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How to Sell Digital Products & Downloads: The Complete Guide

Still wondering what digital product to sell and how to sell it?

Still wondering what digital product to sell and how to sell it?

I have been there. Since 2008, I have sold every type of product (digital, physical, SaaS, services) under the sun. I’ve tested a lot of markets, some failed and some didn’t.

I recently wrote about selling what physical products to sell online but digital goods could be your go-to.

They are tempting because they more simpler to run compared to physical products. You wouldn’t have to deal with the hassles of shipping and inventory.

However, just jumping into the wagon of selling downloadable products online without a concrete strategy can hamper your sales. Selling online is much more than just uploading your products on your website or online store and expecting buyers to troop in. Many people make this mistake of running in without an understanding of how it works.

Seeing this, I wrote this in-depth guide that’s designed to help you get a smooth ride.

Seeing this, I wrote this in-depth guide that’s designed to help you get a smooth ride.


Types Of Digital Products To Sell

Digital commerce is a huge segment in itself. Since you’re probably not a movie producer or rap star, we’re going to leave out video and music. Our focus is on the popular paths for online entrepreneurs:

  • ePublishing/eBooks – Selling information in digital books.
  • Online Courses – Selling information in protected content.
  • SaaS Products – Selling software products.

EPublishing/EBooks Market Growth

eBooks are the fastest growing digital product online. 2016 revenue is roughly $16 billion. Compound annual growth is projected to be around 16% between 2016 and 2020.

Overall growth during that time span is expected around 93% – making eBooks the biggest growth segment overall. Expected sales in 2020 is $29 billion.

Pros and cons of selling ebooks

You wouldn’t have to deal with inventory or shipping with eBooks. You can control your margins and set your own price. But you need to have some kind of expertise to make and sell eBooks; you can only write what you know.

Ebooks are super easy to plagiarize. Once someone has an ebook, they can load it up to the internet for anyone to read. Even if people buy, you can only sell an ebook once, vs a SaaS product.

Self-Paced E-Learning/Online Courses Market Growth

While the overall numbers for eLearning (corporate, universities) are massive, this report shows dismal growth in the self-paced eLearning market. In the US, sales of online courses actually decreased in 2015.

These figures include retail packaged content, custom content development services, and authoring tools/platforms.

Pros and cons of selling online courses

Your advantages in giving online courses are pretty much the same with the eBooks – no inventory and higher profit margin. On the other hand, you need expertise to teach something and getting this knowledge and experience could take time. It’s also slow to revenue and has a lower ceiling.

If you don’t have the desire to build a strong personal brand, selling info products like courses won’t work.

Software-As-A-Service (SaaS) Market Growth

The global SaaS market is estimated at around $78 billion in 2015 and is expected to grow to a $132 billion dollar industry in 2020 (69%).

Pros and cons of selling SaaS

Like every other digital product, with SaaS, you don’t have to deal with inventory and shipping. Another good part is that you have a higher ceiling and a higher control over the price of your product. The downside is that it’s resource intensive. You’ll need to get different skills/people on board, and it takes a lot of time to generate revenue.

Selling Digital Products Vs Physical Products

There are benefits of selling digital products as against physical products and vice versa.

For digital downloads,you can get an unlimited warehouse on the internet. On the other hand, with physical products, you can easily demonstrate their value. The reason is that they are tangible so their purpose is easier to explain.

The truth remains that whichever one you want to sell, as long as you chose the right products and use the right tactics, you can scale.

Experience goes a long way, which is why I asked 18 entrepreneurs the following question:  what’s the single biggest advantage of selling digital vs physical products? I also want you to answer the flip side of that question.

Let’s take a look at first why you should sell digital over physical.

Why Sell Digital Products Over Physical

  • High profit margin
  • No shipping cost
  • No shipping restrictions
  • No storage space and cost
  • No inventory shortage
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