Choosing the Right Products at the Right Time

March 21, 2011 How to Sell Online

If you are selling products online you may be under the impression that after you find a suitable drop shipper for you business needs all you need to do is simply sell products. However, the reality is that without proper product planning, your profit margins will quickly decline as all products have a limited life span.

Products that are wildly popular and successful today could quickly lose their appeal in a moments notice. It is because of this universal truth that you must constantly phase out old, outdated products and continue to launch new and innovative products to your customer base.

Study Your Product Performance Metrics
In the beginning stages of a life cycle for any product, demand is generally at its highest point and the supply rarely keeps up with demand. This causes the product to sell at a premium at you will generally find that it is difficult to gain traction at this stage as most retailers make the bulk of their profits in the competition stage.

As competition and supply increases, the prices of products will tend to fall and product sales stabilize. As this stages come to a close, the demand will begin to fade away as the product inevitably moves towards the decline phase of the product cycle.

The demand for a product can decline for numerous reasons, be it that it is no long stylish or in season. Demand can also falter due to increased competition that drives prices to a level that most retailers are unable to compete. As you begin to notice the trend of a declining product, you must begin to offer your customers a new product immediately or suffer the consequences of diminished profits.

Pay Attention to Decline Signals

Market research will always precede product selection if done correctly. You have to ensure that you are selling the products that your customers want when they want them. Product selection is generally dependant upon the following:
• Demand: If you wish to research the demand for a particular product, the best way to do this is by researching the number of users searching for the product online for a give period of time. Once you get a feel for the search volume, you would then research the average selling price of the product to determine if you would be able to compete in the marketplace with the wholesale pricing from your drop shipper. You can use Google’s free Adwords Keyword Tool in order to research the monthly search volume of any product of your liking.

• Direction: You need to establish the direction of your products in order to determine which direction they are headed. If you notice that a particular product is headed towards the declining stage, it makes little sense to continue to stock this product and not search for a new marketable product.

Overall, you must be aware that your entire product line will constantly be at different life cycles at different times and it is extremely important that you pay attention to the different stages so that you can ensure that your business is offering its customers the right products at the right time.

drop ship product Drop Shipping dropshipping Good Marketing internet marketing Niche Marketing Strategies online business selling online

Choosing the Right Products at the Right Time

Inspiration

About