In this first lesson, we're going to be talking about the criteria, the six criteria of a winning product. Alright, this is the criteria of a winning product. Now, let's just go over each of these six criteria. The first one, which is probably the most famous one out of them all, is the "wow" factor, AKA the "scroll stopper." Now, it's usually the product that causes this "wow" factor. However, your marketing of the product can also cause this "wow" factor. For example, in some of the footage, you might have a "wow," provoking kind of effect on the viewer. Or the product is designed in such a way that it's just never been before seen.
So some examples of factors that can cause this "wow" factor would be that it instantly grabs attention and it stops the user from scrolling. Some reasons why it might do this is that it's very unique, it's very innovative, it's very intriguing, or there's a certain cool factor to it. Another reason could be that it's unheard of, it's never before seen, and it definitely cannot be found in stores. And lastly, some of the intuitive kind of design aspects to the product. Maybe it's the design, maybe it's the functionality, maybe it's the elegance, or a curiosity-provoking effect it might have.
Next is the criteria of solving a problem or adding value. Now, this is the reason why anybody buys anything. It's because it solves a problem or it adds value in some way. So the first type of product would be the painkiller. It alleviates or solves problems. It solves pain. You take the painkiller and then you feel no more pain anymore. So it does solve an active problem. And by the way, problems don't actually have to mean real problems. For example, something like a back posture corrector would actually correct a "real problem." But something that unclogs the drains is not really necessarily a problem solver. It's just something more of an inconvenience.
So problems and inconveniences are in the same boat,. The value adder is something that adds value. Now value is subjective and it's very personal for everybody. So basically it makes something easier or better or more convenient. It saves time or effort. It provides some sort of massive benefit or convenience. And another type of value would be something toward the ego, the vanity, the status, more like something personal, right? So if you buy a beauty product that has to do with more, your beauty, your physical appearance, so more things that have to do with the self.
So if somebody's buying a car shine, they're not really buying it because they have a problem with the dirty car, they're buying it because they want to have those perceived benefits or perceived value from having a shiny car. And maybe that has something to do with status. Maybe that has something to do with presentation, their sense of identity. You know, there are a lot of reasons. So most products either solve a problem or they add value in some sort of way. However, there are a couple of different products that are just an exception. You can't really predict and you can't really look at their product and say, "Okay, this solves a problem," or, "This adds value." For example, some of these products, they have no inherent value.
But they're just very highly engaging and provoking and they have a tendency to go very viral. These types of products are not very predictable. Some classic examples include the snuggie, the pet rock, certain dog costumes. For example, I could have two types of dog costumes. One could be like a green dinosaur and another one could be like a cowboy outfit. Now, inherently, they're the same thing. They both are costumes. They both don't really solve any problems. They both add value in that, you know, you can have a dog costume for Halloween or something. However, if you test those two types of products, it's very hard to predict whether the cowboy costume is going to outperform the green dinosaur costume. So this is what I mean by exceptions.
It's very hard to predict and they don't really have inherent value. So the majority of products are either going to be painkillers or value adders. Moving onto our third required criteria would be the healthy profit margin or the profit potential. Now a healthy profit is anything above $30. You definitely want to strive as high as you can. However, $20 and up is quite the standard. And for the most part, you can get away with it, but you definitely want to strive as high as possible.
Now, anything $15 and under is very, very dangerous. Now, by the way, what I mean by the profit potential or the gross margin is defined as your total product selling price. So that's the shipping cost, if you're charging $5 for shipping, and if you're charging $20 for a product, then that's $25. And if the product costs you $5, then you would take the $25 product price and subtract $5. And you'd ultimately have a $20 gross margin.
So you definitely don't want to be aiming for $15 and under unless it's very certain that somebody is going to buy two units. So the average order value would have a $20 or more profit margin. But if you're only selling one unit and you're only making $15 or under profit margin, it's very hard to sustain profitability. And besides, who wants to work so much and see very little returns, right? However, on the flip side, this definitely doesn't mean that you can price at whatever you want.
