It can be confusing as terms like "reseller program" and "affiliate partner" are been put on websites without really explaining what the partnership is really about. To help further, we'd like to point out the advantages for each type so that you can see which one suits best for your business.
Reseller is a company or individual who directly resells a product or service to their audience via their own website under their own brand name. The customer is your customer, you are free to decide your own profit markup. Customers interact with your brand directly.
A reseller opens his or her VPN reseller account and then sells VPN. The reseller provides the 1st line support for his or her customers, backed up when needed by VPNresellers support.
If you are a Technology company, Hosting provider or Entrepreneur, a Reseller program is the right choice for you. You will be able to extend the range of provided services offering VPN to your customers.
Affiliate is a company or individual who promotes a product or service from another company to their audience, in exchange for a commission on the sale when such occurs.
You are strictly an evangelist for someone else's service. You refer customers to another company, where they open their own accounts with the affiliate's code or link. The customer is not your customer nor do you do the transaction, you cannot decide your markup for profit.
If you are a blogger or industry news website owner, an Affiliate program will be most beneficial for you.
Are there exceptions? Yes there are! We have seen huge success of an IPTV related blog that became a reseller and offers their audience a VPN service under their own brand name. They primarily did this to have a more stable and recurring revenue flow.
Pros and Cons of Reseller versus Affiliate
Reseller Pros
- Low Startup Costs — When you start a reseller business all you need to invest in is a website and marketing. There are no infrastructure costs, and you only pay for what you have sold.
- Create a Scalable Business — With a reseller business, you can expand your revenue near infinity. In the VPN example, you are not selling your time for money, so your revenue can scale. All you need to focus on is signing up more customers.
- High-Quality Service with Less Work — By partnering with a quality reseller business you're selling their services under your name. If you partner with a company whose service you love, then you'll be able to pass on this same quality of service.
Reseller Cons
- You Don't Have Complete Control — As a reseller, you won't have complete control over all aspects of your business. You can control most of the front end, but the back end service or product is all dependent on the company you align yourself with.
Affiliate Pros
- Easy to Get Started — All you need to get started with affiliate marketing is a link. Once you have your unique tracking link you can promote this to your existing social media audience.
- Low Level of Responsibility — Once you've referred a customer to a company, your work stops there. You don't have to deliver on the product or service.
Affiliate Cons
- Commission Only Sale — Unlike running your own business, you don't really have the opportunity to grow your income via upsells. You're also limited by the commission that the affiliate company is willing to pay out.
- Sales Aren't Guaranteed — There are no guarantees in the world of affiliate marketing. Just because you sent a lead to a company doesn't mean that person is going to follow through with the sale.