512: My Predictions For Ecommerce In 2024 | The Good, The Bad And The Ugly

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You’re listening to the My Wife Could Her Job podcast, the place where I bring on successful bootstrap business owners and delve deeply into what strategies are working and what strategies are not with their businesses. That’s the beginning of the year. And unlike other years in the past, I think we are in store for a hell of a lot of changes in 2024. So in this episode, I’m going to give you all of my small business predictions for this year. But before we begin, I want to let you know that tickets for the 2024 Seller Summit are now on sale over at sellersummit.com.

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The Seller Summit is the conference that I hold every year that specifically targets e-commerce entrepreneurs selling physical products online. And unlike other events that focus on inspirational stories and high-level BS, is a curriculum-based conference where you will leave with practical and actionable strategies specifically for an e-commerce business. Every speaker I invite is deep in the trenches of their business, entrepreneurs who are importing large quantities of physical goods, and not some high-level guys who are overseeing their companies at 50,000 feet.

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Now I personally hate large events, so the Seller Summit is always small and intimate. Every year, we cut off ticket sales at around 200 people, so tickets sell out fast, and we’ve sold out every single year for the past eight years. Now if you’re an e-commerce entrepreneur making over $250k or $1 million per year, we also offer an exclusive mastermind experience with other top sellers. The Seller Summit’s gonna be held in Fort Lauderdale, Florida from May 14th to May 16th, and right now, this is the cheapest the tickets will ever be.

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Also, if you haven’t picked up my Wall Street Journal bestselling book, The Family First Entrepreneur yet, it’s actually available on Amazon at 38 % off right now. My book will teach you how to achieve financial freedom by starting a business that does not require you to work yourself to death. Plus, you can still access my free bonus workshop on how to sell print on demand and how to make passive income with blogging, YouTube and podcasting when you grab the book over at mywifequitterjob.com slash book. So go to mywifequitterjob.com slash book.

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Fill out the form and I’ll send you the bonuses right away. Now onto the show.

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Welcome to the My Wife, Gooder Job podcast. In this episode, I’m gonna give you my predictions for e-commerce and small business entrepreneurship in 2024. With 2023 behind us, I’ll dive into what’s next, discuss everything from the shifting landscape of e-commerce jobs to artificial intelligence. Now, my first prediction for 2024 is that small ticket drop shipping is gonna die. Now, when I say that drop shipping is gonna die, I’m not saying that people aren’t gonna continue to try doing it.

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but anyone who tries dropshipping $10 to $20 products from places like AliExpress or any of the other China-based dropshipping apps will simply not make enough money to make it worth the headache. Now here’s what most people don’t realize about dropshipping from China. One, the quality control is terrible, and a lot of times, your customers are going to be shipped poorly packaged junk that is broken on delivery. Lots of your orders are also going to get lost in the mail or take months to arrive. And as a dropshipping store,

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you are the one responsible for customer service. Even though you aren’t carrying any inventory and your startup costs are super low, you will still be wasting a ton of your time dealing with customer complaints and refunding people’s money. Now these low profit margins simply aren’t worth your time unless you were just using dropshipping as an exploratory mission to figure out what sells. Now the only way to succeed in e-commerce in the long run is to sell a private label product. A product with a strong brand

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that allows you to charge premium pricing. Otherwise, sites like Tmoo are just going to eat your lunch. Now, if you’ve never heard of Tmoo before, Tmoo is an online marketplace that ships cheap junk directly from Chinese factories at much lower prices than you can ever charge with a drop ship product. As a drop shipper, you’re just a middleman and buying direct from the factory will always be cheaper unless consumers have a reason to buy from you. So for example,

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A t-shirt drop shipped from a US store will cost a customer between 20 to 25 bucks. But the exact same shirt from Tmoo only costs $7 and includes shipping. So basically no one’s going to pay 3X the cost for the exact same item. Which brings me to my next prediction. Tmoo is going to continue to grow like crazy and basically destroy unbranded commerce. At the time of this recording, Tmoo’s 2023 numbers aren’t out yet, but I can tell you

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that in just one short year from November 2022 to April of 2023, they were able to attract about one third the traffic of Amazon and what’s the top downloaded app in the app store. So mark my words, that number is going to grow exponentially. Tmoo is throwing millions of dollars at influencers and gaining traction fast. In fact, Tmoo is already hurting Amazon big time. According to Amazon reps, the apparel side of Amazon is down 30 % year over year.

