Yuliya Chernykhovskaya and Mike Pavlou are committed to doing things differently.
This entrepreneurial couple from New Jersey are the owners of an accessories e-commerce store, built using the dropshipping business model. While building their business, they’ve made a point to ignore much of the traditional advice for dropshippers.
And the results so far? Pretty exceptional.
They’re only a year in, but so far they’ve had over 10,000 orders and built a band of 40,000 loyal followers across their social profiles. Oh, and I haven’t even mentioned the $200,000 they’ve made in sales revenue.
It’s clear that whatever Yuliya and Mike are doing, it’s working.
I got them on the phone to pick their brain and discover the secrets behind their success. We spoke about their focus on people over products, the unspoken benefits of giving back, and the moments they felt like giving it all up.
How did you get into dropshipping?
Yuliya: My background is as a health coach and business consultant, but I always wanted to start dabbling in e-commerce. Last year we started a subscription box, and we liked it, but we didn’t love it, and we actually ended up selling that business.
Then a friend mentioned to me dropshipping, and I was like, “Yes!” because the thing about e-commerce that most intimidated me was manufacturing products and holding inventory.
With dropshipping it was so great because you don’t need to take care of that, you just focus on marketing and sales and building the brand. That was everything I loved, so it all fell together at the right time.
Mike: Before this business, I was finishing up school – I’ve just completed my PhD. And before that, we were both working on the subscription box together.
What’s this subscription box business? Tell me more!
Mike: It was called NeuroBox, it was a brain focused monthly subscription box. So it was all about positive brain health, mindfulness and things like that. We had that for about six months. We sold it to someone else and it’s still operating.
What was your motivation for starting your own e-commerce business?
Yuliya: I think for me, one thing that I’ve always really wanted was just to have time and location freedom. And what ended up happening with my coaching and more service-based businesses is that I felt like I was more “self-employed” versus being a business owner.
I love Tony Robbins, and one of the things he talks about is being a business operator versus a business owner. When you’re a business operator, you can’t leave the business. If you leave the business, it doesn’t run. If you’re a business owner, you don’t need to be there for the business to run. That was one of the biggest drivers of me wanting to start e-commerce.
With dropshipping I didn’t need to be there to make it run. If we wanted to, we could outsource customer service, and we could outsource our social media management once we’ve structured a vision and the mission of the brand.
How did you decide on your product niche?
Yuliya: We chose a niche and a store that I already had a lot of interest in. In the past, we tended to make things over complicated, and we’d have this super advanced business plan. So I said, “Let me for once make it really easy. I like these type of accessories, and I like this type of focus, let me just combine those and turn it into a store.”
Mike: Yeah, I think that with a niche that you’re so familiar with, you’re very familiar with the language and how to reach an audience like that. You know what they’d respond to. It really helps with brand building. When you can just speak to the audience really easily, that helps a lot.
Is this a lesson you took from your first business?
Yuliya: Definitely with the subscription box, we did overthink it. If we had simplified it a little bit more, it would have been a lot easier to market. We tried to speak to a lot of different people and ended up speaking to nobody. With the store we have now, we’re speaking to a very specific type of person. In a way, the fewer people you try to speak to, the more people you end up attracting. A simple message makes the marketing a lot easier, and it makes scaling a lot easier.
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How do you find products that will sell?
Yuliya: We just always test products to see what our audience responds to. We run ads so we can get those results quicker and then just follow the numbers.
Sometimes we’ll choose a product, and we’ll be like, “Oh my god it’s so cute, I really want this product to sell,” and then it doesn’t. So if it doesn’t, stop spending money on it instead of being like “Argh, I really loved this product!”
And sometimes we’ll sell a product that I think isn’t great, but people love it, and people buy it. I think that it’s important to keep testing and really let the numbers dictate your actions, rather than your emotions. Even if a product was doing really well in the past, but it’s not anymore, kill it. No more.
Do you have a lot of products in your store or only a few?
Yuliya: Want to hear a funny story? A lot of time, the advice that I had seen was to have a lot of products in your store, so at the beginning that’s what we did.
Then February hit, and it was Chinese New Year. That was our first dropshipping Chinese New Year, and we didn’t know that everybody shuts down. So all of our suppliers, except for two of them, were gone and off the radar for three to four weeks. So our store had a significantly smaller amount of items in it, and what ended up happening was our conversion rate actually skyrocketed.
I mean, there’s been a lot of studies in psychology that even though people say they prefer more options, they actually act when there are fewer options.
