Affiliate Marketing vs. Drop Shipping: Which One is Right for You?

If you want to work online from home, both affiliate marketing and drop shipping can provide you with a steady income. However, these two industries have important differences. The key to success is figuring out which one will work best for you.

With affiliate marketing, you have a relationship with a company. Your website promotes their product or service. Anytime your marketing efforts lead to a sale, the company will give you a commission that they’ve set in advance.

With drop shipping, you sell products yourself, but they are actually shipped to your customers directly from the manufacturer. Many manufacturers love drop shipping, because online retailers are like another salesperson.

Neither industry requires very much in the way of set-up or operating costs. In fact, you do not even need to hire any employees if you don’t want to! The work can all be done online, right from your house. Plus, since you are not the manufacturer, you do not have to worry about customer service issues or technical support.

But, there are some differences between affiliate marketing and drop shipping, and it’s these differences that can help you decide which industry is right for you:

– In affiliate marketing, you do not control how much money you make; all of the commissions are determined by the company – not you. With drop shipping, you can set your own prices. Your profit is the difference between the manufacturer’s price and your own, so it’s up to you to figure out how much of a mark-up you can get away with.

– In affiliate marketing, you are not actually selling the product; you are simply encouraging people to head to the company’s website and buy something. That means you have to rely on the company’s sales copy just as much as your own. Plus, if the company suffers any technical problems (like a website that crashes or doesn’t work properly), it can hurt your profits. When it comes to drop shipping, your site is the site people make purchases on. You do not have to rely on any other site to make sales.

– Drop shippers have to set up their own ecommerce websites, complete with product descriptions, online shopping carts, and payment processors. Affiliate marketers can get away with just having a single landing page if they want. Since they are not the ones making sales, affiliate marketers do not have to worry about accepting credit cards or maintaining a big retail website.