How to Sell Digital Products – A Beginner’s Guide

I've been selling stuff online for over 3 years now I started with physical products on Etsy and Shopify and now I've moved on to selling digital products I'm only about 4 months into selling digital products but this shift has already been game-changing for me the margins are better the Fulfillment is automatic and I'm able to make money no matter where I am in the world when I started I found that a lot of the things that I've learned from running my physical shop transferred over to my digital shop and I think it gave me a head start so today I'm going to be taking everything that I've learned over the past 3 years and I'm going to be organizing it into a four-step beginner guide to selling digital products let's get right into [Music] it when it comes to ideas I get a lot of questions about third party tools like marmalade or everb if you're not familiar with these what I think they do is search Etsy for keywords that have a high search volume and low saturation in the market my impression of what they're trying to do is trying to find products that they think would be profitable based on a set of criteria I don't really know how effective these tools are because I've never actually used them my ideas so far have come from things that I've actually wanted or needed myself these are things that at some point I was looking to buy and found that one I didn't really like what was being offered and two thinking that I personally had the skills to make something better I feel like choosing a niche in this way is better because you'll be more familiar with the problem that your product is solving and you'll actually care more about it if I was using one of these tools and it told me that digital golf log books were good niche to get into I don't think I can make it work even if there were a lot of people searching for it and the saturation in the market was low I don't think I could do a good job because I don't know anything about Golf and I have no real desire to learn anything about it so that's a niche that's probably better left for someone else for me one of the biggest appeals to side hustles is that you can actually choose what you want to do you're not forced to do anything that you don't want to one of the most simplest ways that you can find your Niche is to look at the skills that you personally have and try to find products that can be improved upon with those skills to get started I recommend actually sitting down and writing a list of things that you're good at or skills that you currently have for me this would include things like graphic design photography math writing but it can also include unconventional things like Lawn Care drawing puzzles fantasy hockey or Mario Party try to be creative after you made your list you want to base your business on one of these skills because here's the key skills are the foundation to making money your skills are the reason someone will pay you because if they could do it themselves they would the only reason people pay for something is for having something done that they can't do themselves or they don't want to do themselves and before you comment and say hey Tim I have nothing I'm good at I have no skills you do everyone is good at something sometimes it can be hard to come up with a list because we tend to undervalue things that we're naturally good at but that's a mistake think of things that you you were good at when you were a kid or in school or things that people are always asking you for help with again it doesn't have to be conventional if you're good at video games a digital product idea could be a walkthrough or guide for a game that people find hard or if you're good at cooking maybe you could make a baking course or a template for organizing recipes if you take your time and you think outside the box I'm sure you can find something that you're good at and if not it might be time to invest some of your energy into learning something new [Music] at this point you might already have an idea or a niche in mind or you might not that's okay ideas are kind of a funny thing they come more naturally to some than others if nothing's coming to mind what I would do next is go on the hunt for ideas for this what I find helpful is actually going shopping on the platform that I'm planning on selling on if it's Etsy take an evening and actually browse what people are selling on there does anything interest you whenever I do this I always find products that I actually want and if I have the skills to make that product better that's something that I add to my list of potential ideas here's a pro tip for finding the best selling products on Etsy so first things first you want to open up a private browser this is just to make sure that your search results are clean and you'll be seeing something similar to what everyone else is seeing if when they're searching for the first time let's say you're the opposite of me and you actually love golf so we'll put in golf and since we're looking for digital items here we'll type in download okay so here's what Etsy is giving us what you want to do is click on on filters here and then click on Star seller what this is going to do is filter out all the stores that are not star sellers which is not necessarily what we want so if we go to the URL up here and change is star seller equal true to best seller so is best seller equal true so yeah now what you're seeing here is all the best sellers under this search term and you can gather your ideas this way this is how I find winning products and it's a big reason why I never found the need to use those third party tools that I mentioned earlier the mistake that a lot of people make in this point is seeing a successful product and straight up copying it again my suggestion instead would be to try to improve on what's being offered using your skills or interest in some way if you copy an existing product exactly there's no reason for a customer to choose your product over what already exists since existing stores have more sales and a better track record than you customers are just going to end up buying from these established drawers and Overlook yours some people who copy will