What do webinars, e-books, and apps have in common?

They’re all digital products, and they’re taking a big share of consumer wallets. Whether you have a successful business and are looking to capitalize on lucrative new sales channels, or a side hustler hoping to trade their talent for recurring passive income, you can make digital products work for you.

What you’ll learn:

• What are digital products?
• Types of digital products
• Benefits of digital product sales
• 6 steps to start selling digital products
• Common digital product sales roles
• What to look for in digital selling tools

What are digital products?

A digital product is an intangible thing that customers can use on their electronic devices. While you can’t hold or touch it, a digital product is still something you can see, purchase, and consume. Making more is as simple as copying and pasting. And they’re accessed by customers through downloads, streaming, or logging onto a website.

Types of digital products

Digital products come in all shapes and file sizes. If you’re trying to make one, review the following types of products to help you understand and decide which makes the most sense for you, your abilities, and your audience.

Courses and online education

Building new skills is important for your career and passions. Online courses in everything from yoga to digital marketing can draw in big crowds. A common approach is to create a series of paid-subscription online videos hosted in a learning management system, which can include downloadable worksheets and notes. Some take the form of webinars, which are attended live and solicit donations from attendees.

Go the extra mile by offering premium office hours and live lessons to connect with students. It’s easiest to sell courses if you’re already a somewhat well-known figure in the industry, but you can always build up your reputation through a few free giveaways and trial classes.

Coaching and consulting

If you have expertise in anything, your time is valuable. Go one-on-one with paying customers to help them get off the ground in whatever their pursuit is, such as the fundamentals of business operations for a startup founder or digital transformation for a more established business.

Or go one-to-many with virtual group workshops. In this case, the digital products might be content that leads free users to this ultimately paid experience, with more paid content available to them after the fact. Show your knowledge on social media and industry forums, and lead fans back to a landing page to book coaching sessions.

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Digital templates and themes

Many entrepreneurs and businesses want to make things themselves that look good and function well, without having to build from scratch. If you have the graphic design, development, or organizational chops, products you might sell include:

• Themes for popular blogging content management systems (CMS) that make it easy to set up a brand-new, professional-looking website
• Templates for presentation decks, professional documents, and highly functional spreadsheets
• Templates for beautiful notebooks, day planners, or birthday cards
• Presets for the perfect lighting balance for photos or videos in major creative software
• UX, icon, and font kits that enable product and graphic designers to build something professional quickly

These can be sold on independent websites, through marketplace platforms, or directly through the apps they’re made for.

E-books

E-books are electronic books that can be read on a tablet, laptop, or phone. Make yours stand out through a combination of high quality, unique information, and good design. If you have a solid reputation in your field, the hook might be your perspective. The hook could also be the result of an actual study you conducted, which provides new data and statistics.

E-books can be sold through major book marketplaces and e-commerce platforms. E-books are often called “lead magnets,” a giveaway that potential customers get in exchange for filling in forms and agreeing to receive your marketing emails.

Games

Video games and mobile games need no introduction. Between app stores on everyone’s smartphones, PC marketplaces, and stores built into modern consoles, they take many forms and are being played more frequently by more people than ever before. Some have an upfront cost to buyers, some are licensed to subscription platforms (and pay developers based on playtime or downloads), and some are freemium, with in-game purchases down the road.

Licensed digital content

Not everything is made to be enjoyed on its own. Sometimes, the smart move is to sell small pieces of much larger products. Stock photography, music, designs, and videos get used in everything from ads and websites to concept art and packaging.

Marketing and film professionals dig through online marketplaces trying to avoid corny corporate stock assets, so you can stand out by making something unique and beautiful. Simply create your library, license it to the stock websites, and let the sites sell it again and again.

Memberships and communities

Information and discourse are available on social media, forums, blog comments, and countless sites trying to share content, all for free. Some free sources are amazing, but there’s also a lot of junk to sift through. Niche communities might prefer something more curated and exclusive.

That’s where the membership site comes in. You have to pay to get in, but you get what you pay for. Free of ads, free of trolls, free of bots, with every member having a literal financial stake in the community staying high quality and civil. Examples include “masterminds,” where business owners share struggles and swap leads, or communities that are built around an expert in a topic.

Music and audio

Most musicians license music to streaming platforms. They are paid based on subscriber listens, or receive a portion of ad revenue from free users. Podcasts are another popular audio product. There are platforms for premium podcasts with dedicated fan bases that offer exclusive episodes to patrons who donate monthly. The vast majority are free to listeners and collect ad and sponsorship revenue.

Premium content libraries

If you’ve had success selling individual digital products, you can offer subscriptions to a big library of all your past and future products. For example, if your e-books always deliver, past buyers may see the value in simply subscribing to your library to get early and perpetual access to future ones. The same goes for the creator who always makes new UX kits that speed up app production. Prove value and then improve your offer.

Software and apps

Once created, software can provide you with reliable subscription revenue if it serves a real market need. Apps for consumers include everything from photo and video editing to family budgeting. Apps for businesses might include complex accounting, project management software, productivity suites, and shipping coordination. If you go this route, note that tech sales is a complex and nuanced discipline that requires experience to get right.