Your product price has to match the perception of the value of that specific product. So this is why factors like design, product photos, video footage, presentation of the store, all of these things are important. So if you're selling a product for $50, that product has to look like a $50-product and not a $20-product. So if your $50-product had a bunch of very low-resolution, low-quality photos that did not really put the product in a good light, then that's going to have a negative perception of value. The photos, the product design, its functionality, its features, and even the industry it's in, these things have an effect on the perception of value.
So you definitely want to maximize the perception of value as much as you can. Now, here are some general pricing suggestions. $29 should be an absolute minimum. So if you're selling a product that costs you maybe $5 or less, you definitely want to strive for at least $29.99 plus $5 shipping. And you could go with $6.99, like $46.99, $44.99, $49.99. So basically, strive toward even numbers. And then the digits of four, six, and nine. Now, I generally recommend any price between $30 and $150.
You can price higher than $150, but just understand that it's going to require a lot more marketing effort. It's going to require a lot more of a budget, and it's typically harder to sell a higher-ticket product. And also, side note, products that cost more tend to have better marketability, tend to have better footage, tend to have better photo assets that you can use, which will increase the product's perception of value and therefore allow you to get away with setting the price at a very high $100 price tag, $150 price tag. So this is the goal of a winning product.
You definitely want to have a high margin. So a high margin, high-profit potential, and high volume. So a lot of transactions. If you can achieve these both, and you have a serious winning product, a lot of times, it's maybe medium margins and high volume or high margins and medium volume. But if you can get both, then you have a serious winning product. And lastly, you definitely want to charge for shipping. I don't like to give free shipping right off the bat. I like to incentivize my free shipping offer. So for example, I have an announcement bar that says, "Orders over $50 and up qualify for free shipping." So this will incentivize people to maybe add two to cart or maybe buy some other products.
They like to add $10, $20, $30 more to their cart just to be able to get that free shipping offer. And let's just say, a customer is turned off by paying for shipping. Then you can send some abandoned cart emails, or you could even retarget them with the free shipping offers to hopefully capture that lost potential sale. So this is the reason why I like to charge for shipping. It just increases the average order value. Okay, moving on to our fourth criteria, which is the marketability of a product, which is not very talked about a lot of times.
You typically hear about the "wow" factor, you typically hear about value-adding. You don't really hear people talk about marketability. Now, marketability refers to how easy it is to advertise your product. How easy is it to sell the product? Now, this has to do with the high perception of value as we discussed. All of the product photos, the way the product is designed, the video footage, the ad creative, all of these things have an impact on the consumer's perception of value. And this generally is known as marketability.
How easily can you market something? Also, how easy is it to understand? Now, if you're trying to advertise a product that was very obscure, that was very complicated, nobody really understood what it was within a couple seconds, then people were not going to be exerting that mental cognition and that energy to try and understand a product that they're not even trying to buy. You know, you're interrupting them with an advertisement via social media, so that product should be very self-explanatory.
It should be very simple and ideally a mass-market product, which we're going to be going over in just a second. Customers should be able to look at the product and within a second or immediately, they should be able to understand what that product is, why they like that product, why they want that product. You don't want a customer to have to think too much about why they want it. You want people to buy your product emotionally, not logically. Consumers like to buy with emotion and then rationalize with logic. So what I mean by that is that a typical reaction of a product would be, "Oh, that's very cool, but I don't really need it." If they say they don't really need it, then that means that the product does not have much value.
The ideal reaction would be, "Oh wow. That product is very cool. And that, actually, could be quite useful." You want a kind of reaction like that where they're emotionally invested in the product and they're also rationalizing it because of its usefulness because of its value. And we've already covered the concept of high perception of value. Things like good design, the elegance of the product, and the functionality of the product. And does the product and its photos and videos, do they appear very professional, right?