try to get around this by undercutting the competition on price but over time as more and more people start doing this it leads to rock bottom prices where nobody is making profit if you're having trouble coming up with ideas on how you could improve on a product or offer something different one of the easiest things that you can do is mash up ideas take a product or service that's working in one Niche and apply it to a different one for example one one of the ideas that I gave in my idea video a couple months ago was personalized ketchup labels instead of making a shop that's exactly this think of other labels that you could potentially personalize maybe you're into a specific candy you could personalize a label for that or maybe it's board games or notebooks mashing things up is an easy way to be creative when you're having trouble coming up with an idea I've been doing this for a long time now and after trying a bunch of different business ideas niches there's two things that I personally try to avoid the first one is low- skilled niches if you've been browsing Etsy over the last few years you notice a huge uptick in AI generated art all it takes to make these is entering a prompt into a text box and because it's so easy and everybody is doing it there's a limit to how much you can charge for these people are selling this kind of art for $1 to $2 and often even less than that low skill opportunities are ones that anybody can do they seem tempting at first because it's so easy to get started but the problem with that is since anybody can do it everybody will and when everybody's doing it it's really hard to make money the second thing that I personally avoid is products that sell for less than $10 I like to browse SE Community forums from time to time and whenever I do I always come across these threads that are complaining about how high Etsy fees are there will be people saying that they sold $100 and Etsy took $90 or more in fees I didn't really understand this at first because I know what etsy's fees are and they're not 90% so I kind of just wrote them off as people who didn't know what they were talking about but when I started selling digital products and I saw how people were pricing their products I finally understood what was going on here when you're selling on Etsy you have to be aware of two types of fees etsy's transaction fees go to Etsy it's what they charge for giving you access to their customer base it's 6.5% plus 20 cents per listing there's also a payment processing fee which goes to Banks and credit cards this varies from country to country but if you're using the US and Canada as an example they charge 3% and 25 cents per transaction to me these fees are pretty reasonable 9.5 is about as low as you'll see especially when you're comparing it to other marketplaces available where people get in trouble here is selling things for really low prices and forgetting that they also have to pay a 45 C flat fee if you look at this chart here you'll see that if you price your digital products for 50 cents you actually make no money if you sell for 60 cents you make 9 cents in profit 84% of the sale goes to fees as you increase the price of your items a smaller percent of your sale goes to fees but even if you're selling your items for $2 you're still paying $32 in fees which is a lot keep in mind that this chart is the best case scenario if you're outside the US or Canada or you're using a different payment processor these fees are probably much higher than what you're seeing here but this. 50 to $2 range seems really popular for selling digital products especially on Etsy and it's it's something that I would personally avoid I just don't think it's worth it when you're considering how large of a portion of your sale goes to fees I'm only about 4 months into selling digital products and I've been experimenting with price ranges but I feel like the sweet spot is around $10 to $20 I like this range because it's an amount that people are still willing to spend on a digital product and it's still enough of a margin to make every sale worth it for you you have to remember that just because your products don't cost anything to fulfill or reproduce doesn't mean that not valuable to the customer if you're able to provide $10 to $20 of value to a customer they'll happily pay for it now that you have your idea it's time to move on to the fun part actually building it in my experience the best thing you can do when building a product is try to build it as fast as possible while there's a time in place to spend months or even years building a product if you're new to this or if it's your first time it's more important to focus on progression over Perfection the thing is you don't know your product is going to be successful or not so you want to get customer and Market feedback as fast as possible you don't want to spend so much time building a product and find out later that no one actually wants it if you're selling on Etsy specifically you want to have around 10 products in your store before you launch 10 sounds like an arbitrary number but when I was talking to an Etsy employee about SEO a couple years ago they actually said the same thing I don't know if this is actually built into etsy's algorithm because I do see shops that have one to three items do well too but they do seem to be an exception rather than the rule if you're on SCS you want to think in terms of launching an entire store and not just one product for example if you were opening a printable birthday decoration store you wouldn't want to just launch your store with just one design you'd want a variety of different designs for your customers to choose from personally when I'm shopping on Etsy and I see a store that has zero sales and less than 10 products I assume that they haven't even launched their store yet so I avoid buying from them so that's another reason that you want to have a variety of products available SEO is a subject that can sometimes seem overwhelming and complicated so I'm going to do my best to simplify it as much as possible first things first the goal of a search engine is to help people find what they're searching for in order to do this companies like Google and Etsy