Mike: Yeah, less is more for us.
Yuliya: That’s why we add new products often, but not a crazy amount. We really test them, and if they work we keep them, and if they didn’t then we just never keep them on for longer than a few weeks.
What has been your main marketing strategy?
Yuliya: I think a lot of dropshipping businesses feel like they have to be really winning products focused, or just products focused. For us, it’s worked to not be like that and to be really focused, really people focused. For us, it’s first about creating content and a brand that people love, and to say “Hey and by the way, these are our products, and they just so happen to be dropshipped.”
With this style of business we’ve created, we could do dropshipping, or private label, or manufacture our own products. It doesn’t really matter because we lead with the brand. That definitely gives the business more value and longevity.
Building a brand is tricky though, what do you think owners should focus on?
Yuliya: I think there are two main things. Number one is to define what the vision is for the brand. What is the one single message that our audience can really resonate with? That’s number one.
I think number two is, and I’m graphically challenged so I’m surprised that I’m saying this, is to have a visually coherent brand. Having the same colours everywhere, the same font everywhere. That looks really professional. I think that builds trust right away. If you have a brand that doesn’t look seamless and put together, I think that kills you right there.
Mike: I would say really good customer service is a huge thing. We get the most raving fans when we do something that’s very over the top customer service. That’s when we get the biggest repeat buyers. They end up telling their friends, and it ends up becoming much more of a brand and not just a store.
Yuliya: Yeah, we’re really relationship focused. From our customer service to our funnels – our welcome sequences and our abandoned cart sequences. We really try to focus on building relationships. Which seems counterintuitive for a product based brand, but because of that our conversion rate is through the roof. 9% of our abandoned carts are recovered, and we’ve been as high as 15%. Our conversion rate on our site can be between 5-8%. The industry standard is a little less than 2% I think. And those figures, that’s honestly just a side effect of all the stuff we do to build that brand loyalty.
Thanks to a focus on great customer service and targeting engaged audiences, Yuliya and Mike have seen their conversion rate grow and grow.
What does exceptional customer service look like?
Yuliya: We really try to make a customer feel heard. Let’s say an item arrives broken, we would say something like, “I’m so sorry. I completely understand. If I were in your place, I would feel the same way. Could we make this better? Thank you for coming to us, so we have the chance to make it better.”
Either way, in that situation you could send a replacement item. But how are you going about sending that replacement item and really understanding where that customer is coming from?
A lot of time with an angry customer, business owners get scared or angry or annoyed, but it’s an opportunity to make things right. How you respond to that conflict it really paves the way for future relationships. We have so many repeat customers from orders that didn’t go so smoothly.
Do you remember your first sale?
Yuliya: I do remember, and I was terrified because it was a bigger order. Plus, everything went wrong! Her order got delayed, then it arrived broken. Then I tried to give her a gift card to make it better, and the gift card wasn’t working. I was like, “Oh man, what am I getting myself into?” But luckily, as soon as that first sale happened, I got a lot more that went smoothly.
Mike: Yeah the first sale was not great. [laughs]
Where did that sale come from?
Yuliya: It was from Facebook ads. Which I spent way too much money on for the first two months, and didn’t profit much because of that. But I think that helped a lot in figuring out what didn’t work quickly.
So, what went wrong with your ads?
Yuliya: I think the biggest issues was that I was very trigger happy. If I woke up and saw that overnight an ad did really well, I’d RAISE the budget. And then the next day saw that it did badly and I’d completely kill the budget. And with the Facebook algorithm that doesn’t work so well. That’s why Mike and I are really great together. Because he’s like, “Let’s be patient, let the algorithm understand the ads.” Now we give it at least three to seven days to gauge the performance of an ad before we kill it or scale it.
What have been your proudest moments?
Mike: Our first $3,000 day was pretty cool.
Yuliya: I think when we hit the first 100k in revenue, that was pretty huge.
Mike: And when we had 10,000th customer, that was crazy.
Yuliya: I think more than that, it’s little moments, but when people message us saying, “Oh my god, I love what I received!” That makes it all worth it. A lot of time when you get emails from someone, it’s not from happy customers, so when you do get emails from happy customers, it’s really nice.
If you had $500 to spend on marketing, where would you spend it?
Yuliya: Oh, good question! I would spend it all on Facebook ads, but around half that money I would spend on creating content marketing and running ads to that. Not just running ads to products, but content that engages our audience, that warms them up, that familiarises them with our ad. Then I’d run product ads to that already warmed up the audience, because they trust us, so the conversions would be a lot cheaper.