So professional and branded are kind of synonymous. What do I mean by branded? It's not necessarily that the product has a brand label on it, but that you could perceive that the product could have a brand on it because of the photos. Because a lot of AliExpress listings are not made equal. Some listings have just a lot of low-quality photographs and just poor while other products have very professional assets that you can use. Photos, videos, the visual representations of the product.
You want to strive for very high quality, very professional. Okay, moving on. This is the fifth criteria, which is the mass-market appeal. Now, not all products are going to have a mass-market appeal and it's definitely not required. However, this is the difference between making $10,000 on a product versus $100,000 on a product. Simply put, the broader the market appeal, the more you can scale. So the question you should ask yourself when doing product research and looking at a product is, "Can this product be sold to multiple audiences and niches?" If yes, then that is a very good sign. If no, then that is not necessarily a bad sign.
You can easily make six figures on a niche product. Now, let's take an example. If you're trying to sell a motorcycle phone mount, you can really only sell that to motorcycle riders and the wives or friends of motorcyclists. Anybody that's not in these audiences would not really have an affinity or really any relevance to buying a motorcycle phone mount. However, if you're trying to sell a pair of headphones, you can virtually sell that to anybody. You could sell that to gym-goers, which is already very huge. You could sell it to commuters, people who ride the bus, people who travel a lot, you can sell it to gamers, which includes console gamers, mobile gamers, and PC gamers.
You could sell it to entrepreneurs, people who go to the office, or people who are in college. You could sell it to parents, which is just a ginormous audience. You get the idea, you can sell it to a lot, lot more people. Now, this does not necessarily mean to avoid niche products. It's just simply something to consider. The more people that you can sell to, most likely the more money you will make. And lastly, let's talk about timing. Now, this is something that I hear nobody talking about. However, it's relevant in almost every single product that you're gonna test and all of the advertisements that you're going to launch. Now, if you look to the right, we have this chart called the diffusion of innovation theory.
You can look at this chart and each section represents the dropshipping competition. You have the innovators, which are basically people testing untapped products, products that have never really been tested before. And then you have the early adopters, people that are hopping on these products immediately and very, very soon. Then you have the early and late majority, which is basically the majority of the competition of a product. And then you have the laggards that are testing products that are way too saturated and they're simply very, very late. So an innovator would introduce an untapped product to the market and the early adopters would come, and then the early majority and late majority would come.
Now, something that's interesting is a lot of times, old products are actually recycled and recycled. So in a way, it goes through the cycle and then repeats itself. So the first time a product is ever tested and scaled would be at the very front of this chart. And then it would go through its natural cycle. And after the competition has slowly died off for the product, the product is eventually forgotten about. And then you would have an innovator reintroduce that product to the market, essentially repeating this whole cycle again and again.
This is the case with a lot of winning products. You see them time and time again. For example, it's Halloween time, and then you see this Halloween mask that's reintroduced every single year. You have a classic Mother's Day rose every Mother's Day. You have a lot of products that are repeating themselves over and over again. We're going to go over each of these four product types in another video. Let's just go over some examples of actual winning products and break down each of their criteria. Alright, let's talk about some examples. Now, this first product, which is the portable blender, which you guys most likely know of. So the "wow" factor. Yes, it definitely has a "wow" factor because it's very innovative.
You've never really seen a blender that was made portable before. Traditionally, blenders are very bulky and very heavy. And now all of a sudden, you have a blender that's very elegant, that's very colorful, that's portable, and it's just never been heard of before. The value adder. Now, it doesn't really solve a problem better than any other traditional blenders. However, it adds value and the convenience that it has and the appeal for better health, which is typically why somebody would buy a blender in the first place.
Now the profit margin. This product costs somewhere around $12. And if you sold it for $40, then that would give you a very generous profit margin. And it can definitely easily be sold at a price ticket like that simply because blenders are typically expensive. They're typically in the hundreds of dollars. So it's not a stretch to ask for $40 for this product. It's very believable. For marketability, yes, it definitely does have marketability because it's very nicely designed. It comes in multiple colorways.
