Affiliate Marketing Vs Amazon FBA: Which Is The Better Business Model?
A business model is one of the essential components of a business since it’s what decides whether an enterprise makes money or not. As a business owner, you must choose a model that works perfectly for your enterprise. Alas, the number of business models is too many to count so it can be challenging to know which to choose. Among these options, two models often compared with each other are affiliate marketing and Amazon FBA.
A Brief Overview
If you’ve been looking into business models lately, you’ve probably seen these two terms jumbled together numerous times. This is because these two are similar in the sense that they both involve handing over certain responsibilities to other organizations or individuals outside of your business. It’d be best to discuss what each model does.
- Affiliate Marketing
The affiliate marketing business model is when an affiliate and a business enter a partnership. It’s a give-and-take relationship where the affiliate promotes your products or services to their audience. Some affiliate programs have a low commission while others have high commissions, and these are what you call high ticket affiliate marketing networks. Whenever you make a sale out of their efforts, they receive a commission.
- Amazon FBA
Amazon FBA, also known as Fulfillment by Amazon, is a service where you, the seller, let Amazon fulfill orders for you. They’ll handle things like delivery, packaging, refunds, returns, warehousing, and many more.
While you can undoubtedly find some differences between the two, the fact remains that both business models can potentially save you time.
According to Amazing Selling Machine review, Amazon FBA is just like affiliate marketing, but you’re relying on Amazon instead of influencers or content creators. That’s why many people compare them with each other. Nonetheless, you should first understand what each offers as a business model.
Affiliate Marketing As A Business Model
Since affiliate marketing is a marketing strategy, the benefits you’ll get from using this business model is similar to that of other marketing strategies such as:
- Improved Brand Awareness
By practically employing numerous content creators and influencers to promote your product, you can essentially make more people aware of your brand.
- Credible Social Proof
Social proof is a phenomenon where individuals copy the actions of others. It’s a common occurrence among influencers where customers follow them. If you can get a few influencers to feature your business, their audience would follow suit.
- Broader Scope
With affiliate marketing, there’s no limit to who you want to turn into an affiliate. It can be someone in the health, fashion, or sports industry. By employing these individuals, you can expand your reach to industries you never thought you’d reach.
Based on its benefits, it should be apparent that affiliate marketing is a business model focusing on market reach. Take note of this as it’s necessary when making the verdict.
Amazon FBA As A Business Model
Just like affiliate marketing, Amazon FBA also has its fair share of benefits as a business model. Some may argue that it has even more advantages than most business models since it involves a big corporation like Amazon. These benefits include:
- Discounts On Shipping Fees
When using Amazon to ship your items, you usually have to pay a fee. However, if you employ their help via their FBA services, the shipping costs will be lower.
- Seamless Returns And Refunds
Returns and refunds are often difficult to deal with. You have to track the order number, undo several steps, and more. Using Amazon FBA makes this process easier.
- Great Customer Support
Amazon FBA also has its own team to handle inquiries from your customers if they ever have some questions. This will save you money from hiring a staff dedicated to customer service, and Amazon’s team is also often more experienced than most.
- More Storage Space
It’s only normal to assume that Amazon would have a massive warehouse for their products. If you plan on selling your products in large quantities, the storage space of their warehouse would be adequate and may even have extra space.
This time, Amazon FBA focuses on work efficiency, particularly regarding order fulfillment. So, which is the better business model between the two?
Which Is A Better Business Model?
As you may have already guessed, these two business models aren’t exactly mutually exclusive. You can use affiliate marketing in conjunction with Amazon FBA and vice versa. In other words, it’s not a matter of which is the better business model since it still depends on your priority. If you want to focus on market reach, affiliate marketing would be better. If your priority is work efficiency, Amazon FBA would be more ideal.
