw tangible results. Although we had some sales, it was not enough to replace my full-time income. Dropshipping is not easy. If you aren’t ready to put in the work, you will be setting yourself up for failure.
A person from the corporate world would like to dropship or go eCommerce, but they aren’t ready yet.
It’s a great question. I have thought about it many times. This is what I always tell people: “If you want to become an internet entrepreneur, then stop using the internet for entertainment and begin using it as an education tool.” There are many ways to do this. Use content that’s good for you. Follow people who are educated and have the same success as you. Be objective, however, about the internet.
If you are looking for something on the internet, whether it’s a viral post or an advertisement, don’t just look at it as a cool product. Ask yourself why this went viral. What made this company pay so much money to put this post in front me? You need to be objective about the information you see on the internet. Ask yourself “How much did it cost me to get this post in my mailbox?” It converted because of this. It caught my attention. How does the company’s back-end look? How many steps did the company go through to get me this information? You can start to understand how these cycles work by being critical of the content you see.
When you’re ready to put them into practice, you will have a clear picture of where you stand and where you need to be focused.
Which niches are you most interested in and least saturated?
Arts & Crafts is my choice. Arts & Crafts’ average conversion rate is 4.8%. That is insane. People are also bored at home. It’s definitely on-trend for 2021, I believe. I am here to open an arts and crafts store.
Although sustainable products are a great alternative to dropshipping, they can present some challenges for dropshippers. These products are an alternative to single-use plastics like shopping bags and reusable straws. They are a big part of my business, so I have a whole shop dedicated to them. Dropshippers are not able to choose their packaging. This is the problem. If you talk about single-use plastics and ship your orders in plastic mailers, it can make you look hypocritical. Although there are challenges, I believe there is still potential.
Would you do something different if you had to start over without your stores or social media accounts?
If I were to start over, I would totally skip overseas manufacturing. I would totally skip Aliexpress and move to American-made products or shipping facilities right from the beginning. My first store, women’s clothing, had to be closed due to long shipping times and poor quality. My store was ravaged by bad reviews. It was heartbreaking to close the store as it was my baby. However, it is always a good thing to look back.
Looking ahead to 2021, what would you like to share with people thinking of starting a dropshipping company?
Dropshipping is possible even if you feel it’s too saturated or too done. It’s up to you to think creatively about how you approach it. The traditional “pick a product and create an ad on Facebook to hope for sales” approach may not work. However, there are many ways to start a dropshipping company. There are many ways to be creative.
It’s just a supply network. Don’t let it get you down. And don’t be afraid of trying to grab your own piece of the pie if it seems oversaturated. I’d rather have a small piece of a large pie than nothing.
End of the story
Wow!
We hope you found some value in it. We sure did.
Dropshipping is something you can try if you are interested. Dropshipping is easy with over 20,000 products available. Our app is accessible on Shopify and BigCommerce. You can rest assured that our products are only available from North American suppliers. To browse our products, you can either sign up for a complimentary account or get a 14-day trial. You have the option to make your own decision and we are here to help you along your entrepreneurial journey.