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and sites like Timmu and Shien are eating their lunch. Now to further fuel the fire, Americans are facing a record amount of credit card debt. And according to LendingTree.com, Americans total credit card balance is 1.079 trillion as of Q3 of 2023, which is easily the highest since 1999. Now according to CNBC, more than 62 % of Americans are living paycheck to paycheck, and more than half the Americans that earn over 100K

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are also living paycheck to paycheck. So as a result, American households had to make tough choices because their finances are stretched super thin by high prices for goods and services. So mark my words, because of these two factors, people are going to flock to Tmoo in 2024. And again, if you are selling unbranded or commodity products in 2024 or drop shipping other people’s products, you’re just going to get squeezed out. All right, let’s switch gears now and talk about selling an Amazon.

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Amazon literally just announced their biggest price hike ever. And to make things worse, their pricing is super complicated to figure out. Now, probably publish a separate episode on whether it’s worth it to sell on Amazon FBA in 2024. But here is a synopsis. Starting in March of twenty twenty four, Amazon will now charge you a placement fee for every item shipped between twenty one cents to sixty eight cents for standard size products and two dollars and sixteen cents to six bucks for an oversized item.

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This is a brand new fee on top of what they were already charging you. Not only that, but they are now charging you an extra fee if you do not have at least 28 days of inventory in stock. Now, remember, Amazon already charges you hefty fees if you have too much inventory in stock. But now you’re to get charged for having too little in stock as well, which I find ridiculous. Now, in order to use Amazon FBA and not incur extra fees, you have to walk this tightrope.

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where you have to have just the right amount of inventory in their warehouse. If you have too much or too little, you’re going to get screwed. And trust me, I’ve been managing my own warehouse over at bumblebelyndons.com for 17 years now, and inventory forecasting is very challenging. So my prediction for Amazon in 2024 is that these new fee increases will weed out a lot of the casual Amazon sellers. To make money on Amazon in 2024 requires that you know what you are doing.

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from both a marketing and a supply chain standpoint. Now I’ve been saying this since 2016. If you want to succeed in e-commerce, you must have your own website in addition to Amazon and work on building your own traffic and your own brand. Now the problem with Amazon is that it’s like a drug. Amazon has a ton of eyeballs and it’s fairly straightforward to generate sales on the platform if you know what you are doing. But figuring out exactly how much profit you are making at the end of the day,

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And keeping track of all the Amazon fees is actually the hard part. When you log into the Amazon dashboard, Amazon purposely only shows you your revenue numbers front and center. But in order to find your fees, you have to dig through piles of reports that are hard to piece together. There’s refund fees, FBA fees, return fees, PPC fees. You have to really know what’s going on. So bottom line, these new fee increases for 2024 are huge and lots of existing Amazon sellers will go under. By the way,

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If you’re a current Amazon seller, do yourself a favor and download the Sellerboard app, which will tell you your net profit. If you haven’t done this already, it is an eye-opener. Now, selling on Amazon gets more more expensive. My next prediction is that content will become crucial in making any type of business successful. The days of throwing up random products on Amazon and making good money are over. And as I alluded to earlier, you must build a brand. And the only way to build a brand is by creating content.

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You must put yourself out there. And this is why I heavily invest in my blog, my podcast, my YouTube channel, social media and TikTok. Now the simplest way to build a brand is to just show your face as the owner on video. All you have to do is film short form videos of the day to day of your business. All you have to do is be transparent and the customers will come. Because when it comes to running any business, people tend to buy from who they like.

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Now the clearest example of this is with my online store course over at profitableonlinestore.com. There are hundreds, if not thousands of people teaching e-commerce online, but people buy my class because they resonate with my story or my teaching style. With strong content and a brand, the price point matters much less, and once you have an audience, you can literally sell anything. And this is exactly how you beat Tmoo.

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So basically if you want to succeed in 2024 with physical products, digital products, or basically any product, you must create content, whether it be with a blog, podcast, YouTube, or social media. All right, let’s switch gears again. My next prediction for 2024 has to do with hiring and outsourcing. I belong to several mastermind groups and regularly keep in touch with a number of online business owners. And almost all of them are now hiring their best employees

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exclusively from outside the United States. Every single job from content writing, social media managers, virtual assistants, developers, everything can be easily outsourced to cheaper labor elsewhere. And even though outsourcing has been happening for quite some time now, the trend that I’m seeing in the past year is that more more skilled labor is being outsourced. Now, we’re not talking about just virtual assistants anymore, but we’re also talking about content creators, managers, engineering directors, developers, you name it.

