High Ticket Dropshipping: Make More Money With High Margin Products?

Today we are going to discuss high ticket dropshipping.

In case you're not aware, this model involves dropshipping expensive, high ticket items compared to the traditional model of dropshipping low-cost, inexpensive products.

The main difference between these two is the price and how much commission you will make. It's obvious if you sell an expensive item like a Scooter compared to a Tomato slicer you are going to make more money selling the Scooter.

The thing you have to realize though is that in order for someone to make a purchase for a high ticket item, you're going to have to convince them that your Scooter is the best scooter available and at the best price. 

This will require building up a lot of trust and most likely retargeting ads, a sales funnel or even a series of emails to convince them to buy. The message behind what I am saying is that high ticket items are NOT impulse buys and take much more work.

It takes a lot of convincing on your part in order for someone to make a purchase for ANY high ticket item. In other words, there's much more work involved.

Comparing it to Low Cost Dropshipping Items

A low-ticket item such as the example I gave with a tomato slicer is going to take much less work to get your customer to add it to their cart and make that purchase.

The reason for this is because all the products you sell on your "low cost item dropshipping store" should all be interesting and unique cheaply priced products. 

When you create your ad, people should be intrigued by the image and want to know more about it, clicking to your store to check it out more.

If you can show how cool and inexpensive this item is and it's something they 'think' they need, there's a good chance they will make that impulse buy.

I'm sure you can understand this yourself, as likely you too have made an impulse buy on a product for like 10 or 15 bucks just because it was cool and also served a purpose or solved a problem.

In this case, if you hate chopping tomato's, then this tool is a must have and you can get it for 10 bucks. That's an easy sale and chances are you aren't going to shop around for a better price or product.

Doing the Math

On most high ticket items the profit is around 10-30%. Let's say you make 30% on this Scooter and the Scooter retails on your site for $1500. If you make a sale, you will pocket $450 for that one sale. Not bad at all.

On the flipside, the tomato slicer is going to sell for $10, your cost is $1.13 so you will make $8.87 profit on each. Obviously other costs have to be factored in but just giving you gross profits in both examples here to make this clear.

So you'll need to sell at least 50 tomato slicers to reach the profit of the scooter. 

Psychologically you may think that selling one item is easier than 50 right?

This is simply not the case because of the amount of effort and marketing that goes into making a high ticket sale. People do their due diligence when researching products like these and the chances of them coming back to your site to make the purchase is slim.

Not to mention they can go visit a shop in person that carries a similar or exact same item so they can check it out personally before making a decision.

This is why impulse buys work so well. People aren't thinking when making purchases like these. Since it's cheap and cool and something they feel they need, they don't think twice about whipping out their credit card.

So when you do your targeting with your Facebook Ads for example, just by targeting people that like to cook + eat healthy - you're going to reach a massive audience that might find this item interesting and make that impulse purchase.

Impulse purchases is what makes people a lot of money in dropshipping.

Since selling a high ticket product is not an impulse buy - you're going to have a lot of difficulty not to mention a lot of money spent on ads.

You will also be going up against large retailers that have already built trust. If your brand is new and you haven't put much money into promoting your brand, it's going to be that much more difficult to sell a high ticket product.

This is why you really should be focusing on impulse buy products instead.

Comparing Start up Costs between Low and High Ticket Offers

If you set up your store and manage to make a sale on a high ticket dropshipping item, you're going to have to pony up the $1050 or whatever the item costs before getting paid. If you're dealing with a paypal payment for your sold item, that could take weeks. 

So you better have a good stash of cash on hand to pay for these items in advance. With low-cost dropshipping, paying a buck or 2 for items before receiving your money is much easier and requires less capital for start up.

Seeing the Bigger Picture

I hope by now you are getting the message loud and clear. I realize the appeal to making a lot of money on just one product - I get it. I just can't recommend this style of dropshipping because it's just too difficult. Unless you have a powerful brand, people are not going to trust your store and will make their purchase elsewhere. That is the reality.

Your Best Alternative to High Ticket Dropshipping

There really only is one - you guessed it - low ticket dropshipping. With this strategy you are going to find cool products that people just need to have, especially since they are going to be cheap. They won't need to research it or hesitate, they'll just buy from you.

Of course building up your brand helps, but that's something you need to be doing anyway to become successful and it's not as hard as you think.

If you are new to dropshipping and i've convinced you that high ticket is not the way to go, then my next suggestion is to make sure that you build a business where you have the best chance possible to succeed.

Your next step? Check out my post on the best dropshipping course.

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Drew Mann