Affiliates vs E-commerce, what is the best approach for this niche?

[MrSanti]

I'm starting my next project. Soon I'll start another cool journal ^^. It's on a little niche that I found really promising, on the tech vertical.


I've done research on almost all the competitors on my local language. On this specific niche, I found two approaches in the field:

- One side. Made mainly of a few small e-commerce stores, with just a list of products, and not much content. They use a few ads to get traffic, and most of them rank for different product brand keywords they have in their stores.

- The other side. Made of affiliate sites. All informative content. They rank for the biggest keywords, and send all the traffic to Amazon affiliates.


Having this in mind, I have some doubts about making and structuring my website.

- The thing is, the products they are marketing are easy to dropship. I found a few distributors that could even ship it in 1-3 days to the customer. And I can get between 50-100 bucks for every sell, instead of using the Amazon affiliates program (they are high ticket items). Is there any benefit using the Amazon affiliates instead of just doing dropshipping? Because on Amazon I would get only a 3% commission, while doing dropshipping I can get way more.
I want to make some content to rank on SEO too. Some affiliates competitor keywords should be really easy to destroy. They are just getting no-follow backlinks from random blog comments. And I'm going to start working a bit more on my traffic leaking techniques, after reading the CC9

- Considering the last decision, I don't know how I should structure the website because I have a few options: If I decide to go with Amazon affiliates I would just design it as an affiliates "Informative" website, linking the main content on the Homepage; but on the other side. If I decide to dropship and make my own store. Is it more optimal to make a full e-commerce store, market it as a brand, with a full list of items, an Amazon like design, and then have all the content that I want to rank linked in a Resources category, or something like that in the Toolbar. Or is it better to structure the website linking the main content in the Homepage, and make it look like an informative affiliates site, and then have a little store linked in the main nav?

I too thought about combining the two, but It's a bit weird. By combining the two I mean, make a full Informative Affiliates website, where I would link some products to Amazon. And then have a small store with a few products, so from some reviews I can link both, my own store link to the product, and Amazon link, so the customer can decide. The thing is, If I manage to design the website as a big brand, I should have enough trust from the customer to have proper CTR right?
And another option, but a bit more difficult. Would be to make two different websites. One informative affiliates sites with only full content, and another brand with a different domain as a full e-commerce store. So I would send the traffic from the affiliates sites to my own store, and then on the store work on other traffic sources, but It will became a headache, marketing 2 websites, and try to avoid cutting traffic from one to the other combining properly all the marketing efforts.


What would you guys do, I've had a headache for 2-3 days now taking fucking decisions haha. I'm going to stick to this project for the next 6 months-1 year and I want to give it my best shot

 

[Ryuzaki]

I'll take a stab at this:

Site Purpose
A site needs a core reason to exist, for two reasons: 1) Your own clarity and direction. You need to have a clear goal with measurable key performance indicators that give you feed back on what's working or not, what to improve, what has the best ROI, etc. 2) Your users need to understand the purpose and direction of the site, too. If your site is scatter-brained then so will be the user experience for people you convert into brand followers (as opposed to people that look at one page from the search engines and bounce).

I think a site needs a single, primary identity. In your case that's either eCommerce or Informational Authority Site.

In my time on these here interwebs I've seen several friends try to tack an eCommerce store onto their main site. It never went well, and they all end up moving to eBay or Etsy where the traffic already exists and the users are in the right frame of mind to purchase stuff. They're originally on the site seeking information. They're not likely to buy something, and even if you play the numbers game it's still going to be low earnings that don't warrant the effort. That's what I've seen happen.

If you look about, most of the time you see a blog or authority site open up a "store" it's usually just crap like t-shirts, bumper stickers, coffee mugs, and all of that is print-on-demand. It's nothing serious and they likely don't make serious money. If you're a personality, though, like a YouTube star or musician, you can make some serious cash on this stuff. But a brand website, I haven't seen it become a big thing, and I think that's largely because of user intent.

On the other hand, every brand and eCommerce store usually takes advantage of blogging to attract traffic to raise awareness that they exist and continue reminding people of that fact. They don't make much direct money from this. When some CRM SaaS decides to rank for terms like "How to create a new layer in Photoshop" they make zero direct money from that and ultimately zero money from those users ever. They just want people to know they exist in the off-chance some Photoshop user ends up needing a customer relations management tool in the future and remembers them. It's a numbers game, not unlike Coca-Cola buying a billboard and a Superbowl TV commercial slot. Coke can do that because they nearly dominate their market and have existed forever.