have algorithms that are constantly changing what they're really trying to do is show products that a customer might want to buy when they are searching for specific keywords or phrases because of this there's no or a secret thing that you can do to guarantee that your product gets it to the first page it doesn't work that way but there are some best practices that we can follow to make sure that we're not getting buried in the results for titles on SE what I found most effective after years of doing this is using longtail phrases that people might actually Search longtail keywords are phrases that are more specific than your average keyword generally they're three to five words long and the benefit to using these is they're less competitive than single word keywords so if you're selling activity books instead of just using activity book as your title it's better to make a list of longtail keywords like printable activity book for preschool activity book for learning ABCs animal activity book for kids when I'm doing this I'll come up with a list like that and order them from most likely to get searched to least likely to fill up the title completely I'll use as many characters as possible which as of today I think Etsy allows 140 characters item tags for Etsy are a little bit more straightforward my strategy for these is just to copy what's working for other stores and here's how to do it okay so here again you want to make sure that you're using a private browser and you're just going to go searching for your product let's say you're selling golf log books so you'll type in golf log book and maybe maybe digital okay so now what you want to do is click on some of these products these products are showing up on the first page under this search term so their tags must be pretty good so what you want to do is you want to click on one and scroll to the bottom and you'll see here where it says explore related searches these are the tags that this product is using so you want to take note of all of these you want to go back and look at multiple items and see if there's any common tags so we'll click on this one too and here are the tags for this and here are some different tags gifts for Grandpa I think that's a new one in a nutshell the tags that you're most commonly seeing here are the ones that you want to use use because these are the tags that are getting these products to the front page in comparison to title and tags item description is probably the least important when it comes to SEO but that doesn't mean that you should ignore them this is where you want to describe your product in detail you want to tell your potential customers everything they need to know about your product before they get it this includes specifications Dimensions How It's Made or how to use it you really want to put yourself in your customer shoes and think of any question questions that they might have before potentially buying your product when a customer has a question and they don't see it answered anywhere on the description page a lot of people will just move on to another product yes some will take the time and send their questions via message for you to answer but if you really want to give yourself the best chance at a sale you want to reduce the friction and write down everything a potential customer might want to know when it comes to product photos there's two categories that you have to consider the first one is the main photo or the one that shows up in search results for this photo I can't stress enough how important it is to have a photo that stands out one that's completely different to what all the other shops in that specific Niche are doing when a customer sits down and searches for something on Etsy depending on what they search they might be getting hundreds or even thousands of pages of results the only way to get a customer to stop and click on your product is to stand out from the crowd in some way so make a search for a product in your Niche and take take note of what all your competitors are doing write down common themes or common colors that you're seeing and do the exact opposite the purpose of the main photo is try to catch a customer's eye that's all it is for the rest of the photos you really want to use all available slots you want to show your products being made how they're going to be packaged and in different scenarios this is also a good place to put information that your customers might miss in the description if your product requires specific information when ordering it's a good idea to make a photo to tell your customers this so you've made your products and you've added the listings to your shop with the correct titles tags descriptions and photos the next thing you want to do is you want to test if everything you've done is actually working okay to test your SEO just like before you want to make sure you have a private browser so here you want to type in one of the longtail phrases or tags that you used in your products say one of them was printable golf log template after that you want to scroll until you actually find your product where in the search results is it showing up generally I'm happy if my listings show up within the first 3 to five pages nobody knows for sure exactly how etsy's algorithm works but I'm assuming they're showing bestselling items more often than new shops but in my experience with a brand new shop and brand new listings it is still possible to show up in the first 3 to five pages if you're following all this best practice SEO stuff most people looking to buy something are going to go through multiple pages of results anyways so I think it's not a big deal and and the first 3 to five pages is still pretty good from what I've seen over time if your items don't get sales they'll eventually drop in the rankings but that's okay too not every product that you make is going to get visits or sales personally if an item goes to 4 months that Etsy gives before it expires and it doesn't get a sale I just discontinue it if it doesn't get a sale in the first 4 months it's unlikely that it will ever get sales so there's no use in renewing it so full disclosure out of the four steps in this process here marketing is probably