Building Your Online Business: Drop Shipping Vs. Affiliate Marketing

Setting up a storefront online is a popular method of earning an income online. There are several methods for opening an ecommerce website but the two most popular types of stores utilize either drop shippers or affiliate marketers.

What is Drop Shipping?

Drop shipping allows a store owner to include a large number of items without having to purchase the merchandise up front, or warehouse it either at home or in a separate building. Drop shippers warehouse the items and also take care of the shipping to customers. A good drop shipper will allow you to upload your own shipping labels and packaging materials so that items appear to come directly from your store.

What is Affiliate Marketing?

Affiliate marketing pays a store owner a percentage of the purchase price for every item sold that is sent to them from your website. Items are not purchased from your store, through your cart, and are not labeled as though they come from you.

Which Type of Merchandise is Right For Your Store?

There are pros and cons to both methods of online store building. What works for some people won't work for others. It depends largely on what you expect from your store and how much work you are willing to put into it. Drop shipping has greater income possibilities but requires a little more management than affiliate marketing shops. Both drop shipping and affiliate marketing can be done in a wide variety of formats from single link ads on blogs, websites, or in email and forum signature lines but drop shipping sales work much better in a store front environment and even if you do employ the above methods of attracting consumers to your items with drop shipped merchandise you will still need a store front with a shopping cart that is compatible with drop shippers.

Affiliate marketing offers you a little greater flexibility in alternative marketing and you do not actually need your own store front. When a consumer clicks on your link for affiliate merchandise they are sent to the producer's webpage to complete the sale. If you sell drop shipper items you need to be able to complete the sale from your own site.

On the flip side drop shipping offers much higher payback and you are able to set your desired price to reflect the amount you wish to make from each item. With affiliate market products you are paid the price the affiliate marketer sets and it is often quite low per item sold.

In some cases eBusiness owners will chose to pick a combination of both drop shipped items and affiliate marketing items which can be a good way to get the best of both worlds.