Affiliate marketing and dropshipping are both viable ways to make money online, but which one is better? There are pros and cons to each model that help you decide which approach will benefit your business more.
This article breaks down 5 reasons why affiliate marketing is better than dropshipping. By the end, you’ll know which approach to choose if you’re just starting out with eCommerce or if you’re planning to switch to affiliate marketing in the future.
You can make more money with affiliate marketing
Many affiliate marketers don’t think of themselves as business owners. But you have to look at yourself as a business owner and not just a guy who’s trying to make money.
With affiliate marketing, you are your own boss, so you can set your hours and determine how much money you make.
You may not be making millions, but you can probably still make a comfortable living doing something that you enjoy. And it doesn’t stop there; with dropshipping, there isn’t really any opportunity for expansion unless you take things into your own hands.
There’s also very little incentive or reason to continue working hard. If you start out by applying what I teach in my course, though, there will always be opportunities to earn more money or reach higher tiers in your affiliate program.
You get access to big brands: When you decide on a niche and start promoting products within that niche, one of the first brands that come along might not offer affiliate programs – or maybe they do but at an inferior rate compared to other brands in the same niche.
Or maybe you choose a brand early on without knowing whether their products actually sell well; either way, it would have been better if you had done some research before getting started. It happens all too often that people rush into things without thinking through their choices beforehand.
Everything happens for a reason though, so when these things happen, remember why and reflect upon where you went wrong.
The right amount of planning will never hurt! You are forced to network: One thing about starting out with dropshipping is that there’s no need to network because no direct communication is required between yourself and customers or suppliers; everything goes through third-party tools like Shopify. By default, nobody knows who made their website or sold them those items – only Shopify knows.
Affiliate marketing makes it easier to track results
Because you get a commission on sales, it’s easier to see how effective your marketing strategies are. It’s easy to set up an affiliate marketing campaign—you just need a merchant account, website, and promotional materials.
Tracking results means more money in your pocket: No matter how you decide to make money online, you need to track your efforts if you want to improve your results.
But with affiliate marketing, you can use unique links for each referral which makes it much easier than having to log in to every individual affiliate network separately.
With dropshipping, tracking links or cookies are almost impossible unless you’re working with a large retailer who can provide them. Save time when you start selling products immediately: When you sell products directly from your own site, there’s no waiting on the stock since all of your merchandise is virtual.
If you don’t have enough inventory yourself (such as from drop shipping), then even waiting a few days for stock can be too long to earn any revenue at all.
You could put up banners saying coming soon! or something similar to let people know when things will be available but that requires even more time and effort before you can actually start making some cash.
Generating traffic with affiliate marketing is much easier
When you’re using affiliate marketing to sell a product on your website, you don’t have to invest in selling it, too. In fact, if you’re doing things right, that extra traffic will generate sales for you without your needing to do anything.
It might be easier—but does that make it better? Not necessarily. While affiliate marketing makes selling easier for e-commerce stores, it also means less control over how and when products are sold. While drop shippers can run ads at any time of day or night and push new products into their inventory whenever they want, affiliates have to wait until a sale occurs before they can promote a new product.
With affiliates, there’s no way to replenish stock instantly—you just have to hope people buy your stuff while you restock. And if they don’t? Tough luck; no instant replenishment option means no cash flow. So what’s better really comes down to what works best for each individual business. One thing is clear: both dropshipping and affiliate marketing offer something unique, so all businesses should consider trying both before deciding which one is right for them.
Building authority and trust are easier with affiliate marketing
When you work with a brand that already has authority and trust, it’s easier to build those things. Simply by linking to a site or product with an affiliate code built into your content, people are more likely to trust your recommendations—and they don’t have to put up with any added fluff.
If you have drop shippers trying to recommend products, they’re always going to be pushing something on people as a means of earning referral fees.
On top of that, if you decide one day that maybe dropshipping isn’t for you, after all, it can be difficult to move away from what worked well in order to build your own authority or trust.
Some brands never quite reach their potential because their affiliates become so fixated on ways to earn money through referrals instead of building trustworthy relationships with people.
Plus, when you focus on creating genuine relationships, it’s easier to develop multiple streams of income so you have options in case one source slows down or dries up completely.
With dropshipping, sometimes entire businesses fail without ever reaching these milestones—or without even getting close to them because there’s no foundation being laid along the way. Your time is valuable; why waste it?
Branding an eCommerce business will be easier with affiliate marketing
Building a brand from scratch requires a lot of work. You have to create an audience, persuade them to trust you, and turn them into regular customers. Affiliate marketing allows you to leverage existing audiences from your favorite brands.
This makes building your eCommerce business much easier and faster; it’s like starting with a subscriber list already built for you! Don’t worry about inventory management: When running your own store, figuring out how much of each product to stock, where to source it, and storing it all can be quite time-consuming—and if it isn’t done right, can also lead to out-of-stock products or items that have been sitting in storage too long going bad.
The worst part? Since these decisions are ultimately up to you, poor planning could damage your brand’s reputation. To avoid these problems, dropshipping gives you access to big vendors who handle their own inventories—you just pay a commission fee when orders come through (typically 10-15%).
Overcome issues around returns: Anyone who has run an online store knows one of its biggest challenges is dealing with returns from unhappy customers. It can be emotionally draining not only because you need to resolve complaints but also to refund money and resend replacement items at no extra cost.
What you need to know about affiliate marketing and drop shipping are two viable ways to begin an online business. When it comes down to which option you choose, it really depends on your individual priorities and goals.
Some people want to start a business right away with minimal capital, while others may want to take a slower approach with a lower risk of failure or loss.
Whatever your preference, you can’t go wrong with either option and there will always be room for growth within both methods if you follow some key tips we’ve outlined in our guide here.
What are your thoughts? Would love to hear from anyone who has experience with affiliate marketing or drop shipping! Share any insights or advice in the comments below!