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As they say, "No pain, no gain". Having your own store pays very well, but requires a substantial time investment from you.
On other hand, if you sign up for an affiliate program, all you need to do is set up a website to promote program. All ads, banners, marketing text etc will be provided to you by affiliate program. Your only responsibilities would be to get people to visit your website, and hopefully click on affiliate links to buy products that you are promoting.
3) CONVERSION
Whether you have your own business or are promoting an affiliate program, bottom line is conversion rate, or percentage of visitors that actually buy something from you. A number of factors influence this conversion rate. Factors as quality of product, quality of website, customer support are all important. However, I personally believe that most important factor is trust.
When a potential customer arrives at your website, he will need to trust your site enough for him to be willing to buy from you. After all, on internet you are just a faceless salesman. He doesn't know who is actually running site and whether he will actually get goods that he orders.
Having said that, one of key methods of garnering trust is by recommendation and referral. If a store is being referred to or recommended by another website, potential customer will feel that store is trustworthy. After all, if store is not trustworthy, why would other website recommend it?
This is where affiliate programs shine. When you refer a potential customer to store for which you are an affiliate, customer will feel more relieved, since store is being recommended by your site, a 3rd party. The customer will be more likely to buy from store, benefiting both store, and you as well.
There are both pros and cons to joining an affiliate program. You might earn less with an affiliate program compared to starting your own store, but I believe benefits of not having to be responsible for logistics makes affiliate programs are very viable "passive" source of income.
For more information on affiliate programs, do visit http://www.onlinebiz-help.com
Steven is the webmaster of http://www.onlinebiz-help.com - Your Guide To Internet Business. His website contains various resources on affiliate programs and internet marketing advice to help you succeed in your internet business.