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Beware of high shipping costs, lack of information and false testimonials

For a long time, I thought I was Mark Zuckerberg’s pet peeve: impervious to online advertising. That was until I saw a post on Instagram claiming to have found the most comfortable bra in the world. “No Digging, No Bulging, No Stress!”

The post was accompanied by a time-lapse video of gorgeous women living, laughing and loving in soft, moldable bras that looked divine. Ladies, you know what a holy grail that would be. In an instant, I was Veruca Salt, quietly whispering, “I want it NOW.”

But when I clicked on the link to buy, I realized something was wrong. High shipping costs, no information on the manufacture or origin of the bra, obviously false testimonials…

Sure enough, I did some research online and found disgruntled customers to whom the Miracle Bra sounded more like a mirage—a cheap schmutter that took months, if ever, to arrive.

This was my very first encounter with drop shipping, a global phenomenon barely known to people over 50, but which is becoming one of the most popular (and controversial) ways to buy and sell in line. Dropshipping is an age-old retail concept, referring to how mail order companies, high street shops and online stores ship items from wholesale suppliers so they can fulfill orders.

But thanks to globalization and the internet, it has turned into a ubiquitous “side hustle”, i.e. a source of additional income, thanks to e-commerce platforms such as Shopify, Wix and AliExpress. These sites make it easy for you, Joe or Joanna Bloggs, to set up an online store and sell cheap products (often made in China) without ever having to handle them yourself.

It sounds like a savvy and efficient business model, and social media is full of influencers who claim to earn six figures a year from drop shipping. Once you find out, you’ll see it everywhere online, usually in the form of clickbait videos designed to go viral so their promoters can avoid paying for ads.

Turns out, ad-resistant customers like me aren’t Facebook’s worst nightmare. It’s the creators of popular meme humor accounts and unscrupulous senders who buy them out, so they can pollute subscribers’ timelines with gratuitous, disguised ads for all kinds of tattoos.

More than Money

The supposed miracle bra is one of the more conventional products on offer. You can get a burrito blanket, toilet paper with Donald Trump’s face on it, and countless little gadgets you didn’t know you needed, the modern equivalent of the Innovations catalog that came out in the mailbox in the 1980s and 1990s, peddling laughable inventions that you could use once before throwing them in the tech graveyard.

Dropshipping is hollow, environmentally destructive consumerism that adds little value to the economy. Many drop shippers are manipulating social media algorithms to good effect, using intrusive data tracking and video bombing to divert commerce away from genuine SMBs, all so they can sell products that aren’t what they either seem to be or don’t. Customer service is generally terrible to non-existent.

As for those influencers who seem to be living the dream of dropshipping? An independent analysis of the Shopify drop-shipping platform in 2018 found that 80% of sellers were losing money, while 84% of Shopify-hosted websites had no traffic. Plus, you need some upfront money to start an online store and go through the process of trial and error to find the right products to appeal to this unstable online market, with no guarantees that you’ll make it back.

I understand why dropshipping is attractive at a time when going to college and finding a job no longer leads to automatic financial security.

In his recent book on the influencer economy, Get Rich or Lie Trying, writer Symeon Brown interestingly argues that the Thatcher-Blair legacy (aided by Silicon Valley) is where the online scam and a “fake it till you make it” approach now yields the greatest financial rewards (at least for some), but also encourages fraud, exploitation, and the erosion of our self-esteem.

Drop shipping is on a grim continuum with multi-level marketing downsides, influencer hucksterism, and the “emperor’s new clothes” vibe surrounding cryptocurrency. Sometimes it feels like our generation will forever be stuck in an abusive relationship with online commerce and businesses that promise far more than they can ever deliver.

But if the cost-of-living crisis is making dropshipping more attractive to scammers, it’s a different story for beleaguered consumers. Now that inflation is back and supply chains are collapsing, those little “oh, carry on then” purchases on social media will be the first to go, right?

In other words, if our generation can get by. Drop shipping – and the wasteful and parasitic business practices it encourages – will only
thrive as long as enough young social media users are willing to embrace it all. Meanwhile, my search for the perfect bra continues. I’m not going to look
on Instagram…

Iona Bain is the founder of the Young Money blog and the author of Own It!

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