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And the equalizer here, especially in the content space, is AI. A couple years ago, I used to pay a premium for writers in the United States because native English speakers generally produce better content. But thanks to ChatGPT, I’ve shifted nearly all of my writing staff to overseas at a fraction of the price. And here’s what I found. The problem with most overseas writers in the past was that some of their sentences were grammatically incorrect or they just sounded awkward when read by a native English speaker. But now,

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All you have to do is have them feed their content into ChatGPT and just have AI clean up the content. AI is a game changer in that it turns anyone into a fairly competent content creator. And the same is true for Amazon sellers. Chinese owned listings on Amazon are now nearly indistinguishable from US listings because of ChatGPT, which has drastically leveled the playing field. In the past, it was obvious to spot the Chinese sellers because their copy was really bad.

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But now Chinese sellers can create high converting listings without having a strong grasp of the English language. Not only that, but as the factory, they also have the advantage of lower pricing. But what’s most disturbing about all the mass outsourcing is that I fear for the US economy. US labor is just too expensive and it doesn’t make much sense to pay more for lower level US employees when there’s someone in the Philippines or Bangladesh willing to do the exact same work for 3X less.

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At some point, this dam is gonna break. I reckon number of Americans are already living paycheck to paycheck and it’s only gonna get worse. Will the government step in? I know that the minimum wage here in California just keeps going up and ironically, I think it’s only making things worse because why would I pay someone in the US $20 an hour when I can find someone just as good or better for just five bucks an hour? Which brings me to my final prediction. AI is gonna replace a lot of white collar jobs.

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AI is moving so fast that it’s hard for me to predict exactly how it will affect society as a whole. But what I do know is that almost all my engineering buddies here in the Bay Area are working at AI startups. And not just software startups, but hardware as well. Right now, AI computations are mostly performed in the cloud, but powerful AI models will soon run on phones and laptops this year. Now, you’ve probably heard terms like the singularity or AGI being thrown around the AI space.

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And I think we’re already pretty close. I used to pride myself on being a pretty decent developer, but you know what? My last coding project was pretty much 80 % coded by ChatGBT. And I had ChatGBT ask me questions on exactly what I wanted, and we kind of iterated back and forth. And you probably just noticed that I referred to ChatGBT as a person just now. My buddies in Silicon Valley are already scaling back hiring for junior engineers because ChatGBT is making existing engineers

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so much more productive. As soon as AI can start developing and thinking on its own, the sky’s the limit. Well, we really need low-skilled labor anymore. Why hire a bunch of low-level engineers when you can simply hire a couple of super engineers and augment their work with AI? Which brings me to my final, final prediction. 2024 will see the most amount of spam and misinformation than any other year combined. Right now, Google has a content problem.

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Webmasters are churning out a record amount of AI-generated content, and Google can’t tell the difference. In 2023 alone, Google released four core updates back-to-back to combat AI content, but I think it’s fighting a losing battle. Going forward, I believe that sites with the best on-site metrics will rank the highest in SEO, if SEO is even a thing towards the end of 2024. Meanwhile, on YouTube, tools like in-video.ai and Rizl

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or allowing people to churn out millions of faceless AI-generated videos in a short period of time. Now, a lot of you guys listening to this are probably on YouTube. Take a look at your homepage right now on YouTube and let me know how much AI content you see. Right now, I’d say that my recommendations are 10 % 20 % AI-generated video. This is only going to get worse. Even on Amazon, people are using AI to publish hoards and hoards of e-books. And on that note,

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I wouldn’t be surprised if AI influencers become more prevalent in 2024. According to ArsTechnica.com, fictional influencer Etana Lopez is followed by over 200,000 people and charges $1,000 a post to promote products on social media. Now, will humans even be able to tell the difference between AI influencers and human influencers in the future? Who knows? And unlike other years, 2024 is going to see a sea of change in small business entrepreneurship.

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and you’ll either have to adapt or you’re just simply going to go out of business. Hope you enjoyed this episode and that it helps you prioritize your 2024. For more information about this episode, go to mywipecoderjob.com slash episode 512. And once again, tickets to the Seller Summit 2024 are now on sale over at sellersummit.com. If you want to hang out in person in a small intimate setting, develop real relationships with like-minded entrepreneurs and learn a ton, then come to my event. Go to sellersummit.com.

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And if you are interested in starting your own eCommerce store, head on over to MyWifeQuarterJob.com and sign up for my free six day mini course. Just type in your email and I’ll send you the course right away. Thanks for listening.