The Conversion
You're saying you can easily dropship items that will make you $50 - $100 a sale, versus sending the traffic to Amazon and making $1.50 - $3.00 per sale. The question becomes, will Amazon net you over a 33x better conversion rate? If not, then dropship. If so, then go with Amazon.

Amazon is good, but I doubt they'd be 33x as good at converting if you build something decent and do some split testing and stock good products. And with $100 a sale you have a lot of wiggle room in terms of Cost Per Acquisition on a customer. And depending on what you're selling, you might even get repeat sales or a higher average earnings per customer if they fill up their cart.

Another option would be to order stock, white label it, and do Fulfillment By Amazon. Then recommend your product as the best. You could even white label it as a brand that's not your authority site's brand so people don't think you're one and the same. That lets you sell each piece separately too (in a liquidation event), and if you can climb the ranks, other Amazon Affiliates might recommend your product.

I wouldn't make two websites unless you have the cash for content development and link building. You'll either get nowhere or get to your goal in twice the amount of time it would take otherwise, when it comes to SEO.

With eCommerce and a decent revenue per sale ($100) you should be able to take advantage of PPC, optimize campaigns on a ton of channels (Facebook Ads, Google Adwords, Reddit Ads, Instagram Ads, Bing, whatever) and start printing money immediately instead of sitting on your hands waiting for SEO to kick in for $3 per sale.

That's assuming the product is good, the demand is there, you can write the ad copy, you can build the store and optimize it for conversions, etc. It's also assuming that your interpretation of the market is accurate and people are buying this stuff and willing to buy it from a smaller store. You'll want to validate the whole concept first, if it's not something that obviously sells like fitness equipment or whatever.

You should be able to find data about what's selling on Amazon, how many sales they make (estimated), the historical prices, etc. That can help you start validating the demand anyways.

____

Based on what you've said and nothing more, I'd do the eCommerce. I'd possibly say the opposite if I knew more information. But at the end of the day you have to make a move, and I wouldn't try to be some kind of hybrid website. I've never seen it work out.

I'd also say to not pussy foot around and lose time. Go for the vision that has a higher ceiling. You can spend the same amount of effort creating an asset that you flip for $30k as you can for one you end up selling for $3 million.

 

[MrSanti]

Hey @Ryuzaki! How is it going?

I've been thinking and now I have a clearer view thanks to your answer.

I think I'm going to move towards building an Informational Authority Site.
I would love to make an e-commerce website. It has a lot of potential on this niche, and clearly the best ROI. The problem is that as you say, the ideal marketing methods are ads, and right now I barely have just enough money to stay alive haha. So I can't really invest too much and it wouldn't make too much sense.

My idea was to make a hybrid, and get traffic, just by working, trying to avoid paid marketing channels.
So what I'm thinking in terms of strategy, if hybrids don't really work. It's to first go for an Informational Site. If I start generating some money, get a good white labeled product and market it on FBA. And if that goes well too, use all the resources to make an e-commerce.

Now about validating the niche. I fucked up really good on my last 2-3 projects, but with all the new knowledge I think that this is a proper one. I'm still a bit noob, so I might go down again head first though.

I'm following the crash course, so I'm focusing on a vertical instead of a really small niche, even though at first, I'm just going to focus on the niche, and maybe later expand.
All my competitors have the "main keyword" on their domain name, so they are limited to that narrowed down niche, It's almost like a category of products.

It's something like this:
Tech ==> Vertical ==> Sub-Vertical I'm targeting ==> Niche

The "main keyword" has about 200k monthly searches according to Ubersuggest. The first position is Amazon with 0 backlinks, followed by 2-3 big chain stores on my country, and after that, some of my competitors.
I'm not going to target this keyword though. I was thinking about focusing on buying intent, they are a bit easier to rank for, according to Ubersuggest, and the CTR should be way better.

This is the trend for the last 5 years on Google trends, looking for the main keyword.

The tend is upwards. A lot of people buy this gadgets for christmas. But there is a steady stream of traffic the rest of the year. It goes down at the end because of quarantine, people play with it outside, but is going up again as the government let us leave home.

On Amazon, I don't know if this is relevant at all but, by just searching the main keyword, the first one is a famous model with more than 2k reviews, the second has 17, 3rd 300, 4th 600... So I think they must be selling well.

In a few days I'll start my new journal