It has good photos and videos that you can use for advertisements and your product page has a high perception of value simply because blenders already have that product price of $100. So that is somewhat of a leverage for you to price this product higher. And this product is also very easy to understand. Mass-market appeal. This product definitely does have more of a mass-market appeal because it has multiple audiences that you can test and these audiences are very large. We have the fitness industry, which is a huge industry already, which comprises of multiple niches inside of fitness. We have dieters, including vegans and juicers and other sorts of diets.
We have brands such as Smoothie King. We have people in a hurry, such as commuters, students, etc. So it definitely does have a mass-market appeal. Okay, now let's talk about the posture corrector, which I'm sure 99% of you guys know. The "wow" factor. This product definitely has a "wow" factor when it was first born, simply because it's never been heard of. Everybody experiences back pain and this sort of more or less degree. However, nobody really introduced a back posture corrector like this. It was very innovative in that sense. And it's very relatable simply because, as I said, a lot of people have back pain. In terms of value, it definitely solves a problem.
It relieves physical back pain and encourages good posture, which also increases attraction or maybe confidence. The healthy profit margin. Yes, you can definitely get away with it selling these products at a $20-margin. Marketability. Yes, it definitely is very easy to understand. It's easy to market. You could show somebody with the slouched posture and then when they're wearing this, they have a very straight, upright posture. You have testimonials, you have people maybe testifying that they had back pain and now with this product, their back pain is somewhat alleviated. It's very easy to market.
The mass-market appeal. It's very, very huge. Now, basically, everybody has back pain. I mean, I'm telling, you most people have back pain. It's the gamers, which is already a huge industry itself. You have the mobile gamers, you have the PC gamers, you have the console gamers. You have office workers or entrepreneurs or other occupations that require sitting down for long hours at a time. We have the parents or the older demographic. We have commuters and travelers. We have people who are into yoga or fitness.
We have chiropractic-related interests and more. Last but not least, let's talk about the USB mosquito killer. Now, the "wow" factor. It definitely has a "wow" factor simply because the alternative to a mosquito killer would be that hanging mosquito tape that just looks very unattractive. And the "wow" factor in this product is not necessarily the design. The product innately doesn't really have that "wow" factor. However, if we were to see the footage of this product, that would trigger the "wow" factor. For example, the footage available for this product shows this product capturing hundreds and hundreds of mosquitoes overnight.
If a user were to see that footage and they currently have a mosquito problem in their house, that is the "wow" factor. They're going to say, "Wow, this product is that effective? It works that much?" That is more or less a reaction they might have. So in this case, the video advertisement would show off that "wow" factor. And also, a side note, for a product like this, you would definitely benefit from having a video advertisement over an image advertisement. An image for this product would not really sell as much as the dramatic video footage of, you know, hundreds of hundreds of dead mosquitoes being captured by this product.
Now let's talk about the value. It's definitely self-explanatory. It solves the mosquito problem, which is an annoyance as well as a health hazard. Then we have the profit margin and this product, as well, you have a very healthy profit margin. You can easily sell this product for $40, even $50. The marketability. Yes, this product definitely has good marketability. It has a good modern design with multiple colorways. It's got good photos and videos, a high perception of value simply because this is a home appliance, this is a technological product, and it's very easy to understand.
And not only that, as we said, that is very, very "wow" factor-triggering. So this product definitely has great marketability. Mass-market appeal. I would say this product has not the biggest mass market, but it definitely has a very, very large market. So, you have homeowners, basically anybody that owns a home or apartment. We have parents. We have people who do not like mosquitoes. We have people who do not like pests, people who don't like cockroaches or rats, you can imagine that they would also not like mosquitoes, people who purchase insecticides, etc. And this product would definitely benefit within some seasons, for example, the summertime.
This product would not really be so relevant during the wintertime. And that is it.
