Affiliate Marketing and Ecommerce: Nowadays, launching an online business is easy, and it can be an exciting feat for budding entrepreneurs. Moreover, starting an online marketplace has its benefit compared to traditional offline stores. You do not have to incur overheads in rent, power bills, and hiring salespeople. So, an online store enables entrepreneurs to enjoy steady profits while having low overhead.
However, there is high competition in the online marketplace, and you need to come up with different business models to sustain the business. You can no longer open a website, offer products, and expect people to show up on the website.
While there are a variety of online business models, affiliate marketing and ecommerce are popular business models that can yield great results.
So, if you are an entrepreneur scrutinising to start an online business, you must know the difference between ecommerce and affiliate marketing to make the best decision.
- Easier to set up
If you are aspiring to operate as an affiliate, you do not have to worry about setting up an ecommerce platform that will save you a lot of money. You do not have to worry about setting payment systems, warehousing, dropshipping, and other overheads if you are operating as an affiliate.
- It is all about linking the right products
As an affiliate, you simply have to place the affiliate links of third-party products along with the description, and once any of the customers buys the product, you earn a commission from the seller.
- No overheads
Affiliates save money as they do not have to hire any staff for customer service since they sell third-party products. However, as a good affiliate, you must take care of the visitors and the customers to establish a good presence.
- A source of passive income
Another benefit of being an affiliate is earning commissions you might not have promoted or seen. This happens because once a visitor has opened the third-party product website using your link, then no matter what product they buy, you would get the commissions. As long as the customer landing on the website from your link buys any product, you would be entitled to a commission. Moreover, you could be taking a week off, but as long as people are buying from your links, you are earning a commission, making this a great source of passive income.
You can know the difference between ecommerce and affiliate marketing based on the ecommerce model.
- Better margins
When you operate as an affiliate, you get commissions, but you enjoy greater margins on the products when you run an ecommerce platform. You get to set your margins as opposed to affiliates who have a set percentage of commission.
- Control over the day-to-day operations
Running an ecommerce business gives entrepreneurs more control over everyday decisions. Meanwhile, affiliates have a limited scope of working and can’t make any decisions related to the products.
- Dropshipping is an asset for ecommerce
Owing to the benefits of dropshipping, ecommerce entrepreneurs do not have to keep any stock with them. When an end consumer buys the product from the website, it is directly shipped from the manufacturer or distributor’s warehouse. So, an ecommerce that takes advantage of dropshipping does not have to worry about stock, inventory, and other storage-related overheads.
So, if you are an entrepreneur who likes autonomy and wishes to control every aspect of the business, ecommerce is the best choice for you. On the other hand, if you want to focus solely on charting marketing strategies and maintaining a website, you must consider operating as an affiliate.