Videos

Whether it’s an ad-supported video on a popular video streaming website or a paid exclusive sold to a major publisher, video content is among the fastest-growing formats. Production quality is important for some formats, like narratives, and less stringent for quick social media skits.

Visual art and prints

Original visual artwork with an artist’s unique stamp and style can be valuable with the rise of generative AI. It’s all about how you package it. You could sell the original file through a marketplace. You could also create on-demand coffee table books and T-shirts, or sticker sheets and posters that customers print themselves. Build a following and community through social media, and then release exclusives for your fans.

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Benefits of digital product sales

Many of us try our best to avoid paying for online information that feels like it should be free. However, creating and distributing digital products must bring in revenue to facilitate continued production. Here are some of the reasons why big companies and small players alike make the investment in digital products.

Lower upfront costs

There’s a large cost difference between a text document and a multi-platform fully featured app, but neither one needs a factory to make more of them. Once a digital product is created, it’s infinitely duplicable. Your cost of goods sold is close to zero.

Easy to distribute

You can sell digital assets directly through a website you own, or take advantage of one of hundreds of popular platforms. Many creators and businesses cross-distribute to competing channels to cover all their bases.

Flexible to challenges and opportunities

Digital products’ strengths always come back to their digital nature. They’re easy to update and adapt in response to feedback (and market changes).

Your e-book sold poorly last month? Tweak it and advertise the new change.

Have your fall stickers stopped getting preorders? Add red and green holiday themes and relaunch them.

Digital creators also benefit from being able to add more types of digital products to their offerings over time. For example, a popular graphic designer who makes ad-supported video tutorials might be able to start selling templates to their fans, selling deeper courses, and building a premium community that requires a monthly subscription.

New passive income streams

Passive income refers to revenue that doesn’t require new inputs such as labor or equipment after the initial investment. A simple example would be rent collected from a rental property.

Some digital products lend themselves to true passive income more than others. Consultations require your time, but more subscribers to a course you uploaded have very little time investment after creation. If you already sell physical products, digital ones can open up new markets while trading on the reputation you made with your traditional offerings.

It’s important to remember that every product still has costs. That same course might start running out of customers, which means you’d need to either update the product for repeat business or market it to get new business. If you can automate that marketing process, you can get closer to real passive income.

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6 steps to start selling digital products

Maybe the last section got the ideas flowing and you’re excited to get started. Or maybe the idea of actually making a digital product feels intimidating and you’re not sure how to begin. Depending on your talents and whether this is a side hustle, it can be as easy as making a new version of something you always make, or as complex as learning a skill and how to build a business at the same time.

No matter how it strikes you, this process can help you organize your efforts.

1. Brainstorm, research, and choose your products

If you’re a creative or developer, it might be obvious what you’re going to make. A photographer will take photos, though they still need to find their niche. But if you have a less obvious talent, finding the right type of digital product can take more time.

What you make depends on your knowledge, skills, and interests. Do you have an eye for fashion or a knack for speed-running games? Are there accounting mistakes that always get on your nerves or design trends you think are overblown? Play to your passions if you can.

Market research

Let’s say you settled on fashion videos. What else is out there? Who are the top creators? What are they doing? More importantly, what are they not doing? Or let’s say you decided to make a DIY accounting e-book. Does anyone else give that same info away for free? What’s their angle?

Here’s how to approach market research:

• Use social listening tools to search for relevant conversations on social media platforms and see what the general attitudes and issues are in the market.
• Dig up published research from authoritative sources, industry news outlets, and others to understand trends and get some data to work with.
• Set up a CRM to gather information gained from actual customers and leads and keep your notes current.

Choose your product

Whatever you choose, land on your first product and commit to making that one as well as you can before expanding. Focus on your differentiation, such as the target market, the quality of the product, your design, your pricing, and your personal brand.

2. Define your target market with a persona

A buyer persona is a fictional customer who has traits that represent a unique segment of the population. For example, they might be divided out by age, hobbies, income, places they like to frequent, and, importantly, the things they really believe. Here’s how to create a persona for your product:

• Use data to find basic demographic traits: See how many undergraduate accountants in southern California younger than 40 there really are to sell to before you build that ebook on building your own practice.
• Use surveys and research to understand their work: Find people to survey yourself or look for old studies, and see how they relate to their work, what skills they need to succeed, and what they believe success means.
• Go deeper with interviews: Invite a few to speak with and learn about what they worry about, what they desire, and what motivates them to challenge assumptions and uncover secrets that will help you sell to them.
• Build a starter persona: Use what you learned to make a collection of these traits that’s easy to pull up and consider when creating digital products to serve them. It helps to frame it as a story (i.e., “Mark is trying to get promoted in his accounting firm and spends a lot of his free time figuring out ways to impress his bosses”).
• Refine as you learn: Personas are a representation, so they should be subject to change as you try, fail, and succeed in the marketplace.

