Affiliate marketing vs drop shipping. Is one better than the other? Is one easier than the other? That really depends on you. I’ll cover some of the similarities and differences in this article and you can decide for yourself. While each business model may require you to focus on slightly different activities, I can tell that both will require work!
NOTE: This article was written under the assumption that you do not hold any inventory. If you own an offline business and are trying to establish an online presence, see my article “How Do You Start An Online Store?”
How Are They Similar?
This will be obvious to most people but I will go ahead and mention that with either model you will need:
- A domain name
- Content management system
One of the largest similarities between affiliate marketing and drop shipping is that your goal is to sell products that you don’t own. You are essentially a “middle person”. It is not necessary to keep an inventory nor are you responsible for collecting money or shipping the items once they’ve been purchased.
Drop shipping has gained a lot of popularity in recent years and there are companies who specialize in streamlining the process for drop shippers by eliminating some steps in the process.
For example, the old process worked like this:
- Your Customer Paid You For Their Order
- You Bought The Product At A Lower Price
- The Product Was Shipped To You
- You Shipped The Product To Your Customer
It was a bit cumbersome. Especially if you were working in an industry with low profit margins. However, there are now companies that make it easy to allow your customers to purchase directly from manufacturers leaving you with the profits. Products are then packaged, labeled and sent directly to your customers. In this way, drop shipping is much more like affiliate marketing now. Hence, its growing popularity.
As a drop shipper, it is you who determines the retail price of your products. This gives you more control over your profit margins if you don’t have competitors selling those same items noticeably cheaper. Drop shipping can be a cut-throat business and some people will comparison shop.
With affiliate marketing, you have no say in the price. You earn a percentage of the sale which varies from one affiliate program to another. Affiliate marketing is a great way to sell digital products which often pays 50% and sometimes as high as 75%!
Marketing Your Business
Your goal should be to get your website in front of as many eyeballs as possible. That is what marketing is all about.
Search Engine Optimization is a technique that is heavily relied upon among affiliate marketers. It is more keyword focused than product focused. They aim to produce quality content that is worthy of high search engine page rank and work on honing their writing skills to convert visitors into customers.
Online stores that are usually built by drop shippers are more visual and product focused which can make SEO challenging. Since other drop shippers will likely be using the same images and product descriptions, this will be seen by search engines as duplicate content which won’t win any favors with them.
If possible, you should write your own product description and be thorough! 350 – 500 words seems to be the industry consensus but can you really write 500 words for a shirt description? Probably not, and that’s why you should consider having a blog within your drop shipping store.
A blog is a great way to share industry news and tell people about the latest offerings in your store.
Social media is very visually oriented and can be a very effective way to get you online store in front of people. People who have learned to master Pinterest can earn a full time income just posting product images that lead people back to their stores.
It can take time to build a substantial pinterest following but if you can generate enough traffic to make regular sales, you may not even need to worry so much about SEO.
Of course, we can’t forget about the visual and viral effects of Facebook, but did you know that Facebook now lets you set up an online store? Yep, you can sell products directly from a Facebook store. Pretty cool stuff!
I have only touched on 2 of the more popular social media platforms but there are plenty more. As a drop shipper, you will want to take advantage of as many as possible!
Email marketing is probably one of the best ways to ensure future sales. Blasting out a product offer to thousands of subscribers with a single email has proven time and time again to produce massive sales! It doesn’t mater if you do drop shipping or affiliate marketing. Email marketing definitely needs to be part of your marketing efforts at some point!
If I have to choose between affiliate marketing vs drop shipping, I would go with affiliate marketing. You can build an online store either way but affiliate marketing has a couple of features I prefer.
1. Brand recognition
Amazon.com has the most popular affiliate program in the world. People know and trust amazon as opposed to many of the companies you will be dealing with in the drop shipping business. Plus, if you send a customer to amazon.com though your affiliate link, you earn commissions on everything they buy during that session. Since most people do not order only 1 item from amazon, you have tons of opportunities for unexpected sales!
2. Shorter ETA’s
The estimated time of arrival with drop shipping orders can often be 3 to 4 weeks or longer! In this world of instant gratification, many people simply won’t be willing to wait that long for an order. Especially considering that most affiliate sites offer 2 – 3 day shipping.
Bear in mind this is my personal opinion! I would certainly never want to deter anyone from starting a drop shipping business and I can assure you that there are plenty of highly successful drop shippers out there.
Whichever route you choose to go when building your online business, understand that there will be a learning curve and there will be a lot of work.
Fortunately, all of the training and tools you need are available in one location and you can start for free today!