LEVEL: Beginner / Newbie
Dropshipping vs. affiliate marketing... Which is better?
Dropshipping and affiliate marketing can be great ways to make money online without worrying about shipping and manufacturing products.
As dropshipping and affiliate marketing have pros and cons, we'll compare the two to find out which business model is best for you.
Dropshipping vs. Affiliate Marketing
Affiliate marketing differs from dropshipping in that you get paid to promote products sold by other companies. Dropshipping allows you to sell your products directly from the manufacturer.
Both business models are similar, except that affiliate marketing does not deal with product manufacturing or fulfillment.
Let's look closer at affiliate marketing and dropshipping.
The Difference Between Affiliate Marking And Dropshipping
Dropshipping and affiliate marketing allow you to make money selling products made by other companies.
These business models are ideal for digital nomads and others who wish to travel the world and make money simultaneously. Your business can thrive wherever you travel in the world. You only need a computer and WiFi access to get started.
These are the key differences between dropshipping and affiliate marketing:
- Dropshipping requires you to manage customer service. However, affiliate marketing allows you to sell the product, and the website will take care of any customer service issue.
- Dropshipping is selling products from your website. However, with affiliate marketing, customers are taken to an eCommerce site via your affiliate link.
- Dropshipping can allow you to make higher profits by setting your own prices. However, as an affiliate marketer, you don't have any control over the commission rate or the retail price.
- Dropshipping will pay you immediately after the transaction is complete. Affiliate marketing may take up to 3 months before you receive your payment.
- Dropshipping may be problematic if your product supplier cannot supply you anymore. Affiliate marketing can be troublesome if the affiliate company doesn't pay or if the product you have spent time and money promoting is suddenly taken down.
Dropshipping allows you to control most aspects except product quality and shipment (with some exceptions). Affiliate marketing only allows you to control your marketing angle and content. The company whose affiliate program you are promoting manages the rest.
Let's dive into the details.
Why Affiliate Marketing?
Affiliate marketing allows you (the affiliate marketer) to make money by recommending products or services to your audience and readers. 93% of customers read online reviews before purchasing.
That's huge.
You can earn a portion of the profits by reviewing products and recommending them to others.
It is easy.
As an affiliate, you'll receive a portion of any sale made by someone who clicks through your link.
Becoming an affiliate marketer for free is possible, and it's pretty simple!
After choosing your niche and setting up a site, you will need to find businesses that you are interested in promoting and signing up for their affiliate program.
You can usually find a link to sign-up for an affiliate program in the footer section of their website. After you have registered, you can start creating affiliate links. These links allow the business to track who made a purchase and which affiliate referred the customer.
Many affiliate programs offer a more extended cookie period. You can still earn commissions if someone clicks on your affiliate link but doesn't buy immediately. You will still be eligible for the commission if they revisit the website and make a purchase during the cookie period (often 7 - 30 days).
Affiliate commissions are typically paid after 30 days, which gives time for returns to be processed.
Why Start With Affiliate Marketing?
● It is easy to get started.
● You only need a blog to start your business at low startup costs
● There is no need to provide customer support; the merchant will take care of that
● Your business can be operated from any part of the world
● It can be a great source of passive income.
● Your affiliate links can be added to your blog, YouTube, and social media.
● If you focus on building websites, you can sell them as hands-free mini businesses for 30x-40x monthly profits.
Affiliate Marketing Business Cons:
● Low commissions are paid by some companies
● Sometimes merchants take longer to pay commissions
● Pricing is not up to you
● Some niches are saturated and face a lot of competition
● Your website is passing its visitors on to a third-party
● Rates for commissions can change without notice
There are both pros and cons to starting an affiliate company. However, you can overcome these if you have the right information. There are many options for affiliate marketers.
Choosing a niche and building a website around high-priced products is often worthwhile. This will lead to higher commissions.
A less competitive niche can be chosen. This will increase the chances of your website being found in search engines.
How To Find Affiliate Programs To Promote?
It is easy to find the best affiliate program. First, you will need to research what products you wish to recommend and then search for eCommerce shops that sell them.
After you've found the store you wish to promote, look in their website's footer for a link to an affiliate or partner program.
You can send an email to customer service if there isn't an affiliate program listed on the main site. If they do, they should be able to point you in their direction.
We have the right affiliate programs for you in these niches:
You can also join large affiliate networks.
Affiliate networks are great because once you sign up, you can access thousands or even hundreds of programs.
Some of our favorite affiliate networks are:
- Clickbank
- MaxBounty
- AWIN
- ShareASale
- Commission Junction (CJ)
- Rakuten
- Amazon Associates ( not a network, but it gives you access to all Amazon products)
There are many more!
Where Can I Promote Affiliate Links?
You can promote affiliate links anywhere online. However, the affiliate program you choose may have restrictions.
While most people promote affiliate partners via their websites, you can also share your links on social networks. Use the "swipe up" feature to post links to Facebook, Instagram, YouTube, YouTube, and Twitter.
Don't have a blog yet? Don't know how to start one? We offer bespoke one-on-one consulting to get you started. We can even set up the site for you (for a fee). Get in touch!
Alright, now let's now turn our attention toward dropshipping.
What is Dropshipping?
.png?resize=671%2C419&ssl=1 "Affiliate Marketing vs Dropshipping: Which is better in 2024? | Martin Sand's MWTS")
Dropshipping is a popular online business model. It is popular because you can run an eCommerce business where you sell products without actually dealing with them yourself.
How it works:
- Dropshipper: You can start your own dropshipping business
- You can choose your store inventory and set your price. Then, you can sell the products through your eCommerce store.