3. Validate your idea

This is where “failing fast” comes into play. Having a digital product idea and the skills to back it up is one thing, but seeing whether the market will support it is another. An easy first step is to ask people in your life and your target market. Show them your idea and what you have so far, and see what they think is missing and what’s working.

You can also approach this in a more standardized manner, such as running digital surveys asking about the problem you’re trying to solve. The final way to validate would simply be to check relative interest in this topic or product over time. Look at online search trends to see what’s generating interest.

4. Make an online storefront

You need a place for your potential customers to find you online. There are several routes to take. Social media marketplaces are great for reach, but your visibility is subject to private algorithms. Another option is templated website builders that include storefront functionality. They’re convenient, but many competitors will also use them, so you may have a hard time standing out, and analytics and leads are often locked down. Your last choice is to build your own site and use a sales platform on top of it. It lends itself to automation, personalization, and a better customer experience, but of course it will require a bigger upfront investment.

Many digital product creators opt for a combo, luring in leads from social platforms and handling most of their selling on their privately operated websites to control customer information and reduce transaction fees.

5. Market to drive traffic

If you’re selling digital products, you’ll need to work to stand out. Use your website and social analytics to determine where interested traffic, if any, is coming from. Try to find patterns between where they come from, what they do on your site, and when they ultimately buy. You can also find places in your buying flow where they drop off before making a purchase.

Using this data, decide on channels to invest more in, like organic content you post to your social profiles, advertising placed on search engines, or referrals from partners and groups. Part of the investment will be running these different marketing campaigns, and part of it will be creating the content you’ll use in the marketing.

Connect your CRM and sales tools to your marketing efforts to help you make stronger connections between the types of marketing a lead was exposed to, and the likelihood of buying. Marketing is a game of continuous improvement, so study your results and try tweaks as you go.

6. Test and learn

Your product and marketing efforts both require you to look at the data and adjust as needed. Always gather and be open to feedback, and investigate problems.

You will likely have to adapt to increase revenue. Since digital products are relatively low-cost to make, you need to consider your breakeven point and your time to profitability.

How many units do you need to sell to earn back everything it costs to make it, including your own labor? Also, how long did it take for that to happen?

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Common digital product sales roles

To sell a digital product, many tasks have to get done. Big product development teams have staff for each job function, whereas side hustlers have to do it all themselves. A quick overview of each role can help you see what goes into selling digital products, and figure out if you have any gaps in your team or personal skill set. Study these to help you launch successful products.

Product manager

The PM is like the CEO of a product or product line. They take the vision and break it into achievable sprints and goals, take customer feedback into account, and promote the success of the product throughout the business.

Engineer/creator

A digital product has to be created. Photographers snap pics, software developers build apps, and influencers talk, present, and film (mostly themselves). This person or group is the most important, but their work can be outsourced, too.

Design and user research

Digital products are sold in a world that’s mainly visual. If the main product isn’t made by a designer, a designer still needs to package it into something slick, sellable, and branded. User researchers have to get involved to understand how people interact with your site and content (and to see if the design is working).

Customer support

You can’t leave your buyers in the cold. Once they’ve given you their money, you need to honor your promises, including helping them figure out when something isn’t right. This goes doubly for interactive digital products, such as courses, apps, and games.

Marketer

Someone must schedule social media posts and decide what to say. They also need to film those videos, put together those early-access, buy-now timers, and set up that email sequence once someone signs up for the newsletter.

Sales

Sometimes, marketing and sales go hand in hand for digital products. But if you have higher-ticket items, you might have to do personal one-on-one selling to close the deal. Digital sales professionals also input information in customer relationship management (CRM) software.

The ‘Face’

Oftentimes, this is the creator or thought leader themselves. For independent digital products, someone has to put their creative or personal brand on things to help it stand out from similar competing products.

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What to look for in digital selling tools

Just as the products are digital, so too are the tools needed to make them and move them. In fact, some of this infrastructure can be the largest expense in the process outside labor, so it’s important to determine what you need in your tech stack. All of the following can help with online selling:

• Market research: Whatever website and social platforms you use, make sure you get access to analytics to see what’s working. You also need tools to research your competitors and target markets, like surveys.
• Content creation: You need to be able to build your digital products, using things like creative suites for graphic designers, productivity suites for slides and documents, and generative AI platforms to help speed things up.
• Hosting and storefront: Host your digital content in a secure place with a shopping function to collect payments and gate access to the product.
• CRM: Keep track of past and potential customers with sales software that keeps a database and helps automate your outreach, too.
• Marketing automation platform: Collect lead information through forms on your site, build quick landing pages for your marketing campaigns, personalize web content based on each user’s interests, and send custom email and SMS campaigns.
• Sales forecasting: The best way to make future sales strategies is to understand what’s already happened. Measure digital sales through your storefront over time, so you can begin to predict your sales cycles.
• Customer service management: Save time reading through emails of customer complaints with a platform for tracking and resolving issue tickets. After all, happy customers spread better word of mouth.

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Start selling digital products today

The market may seem stuffed with options, but new people start selling digital products daily, with breakaway successes cropping up constantly. You never know if you don’t try, and you’ve just taken a great first step by reading this guide.