Affiliate Marketing vs Dropshipping

 

 

Affiliate Marketing vs Dropshipping

 

Overview

 

This article briefly explains why a dropshipping business has more potential of bringing success to you and your online store than affliate marketing.The pros and cons of both dropshipping and affliate marketing will be presented, the Amazon Affiliate program will as well be covered and finally, a conclusion will be drawn summarizing the advantages of dropshipping (which are also presented in the basics section of this topic). 

 

At the surface, both dropshipping and affiliate marketing both seem like profitable ways to earn cash overnight. Nevertheless, it is important to remember that both of these models require consistent effort in order to be well-established.

 

Nowadays, most entrepreneurs starting online business are divided between dropshipping and affiliate marketing. With dropshipping, the inventory is taken care of by the manufacturer, which is also responsible for the shipment of the product directly to the customer, on your behalf. In dropshipping, you establish your own prices and conduct your own marketing strategies. As far as affiliate marketing is concerned, the same process takes place (the merchant carries inventory and ships the product). Nevertheless, while you’re still responsible for marketing, you don’t get to set the product price and only receive a commission.

 

Dropshipping

 

PROS

CONS

Low-risk business model

Individual management of customer support

Allows for high profit margins

 

Gives the opportunity of building an asset

 

Various chances of attracting new customers

 

 

Affiliate marketing

 

PROS

CONS

Almost no costs for being an affiliate

The profit is made from commissions

Valuable source for passive income

Payments may be delayed

No need to worry about customer support

People can remove the affiliate link

 

Little to no control over products and pricing

 

(Source: https://bit.ly/2GMD2uq)

 

Amazon Affiliate program

 

In recent years, there have been various complaints regarding the terms and regulations of the Amazon Affiliate program. Below, several reasons explaining why you should avoid the Amazon Affiliate program are mentioned below: 

 

  • The money is received 60 days subsequent to the calendar month in which you’ve earned profit.
  • The rules of the Affiliate Program can be changed anytime by Amazon.
  • Program fees offered occasionally offered for different products can be modified or cancelled by Amazon at any given time without notice.
  • A wide range of products are not included in the program.
  • Various purchases do not count as payments (returns, incorrectly tracked purchases, purchases made through a link shown in a search engine or other referral service).
  • In some cases, the purchases might not be tracked if the affiliate links placed on your personal website are incorrectly formatted from a technical point of view).
  • You are ineligible to participate in the Affiliate program if your website contains Amazon trademarks of any kind.
  • There is a high probability of getting banned from the program if the company considers you are inadequately using Amazon or its affiliates trademarks.
  • You need to follow a special Operating Agreement in case you are a non-US citizen

 

(Source: https://bit.ly/2SNYqWg)

 

Why choose dropshipping over affiliate marketing?

 

While affiliate marketing can bring profit to your business without having to endure many costs, it has several financial inconveniences that might make you think twice before proceeding with this model, i.e. you could easily lose money if you rely on other businesses. As a consequence, even if you decide to advance with your affiliate marketing business, you would want to include one or several dropshipping elements in order to make it more profitable. A few of the reasons for which running an online store is more convenient in terms of money flows are:

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