Have you had any winning campaigns?
Yuliya: Actually it’s mostly been stable. We have our set of products that always do well. We haven’t had any of those “winning products” that in one month make like $80,000 and then die. We’re not really a fad brand. We have just classic items that are good for anyone, any time of year. They’re not trends, they’re just normal products. We’re just pretty stable, which for my sanity is better.
Mike: Agreed. [laughs]
On your store you have a Help Solve Hunger initiative, what’s this about?
Yuliya: We’re really big on giving back. So with every single purchase that’s made, we donate a meal to Feeding America. We find that it always helps us drive the business forward.
Also, when the business isn’t motivating us, when the products aren’t motivating us, giving back always motivates us. Our customers love it as well because it makes them feel good when they purchase from us, because they know that their purchase is giving back.
That’s great! How much impact have you had?
Mike: It’s been I guess 11,000 customers that we’ve had so far, right? So that’s how many meals have been donated.
Have you had any big challenges along the way?
Mike: It’s always a challenge, every day. Finding good suppliers is huge. You run through some bad suppliers early on. Finding products from suppliers that are receptive to working with you, that will respond quickly, and will stand behind the products that they are selling to you has definitely been key.
Yuliya: For me, I’m a huge control freak when it comes to business, so coming into dropshipping I knew that I would have to let go of a lot of control because I wasn’t making the products. So that to me was seemingly the biggest challenge coming in. It’s still kind of the biggest challenge for me.
For example, with our subscription box, if a customer had an issue, we had the boxes, we had the products right at our place, we could easily take of it. But here you don’t have that control. As a business owner, it’s an amazing thing to learn, to let go of your control, but it’s certainly been challenging when you want to have a perfect business.
Have there been moments you felt like quitting?
Mike: Oh, certainly.
Yuliya: Yeah, certainly. We had one product that did really well for us, and we were like, “Yes! This is amazing, no one else is selling it!” And then the twenty days passed when everyone started receiving their products, and they all came broken. To the point where the supplier even stopped selling the product. That for us was so hard because it was so many more hours of customer support and refunds. And it was something that was so out of our control.
Mike: After that, it was about trying to rebuild trust.
Yuliya: Yeah, at that point we hit a rough patch because we were just like, “We just want to make people happy, not pissed off!”
Do you have something that you say to yourself to stay motivated?
Mike: We always say to each other, “We will figure this out!”
Yuliya: Yeah, we always stay solutions focused. My biggest thing is that we’re human, and I let myself be upset. I know that as soon as I’m done, I’m going to figure it out.
We always talk about the ‘breakdown before breakthrough.’ Right when you’re about to go to the next level, shit hits the fan. At least for me, it’s always like this! There’s never a breakthrough without a breakdown first. So in a weird messed up way, we can kind of enjoy the breakdown, because it sucks right now but we know it’s going to take us to the next level. We’re going to learn something from this. It’s going to help us scale.
What are your plans for the store in the long term?
Yuliya: Our plan right now is to keep growing it, and keep scaling it. We’re replicating its success with two more stores.
We’ve also decided we want to start an ads agency as well. We’ve been so in the trenches with ads and Google Adwords, Pinterest ads, Facebook ads, Instagram ads, that we want to help other local business owners.
What’s some advice you’d give to new dropshippers?
Yuliya: I think the biggest advice in terms of actionable steps, is if you’re starting from square one, learn about branding and marketing first, and dropshipping second. Because I find that people who just learn dropshipping, they’re not as sustainable or successful as people who really build a strong brand that their audience can trust.
Have that motivation about why you want to do it. If you’re just doing it for money there are much easier ways I think to make money. I don’t think dropshipping will help you get rich overnight like a lot of people says.
I always say, “I would never wish anyone to be an entrepreneur unless you really want to do it.” So if you really want to do it, find your reason why, whether it’s location freedom, wanting to provide for your family or whatever. Connect with that mission every day, because you are going to have shit hit the fan and that’s what is going to get you through.
Mike: Start slow, in a sense that it’s better for everything to be done well than it for to be done quickly. Make sure that things look nice and professional. Make sure that everything between your home screen, your ads, and your audience is polished. Make sure things are spelt correctly. Don’t be overly gimmicky, don’t have so many pop-ups. Just having a nice looking store is important.
Yuliya: That’s the golden rule, right? Treat others like you want to be treated. Create a store that you personally would want to shop in.