- Dropshippers mark up the wholesale price by about 30% to make decent profits
- The customer buys from you at the retail price
- After they have paid for the product, you will order the product at wholesale prices from the producer/seller.
- It is sent directly to the customer, who believes it came from you
- You make a tidy profit!
Dropshipping can be a great way to start an eCommerce store on a tight budget. Dropshipping is an excellent option if you don't have the funds to purchase large quantities of inventory or warehouse storage.
Dropshipping is excellent if you want to run an eCommerce store!
This is a great option for anyone looking to test products in a market. Before you spend a lot of money upfront on storage and inventory, see if your product can be sold to someone else.
A few years back, many affiliates turned to dropshipping because of the profit margins and the low cost of Facebook advertising. It is not as easy anymore.
Why Start Dropshipping?
● Dropshipping has low risks - you only have to pay once your order is placed.
● Startup costs are low - all that's required is a website
● You set the product price
● Profit margins are higher
● Create your brand
● Possibility to grow and sell your products in the future
● Advertising allows you to retarget customers
● Your customers can choose from a greater variety of products
● You can sell your business as a hands-off business (if you outsource order & customer support)
Dropshipping Cons:
● You will need to manage customer service and support
● There is no control over the packaging or the quality of the product.
● Dropshipping is becoming saturated.
Dropshipping is not without its risks and downsides. However, there are many ways to minimize them. Doing your research about the best products and how to sell them will pay off in the long term.
Dropshipping is cost-effective. You can test ads to determine which products are most popular.
Several courses will train you how to do dropshipping, and some will teach you how to set up your eCommerce store to run on almost autopilot.
It doesn't mean you have to enter business blindly.
How To Find Dropshipping Suppliers
Look for reliable suppliers who can deliver high-quality products when looking for dropshippers. Remember, it's your brand on the line here!
A good supplier is crucial to save you time and reduce the amount of customer service calls. There shouldn't be any problems if the supplier is reliable.
How To Build a Website For Dropshipping?
You can establish your dropshipping website in several different ways.
An eCommerce platform such as Shopify is the best and most straightforward option.
With Shopify, you can build an eCommerce store without worrying about the tech stuff. Because of that, it is a very popular option for dropshippers. Shopify easily integrates with many automation tools like Oberlo, as well as email marketing tools.
WordPress and WooCommerce are two other options.
Although this option is cheaper, it will require more effort and knowledge about how your site works. However, learning WordPress will always come in handy.
You don't have to be an expert to begin dropshipping. Dropship courses are available if you want to learn from someone who has done dropshipping successfully. These courses will show you step-by-step how to create a dropshipping website.
So, Dropshipping or Affiliate Marketing?
Dropshipping or affiliate marketing? Deciding which one is better is hard. It all depends on you and your goals for your online business.
Many people prefer affiliate marketing because it is relatively hands-off except for creating content and SEO.
Affiliate marketing is possible without having to have a website. It is an excellent choice for YouTubers and anyone with a large social media following.
Affiliate marketing is a low-risk business model that makes it attractive for beginners. Affiliate marketing doesn't require any money, but you will need a lot of resources to get started on the right foot.
Dropshipping is a strategy that works better for some people. Dropshipping requires a bit more effort, especially with customer service. And most dropshippers rely heavily on ads instead of SEO. However, there are many benefits!
Dropshipping is more expensive to start, but it can be very profitable once it's established.
Which is More Profitable?
Overall, dropshipping is typically the more profitable business model.
Dropshipping allows you to set your prices and determine your profit margins. This is often much more than what you get from affiliate marketing, which typically ranges between 3-10% if you go for Amazon products. Personally, I rarely promote products with less than 30% commissions as I prefer promoting digital products and health-type offers.
Dropshipping is a high-ticket business that can make you a lot of money. As long as you target the right keywords, you can expect to start making a lot of money within your first few months.
Dropshipping is the best option if you want high profits.
Digital products are an exception.
Affiliate commissions can be as high as 50%+ for SaaS (software-as-a-service) products and online courses. These niches are highly competitive.
Is Affiliate Marketing Profitable?
Affiliate marketing can be very profitable. It can also be replicated and repeated.
It all comes down to how much effort you put in.
Compared to Amazon affiliate websites, dropshipping is probably a more profitable option. However, affiliate sites could be more hands off.
Affiliate marketing is different if you promote high-commission, high-converting digital offers.
Our verdict: Affiliate marketing is more profitable than dropshipping if done the way we recommend.
The Easiest Choice?
Affiliate marketing is the easiest option.
This is because, once established, it is a very hands-off business model.
After creating your website and writing content targeting the correct keywords, you can add your affiliate links.
You can also hire a “blogger” to help you run your business.
As you add more content to your blog, your traffic will grow. Your earnings will also increase over time.
You also need to consider the cost and time related to SEO.
However, it is possible to automate your dropshipping business completely.
You can automate nearly every aspect of your dropshipping business with integrations and tools.
After you've done all the work in building your online store and finding suppliers, you can finally relax. You will still need customer support unless you outsource it.
Final Thoughts Regarding Dropshipping and Affiliate Marketing
Dropshipping and affiliate marketing are great business models that can help you make money online.
Although some work is involved in both businesses, you can reap the benefits once everything is set up. You will gain valuable marketing skills for each business that will help you be successful in any digital venture you may want.
Dropshipping, affiliate marketing, or both are viable business models. You will enjoy the freedom and benefits of working from home. What more could you want?
Still unsure about what type of business you want to start? Look at our guide to other online businesses that you can start on a limited budget.