As a newcomer to Make Money Online models, you might not know what to start between eCommerce business, Affiliate marketing, and dropshipping. This blog helps!
Statista published in Sep 2020 that e-commerce had played an indispensable role in the global retail landscape when 1.92 billion people were estimated to purchase online, and 3.5 trillion U.S dollars were earned by e-commerce sellers worldwide. Even under the impact of COVID-19, the ecommerce sales have been standing at a record because online demands are exceptionally high.
This is the chance for you to start making money online!
However, there are billions of people out there who share the same ideas. The opportunities go hand in hand with increasing competitiveness. For that reason, choosing the right MMO strategy is very important. You can earn millions in a short time - or nothing.
As a beginner, you might start with online selling, dropshipping, or affiliate marketing.
A Brief Comparison
|
Criteria |
Online Selling |
Dropshipping |
Affiliate Marketing |
|
How does it work? |
Typically, you will sell products/services online via an online website, ecommerce marketplace, social media, etc. It is you who handle the inventory, make marketing efforts, and even deliver the products/services to the end-users. |
You will neither store inventory nor make the shipment. Instead, you will try to market the products/services, receive orders from customers and transfer them to the manufacturers/sellers. The profit is based on arbitrage. |
You will not sell anything. Rather than that, you will take the role of experts or dedicated consumers who refer others to consume products/services. Then, you will receive the commission from sellers. |
|
Business model |
It is much similar to traditional businesses, except for the fact that the customers will make online orders instead of going to physical stores. |
The money you earn is the difference between your selling price and the wholesale price. |
The profit is the commission on the products/services that are purchased after consumers refer to your recommendations. |
|
Business management |
The consumers buy on your online stores/selling channels. Then, they will directly pay to you. |
You sell products that are not managed by you. Nonetheless, customers will pay to you before you pay to the manufacturers or wholesale sellers who make the shipment. |
You will publish reviews on products. Whenever a consumer clicked on the affiliate link on your site and come to a final deal, the manufacturer will record and pay to you later. |
Online Selling, Dropshipping, and Affiliate: Which Is The Most Common?
So far, online selling on an ecommerce website is the most common among the three MMO models. Affiliate marketing comes second. And, dropshipping has the smallest community.
The most common is Online selling
NOW, create FIRST ONLINE WEBSITE with the Shopify platform in 2 HOURS!
Although selling online is the most complex MMO model so far, the number of people who decide to create a website to sell their products is outperforming any other models.
This makes sense because this business model allows taking full control over the profits rather than having low percentages or differences like what you earn from affiliate marketing and dropshipping. Moreover, online selling has a very long history, and it is now expanded with more profitable selling channels and strategies.
The second is Affiliate marketing
You can start affiliate marketing with a laptop and nothing else!
It was in 1989 when the concept of affiliate marketing was first introduced. However, only when Amazon opened its associate program in 1996 did affiliate marketing gain global interest.
As an affiliate marketer, you must consult as many consumers about the products and services as possible, and you are paid a commission on products/services sold. Almost everyone can join the program, and they do not even have to involve in customer support or order fulfilment processes. Such a simple idea attracts a large number of online marketers and even normal consumers to register to an affiliate program.
Now that almost all ecommerce marketplaces and platforms offer affiliate programs, the community is expanding day by day.
Dropshipping - The smallest community
Start dropshipping with almost no initial cost, how? >>> Use SHOPIFY platform and apps!
Dropshipping is the latecomer to the MMO models. However, if you do a research, you will find out that the community of drop-shippers has been increasing significantly in the last few years - especially in the time of 2016 to 2018.
To tell the truth, dropshipping is somewhere between online selling and affiliate marketing.
On the one hand, a drop-shipper does not need to face any entry barrier because similar to affiliate marketing, all required are domain and hosting. Nonetheless, the drop-shippers will show themselves bigger during an online purchase journey from marketing to consulting customers, and to proceeding the payment and post-purchase support.
Online Selling, Dropshipping, and Affiliate: Which Is The Most Profitable?
Again, online selling offers more opportunities to earn money online. But surprisingly, dropshipping seems to be more profitable than affiliate marketing despite its smaller community.
Online selling: highest Investment - Biggest Profit
The starting cost is high, but the profit is well-worth.
Since you sell products/services independently, the profit and loss are based on your all efforts. You need to improve yourself with a business mind to control the expense, manage all processes, and get the most sales opportunities. When the business grows, you will even need to hire extra human resources and tools to keep up with the demands.
Dropshipping: Lower investment but bigger profit
Compared to online selling, dropshipping requires less money, whereas you have to come up with lots of strategies to keep your online business afloat. Unfortunately, many people have given up on the dropshipping, claiming that they get less money out of such efforts.
It is somewhat true that the low-profit margin makes the dropshipping less prevalent than it used to be. Nonetheless, we confirm that dropshipping is not dead yet. It is still alive and keeps making profits - as long as you get the best dropshipping niches and try to cut down the initial cost.
Affiliate marketing: Lowest investment and smaller profit
You hardly have chances to deal over affiliate commissions!
Affiliate marketing costs nothing rather than the dedication you spend on the product reviews because it is almost free to start a WordPress blog or so. However, the most significant disadvantage is the fixed commission. No matter how much you pour on the affiliate website and traffic gathering, the commission does not change for years to come - mostly because of the competitiveness of this community.
All in All, What MMO Models to Use in 2020?
You might already choose by referring to all advantages or disadvantages of the three models. In case you still do not decide, we strongly recommend starting with Dropshipping and then online selling.
For good reasons ...
In general, whatever the online models you use, you still need to build an online website. Then, why don't you spend more time and effort to make it shoppable and get sales? In the end, you will get better control over your work and make a higher profit.
No worries if you do not have enough resources to build and manage inventory because you can sell as a drop-shipper. Simply, find a niche product and get connected with the manufacturers or wholesalers to sell their products legally.
Then, when you have enough money and experiences in ecommerce, you can make use of your brand awareness and start your own business.
How Does Shopify Help with Dropshipping and Online Selling?
Now that you already decide to do dropship or sell on your own, you will be happy to know that Shopify provides all essential tools and practices to do as your requirements.
Shopify offers a 14-day trial to build an online store and start selling to your potential customers. We truly think that the time is enough to visualise your business ideas and test whether they are profitable, Even when you need more time, you can subscribe to a basic pricing plan which is affordable around $20.
We appreciate that Shopify builds all functions and documentations with the entry-level sellers who have little knowledge in business and ecommerce. Accordingly, if you do not know where to start and what to do, step-by-step instructions will be available at your fingertips.
Not only does Shopify provide helpful user guides and user-friendly interface, but it also builds a Shopify Appstore where you can find and install Drop Shipping and many apps to improve your websites and close the sealed sales.
Can't wait to try out Shopify? Then no beat around the bush, just subscribe to the FREE trial and explore all by yourself.
CREATE A FREE ONLINE STORE NOW!
Disclaimer: BSS Commerce is one of the leading e-commerce solution providers in Southeast Asia. We are a reliable app provider on Shopify Appstore and also an affiliate partner of Shopify who promises to offer you the most valuable information about this helpful ecommerce platform. Feel free to enjoy.