the one that I have the least experience in and the least natural skill for but even with that being the case over the years I've still managed to gain traction and get a good amount of sales when it comes to marketing there's so many things that you can do it can become easy to get lost in all of it so I like to simplify things into two categories the first way is the way that I use for every project that I start in the beginning and that's to focus on free Marketing in the beginning you don't know if your idea is good or not so you don't want to waste money on paid ads and you don't want to spend the time to make content to try to drive traffic to your store when you don't even know if your product is something that people want it's an experiment and the most cost-effective way to see if the experiment is going to be a success is to see if it can grow organically on its own this is why I'm always recommending a Marketplace that has some kind of algorithm that's connecting buyers and sellers that way if you have a good product you can benefit from the algorithm and experience some kind of organic growth in this case it's Etsy millions of people are going on Etsy every day searching for things to buy if you're SEO is good enough you don't really need to Market these buyers go on Etsy they type in their keywords into the search bar and your products will show up and if your products are good you will get visits and you will get sales in my last video I shared how much I made with a brand new shop in my first 3 months on Etsy and for the first 2 and 1/2 months I didn't spend anything on Etsy ads I got those numbers by solely relying on etsy's algorithm and the free things that I'm going to be going through next just because your product is digital and you're selling it on the internet doesn't mean that you can't sell it to real people in the physical world if you've chosen a business idea that you're familiar with it's likely that you know people in your real life that might benefit from that product too reach out to these people and let them know that you've made something that might help them you might be surprised by the amount of people who might be interested also in General is easier to sell to people who actually know you than absolute strangers so if you never sold anything before or you're new to it it's a good way to practice etsy's algorithm at its core tries to connect sellers with interested buyers but if you don't want to rely on a company or an algorithm to do this for you you can take this job into your own hands the first step in doing this is to brainstorm a list of people or groups that might be interested in the product that you're selling for example when I started my sticker shop selling labels for kids stuff my list consisted of parents grandparents schools daycares teachers and caregivers make a similar list that pertains to your specific Niche or product after you have a list you want to find out where on the internet these people hang out maybe it's a specific subreddit or a community Forum or Facebook group these are communities that are filled with your target audience and would be highly likely to buy your product if they just knew about it a word warning here don't be one of those annoying people that comes into a group and just spams the message board with an ad for your product that's an easy way to get banned or deleted really quick what you want to do is join these groups and actually be a contributing member be active create useful posts and help people with their problems in my experience a tasteful way to do it is to wait until someone actually posts about the problem that your product solves and that's when you can reply with your answer if you're a contributing member to a group group it's likely that they'll want to support you anyways because they've gotten so much value from you in the past next is paid marketing and before we move on to this I want to say again I wouldn't recommend doing this until you've established that people actually want your product if you've already gone through all the previous free methods that we've talked about and you're still at zero sales it's unlikely that any of this will work for you so because of that I proceed with caution because you might end up wasting a lot of time and money for nothing the first type of marketing is the type of marketing that you pay with your time the goal here is to spend your time creating content that will eventually funnel people to your store this involves creating content that showcases your products on platforms like Instagram Tik Tok or Facebook if you're able to create compelling content that can actually get views and you link these accounts to your store it's a good way to get extra traffic that can eventually lead to sales and all it costs is your time when this works it works really well going viral on one of these platforms can lead to an insane amount of sales but if you ever tried this you know how hard it is and how much time and effort it takes to actually get a significant number of views and to build a following it's really hard to come up with videos and images that do well on these platforms it's a whole other skill that you have to put time and effort into learning so if you're new to it another platform that I feel is often overlooked and is much easier to get started in is Pinterest I don't know about you but I feel like pin is often like a forgotten child in the family of social platforms I don't really hear a lot of people talking you about it but in my experience it's also a good way to drive traffic to your shop people go on Pinterest for inspiration whether you're looking for inspiration for fashion business weddings kids activities or really anything I would describe it as a visual search engine whatever your Niche is you can create content in the form of images and Link them to the items in your store and in my opinion it's easier to get views on your pins than on your videos for Tik Tok or Instagram next is marketing that you pay for with money instead of time and I put it last for a reason the reason is because if you do this wrong you could actually end up losing money and as someone who is pretty risk averse I don't like