Dropshipping vs Affiliate Marketing: Which to Choose?

If you’re new to online business, you’ve probably asked yourself: “Should I start with dropshipping or affiliate marketing?”

Both models involve selling other people’s products. Both can be profitable. But the truth is, they are very different in terms of effort, control, and long-term potential.

I’ve built businesses with both models over the past decade. In this post, I’ll break down the differences, highlight the pros and cons, and show you why, if your goal is to build a real, scalable business, dropshipping wins every time.

What Is Affiliate Marketing?

Affiliate marketing means promoting someone else’s product in exchange for a commission when you generate a sale.

Example: Write a review of your favorite pen, share a link to Amazon, and if someone buys through your link, you earn 2–8% of the sale.

Benefits of Affiliate Marketing

• No order processing → You’re just sending traffic.
• No customer service → Issues go to the retailer, not you.
• Low barrier to entry → Anyone can sign up for an affiliate program and start linking.

Downsides of Affiliate Marketing

• Low commissions → Typically 2–8%. Sell a $1,000 product, make $20–$80.
• Limited traffic options → Google Shopping and most paid traffic platforms don’t allow affiliate-only sites. You’re often stuck relying on SEO or influencer marketing.
• No customer data → You’re sending valuable customers to someone else’s site. They keep the emails, the lifetime value, and the ability to upsell.
• Less sellable asset → Affiliate sites can sell, but they rarely command high multiples compared to eCommerce stores.

What Is Dropshipping?

Dropshipping is a retail fulfillment model where you sell products online without holding inventory.

When a customer buys from your store, you forward the order to your supplier, and they ship it directly to your customer. You control the website, the checkout process, and the customer relationship.

Benefits of Dropshipping

• Higher profits → Expect 25–30% net margins on high-ticket items. That same $1,000 paddle board that pays $80 in affiliate commission could net you $300 profit as a dropshipper.
• More traffic sources → Google Shopping Ads, search ads, retargeting, email marketing—all available to you.
• Control over customer data → You own the relationship, email list, and purchase history. You can upsell, run promotions, and drive repeat sales.
• Build a sellable business → A profitable dropshipping store with consistent revenue is a true asset, often selling for 30–40x monthly profit.

Downsides of Dropshipping

• Order processing & customer service → You handle payments and support. But if you sell high-ticket items, volume is low, meaning fewer support requests.
• Supplier relationships matter → You must get approved with real suppliers (not middlemen).

Dropshipping vs Affiliate Marketing: Paddle Board Example

Let’s say you post a YouTube video reviewing paddle boards.

• Affiliate model:
  Refer traffic to a retailer, earn 8% commission → $1,000 sale = $80 commission.
• Dropshipping model:
  Sell directly through your Shopify store with approved suppliers. $1,000 sale at 30% margin = $300 profit.

Same audience. Same work creating the content. More than double the profit with dropshipping, and you own the customer.

Which Model Should You Choose?

If you just want to dabble in content and earn a little side income, affiliate marketing might be fine.

But if you want a real business you can scale, control, and eventually sell?
Dropshipping wins. Every time.

That’s why I’ve spent the last decade teaching entrepreneurs how to build high-ticket dropshipping stores, not affiliate sites.

This topic was also covered in a previously recorded video. I post videos weekly to my YouTube channel so be sure to subscribe and share your top takeaways with myself and the rest of our community. Your comments keep me going, so please drop me a message or just say hi.