the idea of that but say you've been in business for a while you've been doing the other types of marketing and you're doing pretty well you're making profits and you want to reinvest some of that profits into maybe growing your store faster that's when I start looking into this Etsy ads are kind of weird because I feel like they don't really bring any extra eyeballs onto your products the people who are seeing these ads are already on Etsy and if your SEO is good and your products are selling well customers should already be seeing your products anyways what you're really paying for here is making your listings show up more often than usual which can lead to more sales but it's definitely not guaranteed if you want to try it my strategy for Etsy ads have always been to only promote my bestselling products never products that I'm still unsure about I start with a low daily spend if you're new to this you can start with a dollar a day I think maybe that's the minimum on Etsy but I'll slowly increase this over time while keeping an eye on my return on ad spend if the return on ad spend drops too low to the point where it's no longer worth it that's when you want to back off you don't want to be one of those shops that has $100 in sales but $90 in ad spend and $10 is going to fees with Etsy ads in particular I don't think there's a correct amount to set it's all about experimentation you're going to have to test it out and see if it's worth it for yourself it may or may not be I'm not going to get into too much detail with these because I feel like they're kind of advanced and this video is for beginners but if your store is doing really well I want to mention two more ways of marketing that can be really [Music] effective the first one is paid at ads on other platforms this is where you create an ad in the form of a video or image and you pay a platform like Facebook Tik Tok or Instagram to show it to their users the good thing about these is that visibility is guaranteed unlike creating free content on these platforms that might get zero views you're paying these companies to show it to an X number of people if your ads are good this is going to lead to extra traffic to your store which can lead to sales but as you know it can be hard to make this type of content and it's another skill that you're going to have to put time and effort into learning another method of paid advertising is influencer marketing this is finding influencers in your Niche and paying them to create content around your product or your store this might sound expensive but I've had varying success reaching out to smaller influencers one with 1 to 5,000 followers a lot of influencers of this size are willing to make content in exchange for free product and if your product doesn't cost much to make it can lead to a really high return with very little risk you might be surprised on how much influence these smaller creators have even if they have a relatively small following sometimes it's not about the amount of followers an influencer has but it's about how engaged their following [Music] is imagine you're playing a game and there's a wheel you have to spin the wheel is divided up into slices but the catch is you don't know how many slices there are there could be five or there could be a 100 but all the slices start red when you spin the wheel and you land on a red that slice turns green the goal of the game is simple land on green as many times as possible you can spin as many times as you want and the only way to lose is to stop spinning when you go through all of these steps you come up with an idea you spend the time building it and then you spend the time marketing it and putting it out into the world one of two things is going to happen you're either going to get sales or you're not if you get sales the next step is easy you double down on whatever worked if you're selling wall art and the one that you made with a rocket ship design starts getting sales that tells you that it's time to make more designs with rocket ships or other space related things if you don't get sales you're not going to like this answer but the next step is to spin the wheel again go back to Step One come up with another idea or another design and go through all the steps again some people playing this game are going to spin once or twice and hit red both times they might complain that the game is rigged and that they probably have a wheel that has a thousand slices and their chances are lower than everyone else's they'll see other people spin and hit green and think that they must have cheated somehow they'll convince themselves that this game isn't worth playing and they'll stop spinning the reality is it doesn't matter how everyone else is doing this is a one-player game the only thing stopping you is yourself and hitting red isn't a failure when you come up with an idea and you go through the effort of actually building building it and putting it out into the world even if it doesn't work it increases the chances that it will work next time one you'll be developing skills every time you do this and these skills are valuable and two you'll gain experience and insight into why your idea failed and you can learn from it and avoid making the same mistakes next time I tried a lot of different things before my sticker shop H it off I made various attempts to grow an Instagram following with gaming content and photography I tried to start a t-shirt company focusing on nerd type apparel that got nowhere and somewhere in the depths of YouTube there's a failed Pokemon Channel that I started a long time ago all of these red spins got me to where I am today and will play a part in whatever I do in the future remember the more times you spin the wheel the more green slices there will be and the only way to lose is to stop spinning so whether this is your first spin or your 20th spin if you're struggling to come up with your next idea you can check out this video over here if not thanks so much for watching I hope you found this useful take care of yourselves and I'll see you in the next one bye

Channel: Tim Koa

Views: 75,824

Keywords:

Id: w3_R4sH1w-A

Length: 28min 38sec (1718 seconds)

Published: Mon Apr 15 2024